Court considerations in the division of the home when cohabitating couples split

The recent case of Lunt v Csurgo (CHP 2019/140) has concisely summarised how the Isle of Man High Court will approach the division of a property/its proceeds of sale when a cohabitating couple split.

Firstly, the Court in Lunt considered a previous judgment in Stanley v Morris SUM 2013/152, whereby the Court set out that there was a presumption that shares in a property should be divided equally in instances where the property was held as a joint tenancy. It was also highlighted that where one party argues that the beneficial interest in the property held at joint tenants should be split otherwise than equally, then the burden is on them to persuade the court that such an order should be made.

Lunt highlights that when considering a case of this nature the Court is to have regard to all the circumstances, including, but not limited to:

  1. When the couple acquired the property, any advice they obtained or any discussions the couple had at the time in respect of the purchase of the property and/or their intentions to do so;
  2. Reasons why the individuals acquired the property in joint names;
  3. Any reasons as to why (if it be the case) the survivor was authorised to give a receipt for the capital money;
  4. The purpose of acquiring the property;
  5. The nature of the relationship between the parties including whether there are any children;
  6. The financing of the property both initially and any subsequent payments as well as any indirect contributions made by either of the parties;
  7. The arrangement of the parties finances;
  8. How household expenses and outgoings were organised and arranged; and/or
  9. The personalities of the parties.

The Isle of Man High Court in Lunt also referred to a helpful previous English Supreme Court decision in Jones v Kernott [2011] UKSC 53, whereby the Supreme Court took the following approach in circumstances where a couple had contributed to the purchase price of a property, but in unequal shares:

  1. The starting point is the presumption that equity follows the law and individuals are to be treated as joint tenants in law and in equity;
  2. This presumption can be rebutted if:
    • the individuals, when acquiring the property, had different common intention of this presumption; or
    • this intention was later reached that the individuals respective shares would change;
  3. The intentions of the parties are to be drawn from their conduct;
  4. In instances whereby it is obvious that:
    • The individuals did not intend to create a joint tenancy at the outset of the transaction; or
    • The original intention of the parties has changed however there is no way in which to determine the actual intentions of the parties in respect of their shares of the property

Each party is entitled to their share of the property which the Court considers fair having regard to all the circumstances.

  1. Matters will be determined on a case by case basis. Although financial contributions is a factor to be considered there are also other factors which the Court is to have regard to. 

The case of Lunt v Csurgo highlights that thought ought to be given at an early stage in respect of how a property is to be divided in the unlikely event that the relationship breaks down in order to avoid costly and time consuming Court proceedings in the future in the event that this occurs.

DQ’s Dispute Resolution team are routinely instructed to assist in relationship disputes. If you require any further information or assistance in this area please do not hesitate to contact Dawn Jones (Consultant, Dispute Resolution), Rose Kinrade (Associate, Dispute Resolution), and/or Jessica Cocker (Trainee Advocate, Dispute Resolution).