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Kernott v Jones - Mr 10%

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There has been a development in the law following the Supreme Court Judgment delivered yesterday in the case of Kernott v Jones.

The judgment has clarified the previous case of Stack v Dowden and has provided assistance in clarifying ambiguous terms from the previous judgment. However, the law has remained the same!

A brief history: This case involves Mr Kernott and Ms Jones who entered into a relationship in 1980 and began cohabitating in 1983. The parties purchased a jointly owned home in 1985.  The parties then separated in October 1993 and Mr Kernott vacated the family home with Ms Jones remaining in the property with their children.

There was discussion between the parties in October 1995 when Mr Kernott wished to realise his share in the property and the property was placed on the market for sale. However, as the property obtained no interest on the open market it was agreed between the parties that a joint life insurance policy would be cashed and Mr Kernott would receive half of the proceeds to enable him to purchase an alternative home.

The question therefore before the Courts was whether 15 years later Mr Kernott could request a 50% share of the jointly owned home despite not contributing to it for 15 years?

Well most people will be surprised to note that when a property is purchased together, if there is an express declaration (a note on the transfer deed which states how you hold the property, joint tenants or tenants in common) then you are bound by this declaration despite how many years have passed. 

In this case there was no express declaration and therefore the question before the Court was ‘In the absence of an express declaration can the parties move away from the presumption that the property was held equally?’

Ms Jones was arguing that she should receive a larger share as she had been solely responsible for the mortgage and maintenance of the property for 15 years.

The Supreme Court has now confirmed that while there is a presumption that the property should be held equally this can be overturned if evidence can be provided to show that this was not what the parties intended.

To show this you need to prove that there has been a change of agreement between the parties as to the interests each of them have in the property either by express agreement (both of you agreed verbally or in writing) or by proving that you can infer such a change by looking at how you both acted. In this case cashing the life insurance policy to enable an alternative home to be purchased and Mr Kernott no longer financially contributing to the property provided the evidence to establish a change to the original agreement.

If it can be shown that the intention has changed then there may be scope to move away from a 50:50 division. In this case Ms Jones was awarded a 90% interest in the property.

This case highlights the importance of agreeing with your partner how the property will be dealt with following a separation. It is not wise to assume that you will be entitled to a larger share just because you have made a greater contribution to the mortgage and the upkeep of the home. The onus will still be on you to bring evidence to prove this. 

My advice:
As soon as you are contemplating separation discuss the terms with your partner. A separation agreement can be prepared which will offer you protection. A separation agreement is normally drafted to reflect the terms of any settlement or agreement reached on the breakdown of a relationship. These agreements are legally binding and bring clarity to separation and relationship breakdowns.

2) When you are contemplating setting up home together talk to your partner about what should happen if you separate. Cohabitation agreements are the way forward. Couples who decide to live together or are already living together should have an agreement drafted to determine what will happen with the family home, finances, furniture and any other assets should the relationship break down. This will protect your position in the event of a relationship breakdown.

If you require any advice regarding separation/cohabitation agreements or advice regarding your legal position as part of an unmarried couple please do not hesitate to contact me or our specialist team on 01616 966 229.

By family law legal executive, Gillian Lavelle