When a couple break up, the division of the assets they own is often problematic, whether they are married or not.
In a recent case, the Court of Appeal was asked to consider the appropriate division of assets when a couple broke up after being together on and off for more than a decade.
The couple began living together in 1992, then separated in 1995. In 2001, they got back together, living in the man’s house until 2002, when they bought another property in joint names in which they lived until it was sold in 2007. As well as a business selling militaria, the man engaged in property development. In 2002, he formed a company which bought and sold several properties over the years. In addition, he sometimes purchased development properties in his own name. One such was transferred to the company and later sold at a profit in excess of £400,000.
When the couple broke up, the female partner claimed that the true ownership status of all the properties they had acquired (there were three remaining by this time) was equal and that she had been promised that she owned a half share in all of them, the purchases having been structured as they were merely in order to avoid unpalatable tax consequences.
Fatal to her claim with regard to shared ownership of the properties owned by the company was the Court’s finding that (in effect) she had not had any promise made to her by the company which was enforceable against it. Furthermore, she had done nothing to her detriment which could ‘justify the creation of a good claim in equity against the company’.
She also failed with regard to her claim for a larger share in the proceeds of the 2007 sale of the jointly owned property, mainly on the ground that the claim had not been specifically made out at the original trial.
The case illustrates how important it is to prepare one’s claim carefully when bringing proceedings and also to ensure that ‘casual’ promises are turned into legally binding ones. In this case, the male partner’s promise on his own behalf did not bind the company.