Property Issuues

The ownership of family assets is determined, in the first instance, by property rights. The same principles in property law and equity that apply to disputes between non-married persons also apply to disputes between spouses and persons whose relationships have ended.

Northern Ireland Law provides for legal and beneficial ownership of property. Notwithstanding that property may be held under legal title, such as title on the land registry or deeds, in a particular way, the underlying contributions for the purchase price and agreements may mean that the beneficial ownership or equitable ownership is held differently.

Apart from general property law principles, courts have powers in the context of separation and divorce to transfer property rights and apply principles of justice as the circumstances require. In this instance, the courts are not declaring property rights but redistributing them step by step.

The Married Women’s Property Act reversed common law rules and gave wives the freedom to own and enjoy property. Under common law, control of a wife’s property vested in her husband.

The Family Law (Miscellaneous Provisions) (NI) Order 1984 provided for a spouse’s legal right of occupation of the matrimonial home. This right of occupation could be bound by a registered charge. A third-party purchaser without notice could purchase the estate free of the matrimonial home charge.

The Partition Act provides for the division of property owned jointly. The court has discretion toward a sale when the parties do not agree on sales.

See the sections on beneficial and equitable ownership under the principle of resulting trust. The legal owner of property may be obliged to hold the property or share it on trust for a spouse to the extent that the spouse contributed towards the cost of acquisition of the property. This principle is based on the presumed intention of the party.

Where the parties have agreed that the property would be held in a particular manner, the court may enforce the agreement and the beneficial ownership arising from it. There must be a common intention to hold the property and beneficial interest in a particular way, typically equally.

The courts also apply the principles of constructive trust in separation and disputes where one party has acted to their detriment in reliance on an agreement or representation made by the other party regarding the manner in which the property would be held. In such cases, the court may decide that the party who has led the other to believe such must hold part of the property in trust for the other party. A so-called constructive trust is a flexible equitable remedy. It may be easier to have the court invoke this right than to prove contributions for the purpose of resulting trust.

As between strangers, the general principle is that when a party advances money towards the acquisition of a property, they are entitled to a share corresponding to that advance. However, in certain circumstances, there may exist a relationship between the parties that gives rise to a presumption of a gift. This typically happens between husband and wife but may also apply in the case of other relationships.

At common law, the principle applies to money advanced for the conveyance or purchase in the name of a spouse. The presumption is that this is intended as a gift rather than a resulting trust.

In some cases, the position may be declared through a declaration of trust occurring simultaneously. In other cases, it may be a matter of determining the facts in the circumstances and common intention after the event, especially in the case of a dispute.

Certain trusts may be void for properties purchased in another person’s name to avoid transfers or taxes. In these cases, the court will not aid the person alleged in the trust on account of the improper motive.

Where persons act to their detriment in reliance on promises made by the other party that induce them to so act, this may result in a so-called proprietary estoppel. In such cases, the court may decide that this constitutes an equity in favor of the person who has acted to their detriment and hold a beneficial interest accordingly. The principle is similar to that applicable to constructive trusts but requires specific inducement, acting to the detriment, and the force of the inducement.

Engaged persons stand in a differential relationship compared to unmarried persons. The former legal action for breach of a promise to marry was abolished by the Family Law (Miscellaneous Provisions) (NI) Order 1984. An agreement may be relevant in determining the intention with which property has been purchased or assets transferred between the spouses.

The Married Women’s Property Act creates a relatively short-form procedure to determine property rights between spouses. However, it does not, by itself, give the court the power to reallocate property.

Regarding matrimonial homes, the law gives the non-earning spouse a right of occupation in the family home. The non-earning spouse must not be evicted or excluded from the home except with the leave of the court.

If the non-earning spouse is not in occupation, he or she has a right, with the consent of the court, to enter and occupy the dwelling. These rights continue as long as the marriage exists. To be protected, these rights should be registered in the land registry or registry of deeds applicable. These rights apply only to the matrimonial home in which the parties reside.

In making orders under the legislation, courts consider the parties’ conduct with respect to the financial needs of children and the circumstances generally.

Under the legislation, an order may grant one spouse the right to occupy the family home. The court may make an order declaring, enforcing, restricting, or terminating the right of occupation. It may prohibit, suspend, or restrict either spouse’s exercise of the right to occupy the dwelling. It may require either spouse to permit the other to exercise the right to occupy the dwelling. The non-earning spouse is entitled to continue paying mortgage payments.

When a third party purchases property, they will be bound by the beneficial ownership of, for example, a spouse if they would have common notice of it by making proper inquiries.

The principles applicable to cohabiting couples are similar to those set out above. The procedure under the Married Women’s Property Act and the procedures are not available. However, protection of the matrimonial home, as set out above, does not apply. There are special provisions applicable when there are dependent children.

In practice, the courts may not be as willing to find a common intention to hold property jointly or other circumstances on which a resulting or constructive trust may be found when the parties are not married. General principles of a common intention or estoppel and constructive trust principles or when a person acts to their detriment may apply.

Disputes relating to ownership typically arise in retrospect after a separation and disputes as to ownership. In these cases, the court attempts to interpret and infer intentions from the circumstances after the events, and the process may be somewhat artificial.