3. Devolution of Property without Will (Intestate Succession)

The rules of intestate succession laid down in the Administration of Estates Act 1925.

KEY DEFINITION Intestate – to die without having made a will.

The rights of the surviving spouse or civil partner

KEY DEFINITION Issue. The children or other lineal descendants of a person. Residue. Residuary Estate. The property after payment of debts, funeral expenses. Bona vacantia. Property with no owner and which passes to the Crown. Chattels – movable property.

Rights in the Matrimonial Home

KEY DEFINITION Joint tenancy. Ownership of land by two or more persons who have identical interests in the whole of the land. A joint tenancy can only arise when four conditions are satisfied: 1) Each joint tenant must be entitled to possession at the same time; 2) The interest each has in the land must be identical; 3) The same title for a land: to A and B as joint tenants; 4) Interests must subsist for the same time. Tenancy in common. Equitable ownership of land by two or more persons in equal or unequal shares. Each co-owner may sell or dispose of his share by will. A share does not pass automatically on the death of a co-owner.

See table: Intestate Succession

Seminar 4

REVISION CHECKLIST

What you need to know:

1. A presumption of death

2. Devolution of Property by Will

3. Devolution of Property without Will

4. Inheritance Tax

Read:

- Wills Act 1837,

- Inheritance (Provision for Family and Dependants) Act 1975

Be ready to discuss.

Question 1

Victoria and James met 15 years ago and began to cohabit. They have four children, aged 2, 4, 6 and 8. Shortly after they met, James bought a plot of land for £5,000 and registered the property in his name only. Victoria and James then set about building the home of their dreams, living in a caravan on the land. James continued to work, using his salary to buy raw materials, and he and Victoria would work on the building of their home each evening and weekends, with Victoria doing what she could during the day. The house took them five years to complete, and they moved in just in time for the birth of their first child. Victoria has never worked, but used a small legacy of £5,000 to buy curtains and soft furnishings for the home and to decorate the nursery.

James has now told Victoria that he feels trapped and wants to leave her and the children to sail around the world on his own. He wants to sell the house and use the proceeds to finance his trip.

Advise Victoria on her property rights, if any, in the house.

Answer plan

Again, this couple will not be using the wide powers the court has on divorce. Instead entitlement must be determined by reference to strict property law rules:

• Legal and beneficial entitlement must be examined;

• is there any evidence of an implied, resulting or constructive trust?

• mention s 37;

• consider what protection, if any, is provided by LRA 1925 s 70(l)(g);

• possible application for sale under s 14 of the Trusts of Land and Appointment of Trustees Act 1996.

Answer

Victoria is seeking advice as to her property rights, if any, in the home she shared with James. The couple have never married, and so the court lacks the wide powers available to it under the Matrimonial Causes Act 1973 to make fair and just resolution of financial matters. The law, therefore, treats cohabitees in an entirely different way when their relationship ends, and consequently Victoria's entitlement must be determined according to the strict rules of property law.

Victoria will need to apply to the court for a declaration of her entitlement in the house, and may need to take steps to protect any interest in case James mortgages the property or otherwise deals with it.

The starting point for any discussion of property law rights is to examine the conveyance to see whether it contains any declaration as to legal or beneficial entitlement: any such declaration is conclusive in the absence of fraud or mistake (Goodman v. Gallant (1986)). The property in the present case is registered with James as the sole legal owner, and there is no declaration of any beneficial interest for Victoria in the conveyance.

The facts do not disclose that there has been any subsequent express declaration of trust in Victoria's favour. Equitable interests must be vested and evidenced in writing: Law of Property (Miscellaneous Provisions) Act 1989 s 2; Law of Property Act 1925 s 53(l)(b). There is no such declaration, and therefore any interest that Victoria may have must be by way of implied, resulting or constructive trust, which do not require the usual formalities.

To establish such a trust, it is necessary to show that whilst one party is the legal owner, there was a common intention that they should both have a share in the property, and in addition that the party claiming the beneficial entitlement acted to their detriment because of this common intention.

This is easiest to establish where a party can show that he/she has made direct contributions to the acquisition of the home, either by paying part of a deposit, or by paying the mortgage. Then, in the absence of evidence to the contrary, it is presumed that they intended to share the property in proportion to their contributions: Cowcher v Cowcher (1972). Victoria did not, however, pay the deposit; this was paid by James in buying the plot of land. Neither did Victoria pay any mortgage instalments or buy any raw materials. All the materials were paid for by James, and Victoria did not have any paid employment.

If there is no evidence of direct contribution, then Victoria will need to establish a common intention in another way. It may be that there is clear evidence of a common intention, for example, a conversation, a letter, some kind of assurance from James that this would be their house, for example, Eves v Eves (1975). If not, then Victoria will need to prove a common intention by reference to her indirect contributions. It is harder to establish common intention in this way: Lloyds Bank v Rosset (1991). Victoria has not made any financial contribution to the maintenance of the family which has thereby enabled James to pay the mortgage, as in Grant v Edwards (1986). However, by her efforts she has physically helped him to build their house, and transform a building site into a family home.

The courts have been very strict in insisting that the efforts and contribution to the improvement of the property must be substantial: Pettitt v Pettitt (1970). Consequently, the use of Victoria's legacy to buy curtains and furnishings and to redecorate the nursery is not sufficient: Gissing v Gissing (1971). The amount involved, £5,000, is quite a lot of money, but this is the sort of sum that is easily spent on furnishing living accommodation, without thereby acquiring an interest (Lloyds Bank v Rosset (1991)). However, Victoria's physical efforts contributed substantially, as she has helped James at weekends and evenings, and worked by herself on the property during the day. Together they have transformed the house (as in Cooke v Head (1972); Eves v Eves (1975)), where the women cohabitees acquired interests.

It seems right that Victoria's substantial efforts can be taken as evidence of a common intention to share the property. It is unlikely that she would make such a superhuman effort for no reward, nor that James would expect her to. Her contributions as a mother and a lover do not acquire any interest (Burns v Burnsi W84)), but her contributions to the building evidence a common intention as well as actions to her detriment. The extent of Victoria's share will need to be determined by the courts, and it would seem that she has made as much, if not more, physical contributions than can be equated as money's worth than James. He, however, did make the original purchase of the land and buy the materials.

Applying the principle in Midland Bank v Cooke (1995) the whole of the history of the relationship and the parties conduct and contributions can be looked at to determine the size of shares intended. Thus, once Victoria establishes an interest under a trust according to the strict rules in Gissing v Gissing (1971) and Lloyds v Rosset (1991), she could argue that there was an intention that they should have equal shares. Victoria could also use Matrimonial Property and Proceedings Act s 37 to argue that she has acquired or enlarged an interest because of her substantial contributions in money or money's worth.

If Victoria does have an interest in the home, then she must consider how this can be protected should James try to sell or mortgage the property. Since Victoria is in occupation of the home, which does not necessarily have to be continuous or exclusive (Kingsnorth Finance v Tizard (1986)), she has an overriding interest (Land Registration Act 1925 s 70(1 )(g)). This means that even if her interest is unregistered, she will be protected against sale or mortgage to a third party, unless their enquiries could not disclose her interest: Williams & Glyn's Bank v Boland (1981). The only time she may find her interest overreached is if James sells or mortgages to a third party and the proceeds are paid to James and another trustee for sale that he has appointed: City of London Building Society v Flegg (1987).

It is probably wisest for Victoria to register her interest in order to be protected, and if she becomes a co-trustee then she can refuse her consent to any sale. This would force James to apply to the court under s 14 of the Trusts of Land and Appointment of Trustees Act 1996 for an order for sale of the house. In determining the application, the court can make such order as it sees fit. This is not a power to alter the actual property rights of the parties, but to determine whether the sale should be permitted to proceed or be postponed. In the case of a matrimonial or family home, the court will look at the purpose for which the house was provided: Re Evers Trust (1980). In the present case, the house was built as a family home, and, since the children of the family are so young, it is still needed as a home and sale will not be ordered.

If, however, Victoria is not a co-trustee then she cannot block the sale as of right, and so she will need to ask the court for an injunction prohibiting sale: Waller v Waller (1967). This would then enable a second trustee to be appointed who could safeguard her interests.

Thus it can be seen that Victoria is likely to have acquired an interest in the home, but she needs to be vigilant in order to protect herself against James' possible future moves.

LECTURE 5

PARENTS AND CHILDREN

1. Who are the parents of the child?

2. The Human Fertilisation and Embryology Act 1990

3. Parental responsibility