16 November 2011

Supreme Court changes the rules

Paul Hewitt
Partner | UK

The Supreme Court has just published its decision in Jones v Kernott [2011] UKSC 53 on the vexed question of how the beneficial shares in a family home owned by an unmarried couple are to be determined.

Ms Jones and Mr Kernott met in 1981 and had two children together. In 1985 they purchased a house in their joint names for £30,000. No declaration was made as to how the beneficial interest in the property was to be held. The couple separated and Mr Kernott moved out in 1993 and thereafter Ms Jones paid the mortgage etc.

In 2006 Ms Jones applied to the County Court for a declaration that she owned the entire beneficial interest in the property which by 2008 was worth £245,000. Mr Kernott claimed that he owned 50%. The County Court judge found that Mr Kernott was entitled to only a 10% share. The Court of Appeal allowed Mr Kernott’s appeal.

The Supreme Court have unanimously allowed Ms Jones’ appeal and restored the order of the County Court. The majority held that the judge had correctly inferred the couple’s intention as “the intention which reasonable people would have had had they thought about it at the time”.

There will be estates where joint ownership property disputes may have a significant impact on the value of residue. A more detailed summary with be in the next ILM Legal Update (and discussed at Legacy Labyrinth event).

Category: Article