The short answer is no, verbal agreements in relation to property are not binding. This article covers what property claims are available.
But all is not lost. If you and your partner agreed verbally that a property in their sole name would be yours jointly, and your relationship has subsequently broken down, it is possible to bring a claim for an interest in the property.
Are these property claims dealt with in the Family Court or Civil Court?
Disputes between unmarried couples in relation to property and finances are dealt with in the Civil Court. It is therefore very important that you instruct a civil law specialist (as opposed to a family law specialist) who is used to working within the strict rules and cost provisions that apply in the Civil Court, as these are completely different to the Family Court rules.
What property claims are available to me?
There are two different claims you are able to pursue, the primary one of which is a claim under the Trusts of Land and Appointment of Trustees Act 1996 (“TOLATA”).
To successfully bring a TOLATA claim, you must satisfy a two stage test demonstrating:
- A common intention between you and your partner; and
- Financial contributions or contributions in money’s worth.
Our specialists will be able to take you through the circumstances in which this test will be satisfied and the evidence you would need to provide.
If your TOLATA claim is successful, the court can make a declaration that you have an interest in the property, and that the property is to be sold to allow your interest to be realised. You can read more about TOLATA claims here.
This is a less common claim used between unmarried couples on relationship breakdown, and is more common in farming families. Proprietary Estoppel claims do occasionally arise on relationship breakdown, so our specialist legal advisers will always discuss with you your circumstances to ascertain whether you may have a meritorious claim.
For a Proprietary Estoppel claim to be successful, you must satisfy a three stage test:
- A promise or assurance was made to you;
- You relied on that promise or assurance and acted to your detriment; and
- It is unconscionable for the promise to have been reneged on.
Whilst the three stages above may seem straightforward, Proprietary Estoppel claims require a significant amount of evidence to demonstrate each stage of the test.
Is it too late to protect my interest in the property if I have already made my financial contributions?
Definitely not! Whilst ideally you should enter into a formal agreement before you make any financial contributions, it is not too late to protect your position if you have already done so.
It is important to speak with a specialist as soon as possible to discuss the document most appropriate for you. The costs of putting in place a document to protect your position prior to any dispute are a drop in the ocean compared to the costs of forwarding a claim under TOLATA or Proprietary Estoppel. Therefore, it would always be our advice to put in place a Cohabitation Agreement or Declaration of Trust rather than wait for a dispute to arise at some point in the future.