UK Property Law
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Did the contribute to the financing of the original purchase? If not, please state how they have otherwise invested in the property (eg. paying off mortgage or capital expenditure on improvements.
they contributed with the financing of the original purchase and also with extension of the property.
Okay, at the time of the original purchase was a declaration of trust executed? One document signed as a deed by each owner/contributer stating in what shares the equity was to be divided upon sale of the property?
No a declaration of trust was not executed but i do acknowledge their contribution towards the property. No documents were signed. The property was put under my name because at that time i was the only one who was able to get a mortgage.
In that case you should considering executing a declaration of trust prepared by a solicitor now taking account if the fact that ,although on the face of it you are the registered proprietor of the title, you each own differing percentages in the equity of the property.
You should ask the solicitor to also registered the declaration against the registered title in the form of a notice. Get them to keep a counterpart with another counterpart to be retained by you. That will put your family member's percentages outside of the matrimonial asset pool in the event of divorce. It will cost approx £150-200+VAT.
Assets acquired before marriage by an individual party become included once the marriage is a "medium" to "long" one (ie. 7-10 years as a rough guide but each case is decided on its own merits), so the longer you are married the more likely your share will be included in the settlement negotiations.
You may consider also executing a pre-nuptual agreement with your fiance to provide some additional protections, the Courts have been inclined to attach more weight to these recently.
In the end, marriage is a financial commitment which does expose your assets to risk the longer the marriage goes on, but you should reflect the respective interest in the property in the above way.
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in response to your first answer executing a declaration of trust, could you please explain that in more detail, as well as the pre nuptual agreement.
A declaration of trust would state the terms of the purchase, who is the owner any mortgage on the property, the contributions of each party and then go on to declare that once the property has been sold person A would receive x% of the proceeds of sale, person B would receive y% and so on. It may also state the rights of any party to ask for the property to be sold.
It would be registered against the legal title so that it could not be sold without anyone having notice of the declared interests.
A pre-nuptual agreement is a document executed by fiance and fiancee prior to marriage setting out what is to happen to their assets owned as at the date of the marriage and any assets acquired during marriage. It can take account of one party's pre-marriage wealth and state that some assets are not to be included in the matrimonial asset pool over which settlement will be agreed.
Although enforceable the provisions of the pre-nup can be overcome in the event of a very long marriage or if there are children of the marriage, the welfare of children is the primary concern of the courts and their needs (accommodation schooling expenses etc) will come first to the extent that the spouses having residence of the children post divorce will be entitled to a large share of the matrimonial asset pool. You and your fiancee would have to take separate independent legal advice in order to achieve the a greater level of enforceability.
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