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Ask Clare Your Own Question
Clare, Solicitor
Category: UK Law
Satisfied Customers: 34131
Experience:  family solictor with 25 years experience
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My former partner wishes to buy my share of the house we

Customer Question

My former partner wishes to buy my share of the house we bought together, but (after offering back my deposit and how much of the mortgage I've paid thus far), has only offered me 25% of the house's increase in value since we bought it (on the grounds that my deposit was only £10,000 out of a total £40,000 (£20,000 of which was her's, and the final £10,000 her parents').
However, we've both read the Declaration of Trust and I don't see where that it states that I'm only owed 25% of the house's increase in value.
The Declaration of Trust is as follows:
THIS DECLARATION OF TRUST is made this [day] day of [month] [year] BETWEEN (1) [me] of [] (2) [partner] of [] [partner's parents]
(A) By a Transfer dated [day][month][year] the Property ("the Property") details of which are contained in the Schedule hereto was transferred to [me] and [partner] and to be held by them as tenants in common subject to the usual joint proprietorship restriction.
(B) By a Mortgage ("the Mortgage") dated [day][month][year] made between (1) [me] and [partner] (2) the Bank the Property was charged to the Bank to secure the sum of £117,900.00
(C) The Purchase of the Property and the costs of purchase were provided as to £20,000.00 by [partner], £10,000.00 by [me], £10,000 by [partner's parents] and £117,900.00 by the Mortgage.
(D) The parties make this Declaration to set out their respective interests in the Property and its proceeds of sale and net rents and profits thereof until sale
1. The parties hereby declare that they hold the property on a trust of land.
2. The parties hereto DECLARE and that they hold the Property and its proceeds of sale (after discharging the mortgage and deducting therefrom the costs of sale) and the net rents and profits until sale UPON TRUST for themselves as tenants in common
(a) as to £20,000.00 for [partner] absolutely
(b) as to £10,000.00 for [me] absolutely
(c) as to £10,000.00 for [partner's parents] absolutely
3. In this deed the expression "the Mortgage" shall include any future substitution for the Mortgage or addition thereto
My understanding is that this declaration only states that the three parties are owed back their initial deposits. Is this true?
And where, if anywhere, does it state how the house's increase in value should be divided? My reading of it is that as "tenants in common" we should divide it equally, but I am no expect. Please advise.
Thank you!
Submitted: 10 months ago.
Category: UK Law
Expert:  Clare replied 10 months ago.

Thank you for your question

My name is Clare

I shall do my best to help you but I need some further information first

Is that all the deed actually says

Customer: replied 10 months ago.
Hi Clare,There was one additional line at the very bottom of the page which says "IN WITNESS", but apart from that, yes, that is all it says.Thank you
Expert:  Clare replied 10 months ago.

How much is the property now worth and how much is outstanding on the mortgage

Customer: replied 10 months ago.
The property has now been valued at £200,000.
The mortgage, which started at £117,900, has an outstanding balance of £98,600.
Expert:  Clare replied 10 months ago.

Whose name is ***** ***** the title?

Customer: replied 10 months ago.
I assume by title you mean the deeds held by the land registry? If so, the 'registered owner(s)' listed there are myself and my former partner. Her parent's name do not appear anywhere on that document.
Expert:  Clare replied 10 months ago.

Thank you

The deed is somewhat ambiguous as to what should happen to the equity once the purchase monies are returned

It could be read that the list sets out the proportions in which the property is held (hence the 25% offer)

Another reading could be that the equity should be divided into three (you, your ex and her parents)

Alternatively it could be that the equity is simple split between you and your ex.

It would be a matter for the Court to decide if you choose to make an application under the Trusts of Land and appointment of Trustees Act.

On balance it is hard to assess what the court would do - although on balance I fear that it is more likely that they will go with the 25% possibility

I hope that this is of assistance - please ask if you need further details