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PROPERTY: Jones v Kernott [2009]

Date:10 JUL 2009

(Chancery Division; Nicholas Strauss QC sitting as a deputy judge of the High Court; 10 July 2009)

The unmarried couple purchased a property in joint names. The woman supplied a deposit; the balance was funded by an interest only mortgage. The couple had two children together. An extension to the property was paid for largely by the man. During the relationship the household bills, including the mortgage payments, were shared. After almost 10 years in the property the relationship broke down. The man moved out, after which all payments were met by the woman, who maintained the property and supported the children with little or no contribution from the man. The parties did cash in a life insurance policy, dividing the proceeds, in part to enable the man to buy a property in his sole name. Subsequently, when both properties had increased in value, the man served a notice of severance in respect of the property in joint names. The woman responded by bringing a claim under the Trusts of Land and Appointment of Trustees Act 1996 in respect of both properties. At first instance the court held that the woman was entitled to 90% of the value of the first property, on the basis that this was fair and just. The man appealed.

While the court should not override the intention of the parties in favour of what the court itself considered to be fair, to the extent that the intention of the parties could not be inferred the court was free to impute a common intention to the parties that they either did not have or did not communicate to each other. It was difficult to see how that process would work if court did not supply what it thought was fair. The court was not entitled to disregard evidence of what the parties had intended, and substitute what it thought was fair, but the court could consider what was fair so as to supply any missing elements, so long as it respected the parties' intentions so far as they were apparent. Certainly, the court could not assume that two parties, who had not fully clarified their intentions as to their respective beneficial interests either initially or on the breakdown of the relationship, did not intend considerations of fairness to be relevant in determining their respective beneficial interests. In this case there was evidence of conduct from which it was right to conclude that the parties had intended their respective equal shares to alter following the man's departure, but none to indicate how. The only available criterion by which to assess the extent of the alteration was what was objectively fair, and the only judge of that was the court. The first instance judge's attribution of 90% to the woman was justifiable. The man's decision no longer to contribute to the first property had allowed him to purchase another property, on which he had made a substantial capital gain. The man's failure to contribute to child maintenance had not been taken into account in this case.