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Property law v family law: resolving the problems of family property
Published online by Cambridge University Press: 02 January 2018
Abstract
This paper compares ‘property law’ and ‘family law’ approaches to the problems associated with people who share homes, and examines some of the reform suggestions recently made in this field. The differences between property and family approaches are highlighted by recent endeavours of the Law Commission of England and Wales to devise a specifically ‘property law’ response to home-sharing, and those differences lie at the root of many of the difficulties that the Law Commission encountered in developing its abandoned scheme. It is worthwhile identifying and reflecting on those differences in order to ascertain the sort of home-sharers' problems with which each legal regime can cope, and the sort of solution that each is able to offer.
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References
1 See Mee, J The Property Rights of cohabitees (Oxford: Hart, 1999)Google Scholar; M Halliwell ‘Equity as Injustice: the Cohabitant's Case’ (1990) 20 Anglo-Am LR 500.
2 Fourteenth Annual Report (Law Corn no 97, 1978–79) para 2.32.
3 Law Com no 210, para 2.40.
4 Thirtieth Annual Report (Law Com no 239, 1995) para 6.7. See also C Harpum ‘Cohabitation Consultation’ (1995) FL 657; B Hale ‘Family Law Reform’ (1995) 48 CLP 217 at 227.
5 See eg K Everett and M Pawlowski’ Transfer of property orders and cohabitees' (1995) FL 417; and, more recently, Barlow, A Cohabitants and the Law (London: Butterworths, 3rd edn, 2001 Google Scholar) para 11.01; cf M Harper ‘Cohabitation Law reform – the way forward’ (1999) FL 435.
6 Law Com no 259, item 5(c), p 13.
7 Sharing Homes: a discussion paper (Law Corn no 278, 2002).
8 A move which attracted some unflattering headlines in the legal and lay press: ‘Law Commission ducks cohabitation issue’ (2002) 146 SJ 67 1; ‘The Law Commission's paper on rights for homesharers was a letdown’ The Times, 30 July 2002, T2 p 22; R Probert ‘Sharing Homes -a long-awaited paper’ (2002) FL 834. Marcel Berlins, at least, is one admirer: Guardian, 23 July 2002, G2 p 17 col 5. Thorpe W is also supportive: ‘Property Rights on Family Breakdown’ (2002) FL 891.
9 An opposite-sex couple may well be able to marry, provided neither is still married to another, but not (wish to) do so for various reasons; members of a same-sex couple, while each in theory able to marry, cannot marry each other, so ought for these purposes to be regarded as technically unable to marry.
10 See the government's recent suggestions:Civil Partnership: a framework for the recognition of same-sex couples (London: Women and Equality Unit, 2003).
11 Those arguments have been well ventilated elsewhere: see eg R Bailey-Harris’ Law and the unmarried couple: liberation or oppression‘?’ (1996) 8 CFLQ 137.
12 Where parties have specifically opted in to a regime, concerns about paternalistic imposition of legal protection are, at least, less applicable, but the relative ‘ranking’ of such relationships relative to marriage might still be contentious. Compare eg the generosity of the Law Society's proposed provision (see n 15 below) and the government's recommendations (n 10 above) for registered same-sex partnerships (both of which would -more or less -be marriage in All but name) and the regime proposed by Lord Lester's Civil Partnerships Bill 2002 (HL Bill 41), which would have provided very different (not least in introducing a community of property regime), and in some respects less generous, financial relief on registered-relationship breakdown than on marriage.
13 Though we shall see that two of the three schemes explored would apply equally to formal and informal relationships.
14 A Barlow and C Lind ‘A matter of trust: the allocation of rights in the family home’ (1999) 19 LS 468, referred to in the notes hereinafter as the ‘BL’ scheme.
15 Law Society Cohabitation: the case for clear law (London: Law Society, 2002).
16 See John Dewar's work on the ‘familialisation of trusts law’: ‘Land, Law and the Family Home’ in Bright, S andDewar, J (eds) LandLaw: themes and perspectives (Oxford: Oxford University Press, 1998)Google Scholar.
17 HaAlliwell, n 1 above, p 516.
18 Historically, and still, one that is criticised for its inherent gender bias against women.
19 See Lord Diplock in Gissing v Gissing [1971] AC 886 at 904; and Lord Reid in Pettitt v Pettitt [1970] AC 777 at 795, remarking that the concept of family property is alien to English law (though he goes on, of course, to suggest an heretical technique of imputing between spouses an intention to share; contrast the (increasingly weak and inherently suspect) presumption of advancement, and Waite J's comments about the parties' relationship in quantifying the interest of Mrs Cooke: Midland Bank v Cooke [1995] 4 All ER 562.
20 Law Com no 278, n 7 above, para 3.14.
21 Though the required answer to that question may increasingly be defined functionally rather than by reference to a formal status.
22 Though note the emergence in the case law of the language of ‘equality’, ‘entitlement’ and ‘compensation’, alongside ‘need’, in particular post- White v White [2001] AC 596.
23 Now resolved, it might be hoped, by the Land Registration Act 2002, s 116. 24. See also the Commonwealth jurisdictions discussed by Mee, n 1 above; and see below for discussion of the relative suitability of proprietary and personal remedies in home-sharer cases.
25 The Law Commission suggested that the formula used in s 62(3)(c) of the Family Law Act 1996 offered a useful template for identifying home-sharers: any persons living in the same household other than by virtue of one being the lodger, tenant or employee etc of the other.
26 The authors do contemplate that the scheme – or one similar to it – might also apply to other relationships which were shown to share the trust and collaboration characteristic of marital and cohabiting relationships (to which the scheme would, by contrast, apply automatically) – see their note 32 (n 14 above) -though they do not elaborate on the differences, if any, which might be required in the terms and application of their scheme to any such relationships, and the focus of their discussion is on the cases identified in the text above. Discussion of the BL scheme here will therefore be limited to its application to spouses and cohabitants.
27 Effectively defined as one whose name does not appear on the legal title, and/or who has a resulting trust share of less than 50%; the presumed sliding scale share (discussed in text above) would only take effect once it passed the share already owned on resulting trust principles by that party; the enhancement for child-carers (text above) would operate to augment that share in All cases.
28 Under the Law Society's wider proposals, same-sex partners would be able to register their relationships and thereby acquire the same rights and obligations towards each other as married opposite-sex partners. Unregistered same-sex relationships would then be treated identically to unmarried opposite-sex ones.
29 See recommendation of the Law Society, n 15 above, para 56 for definition of ‘relevant children’.
30 Maintenance payments would only be available for a limited period for the purpose of retraining or where a lump sum award could not be paid All in one go: Law Society, n 15 above, paras 109–113.
31 Though see n 26 above.
32 Law Society, n 15 above, para 74 and associated recommendation.
33 Cf John Eekelaar's suggestions for emphasising the ‘durational element’ in financial and property awards on divorce: ‘Asset distribution on divorce – the durational element’ (2001) 117 LQR 552.
34 For a useful summary of the literature addressing the economic impact of child-rearing, see P Parkinson ‘The Property Rights of Cohabitees – is Statutory Reform the Answer?’ in A Bainham, D Pearl and Pickford, R (eds) Frontiers of Family Law (Chichester: Wiley, 2nd edn, 1995) pp 314–346 Google Scholar, and the chapter in the same volume by M Oldham ‘Homemaker Services and the Law’.
35 The advantage/disadvantage principle is adopted in preference to the more wide-ranging discretion exercised by courts under the Matrimonial Causes Act 1973, Pt 11 (Law Society, n 15 above, paras 99–100) and is anticipated to generate much more modest awards than are seen there. Some commentators (eg S Wong ‘Property Rights for Home- Sharers: Equity versus a Legislative Framework?’ in Scott-Hunt, S and Lim, H (eds) Feminist Perspectives on Equity and Trusts (London: Cavendish, 2001 Google Scholar); Bailey-Harris, n 57 below) have observed that the existence of judicial discretion leaves room for discriminatory approaches to the relevance and valuation of domestic contributions, or at least for disagreement regarding the underlying principle by reference to which the discretion is to be exercised (see Parkinson, n 34 above, regarding the New South Wales courts' consideration of ‘partnership’ and ‘restitutionary’ approaches to their discretion). The Law Society scheme by articulating its express principle may be felt to offer clearer guidance to judges, though room for argument remains eg regarding the causal connection between (i) the relationship/ contributions made and (ii) advantages enjoyed by the defendant and disadvantages sustained by the claimant; and regarding the valuation of those advantages and disadvantages.
36 See the restrictions in the BL scheme, n 14 above, as to the timing of such contracts if the parties are to enjoy complete contractual freedom, and the residual discretion of the court to avoid contracts productive of ‘manifest injustice’: p 479. The Law Commission scheme would only allow contracting out which made some other express provision as to the beneficial ownership.
37 See M v M (Prenuptial Agreement) [2002] 1 FLR 654; K v K (Ancillary Relief Prenuptial Agreement) [2003] 1 FLR 120.
38 Cf the ‘deep’ protection afforded by some schemes discussed in Fox, n 90 below.
39 Contrast the ‘remedial’ constructive trust and monetary awards available in some Commonwealth jurisdictions: see Mee, n 1 above for comprehensive analysis.
40 Cf the position once the order is made: Mountney v Treharne [2002] EWCA Civ 1174; [2003] Ch 135.
41 The Law Society scheme would also include anti-avoidance provisions of the sort found in Matrimonial Causes Act 1973, s 37 which impact on some third parties.
42 Law Com no 278, n 7 above, para 3.56.
43 Law Com no 278, n 7 above, paras 3.60–3.61.
44 Law Com no 278, n 7 above, para 3.65.
45 Assessment of the propriety or otherwise of ‘charging’ for accommodation in the Law Commission examples is at the very least a culturally specific exercise: in some societies/social classes, it is quite normal for adult unmarried children to remain in the family home and household, and not something that they should be expected to pay for -but that is not to say that they should be (or are), by virtue of doing the housework (or even by contributing to the grocery bill), regarded as acquiring an interest in the bricks and mortar. However, resort to ‘charging’ for accommodation to avoid conferring a share under the scheme is perhaps an artificial way of avoiding the consequence of the premise, when it is, or may be, the premise itself which is inappropriate to the case at hand. Cf n 5 1 below for feminist criticism of the (cultural/legal) assumptions made regarding cohabiting relationships in this regard.
46 Mee, n 1 above, describes the’ two main themes' of a property law approach as being contribution and intention; it would seem that you need both, or intention alone (plus formalities required for the express creation or disposition of interests), but not contribution alone, for the law to produce desirable results here.
47 Though see Bottomley's proposals for a property law response based on imputed intentions, n 51 below.
48 Registration of a relationship would operate in an equivalent, more certain way, the parties being assumed to be consenting thereby to the legal regime attaching to registered relationships.
49 See G v F (Non-molestation Order: jurisdiction) [2000] Fam 186.
50 Though see n 26 above and discussion in the text below.
51 Some feminist commentators in particular oppose status-based laws on the basis that they make assumptions about the content of relationships and that their prescriptive tendency contributes to the persistence of damaging dependency, denying room for individual choice within relationships. See eg Anne Bottomley's criticism of Simon Gardner's conception of cohabiting relationships for the purposes of property law doctrine, and her own recommendation of a property right based on the imputed intention of the actual parties: ‘Woman and Trust(s): Portraying the Family in the Gallery of Law’ in Bright and Dewar (eds), n 16 above.
52 See Bottomley, n 5 1 above.
53 L Fox, To-ownership of Matrimonial Property: Radical Proposals for Reform’ (2001) 52 NILQ 20 at 33.
54 See R Robert quoting sources re cultural variations in different ethnic groups in the UK population: ‘Home sharing – Widening the debate’ (1999) FL 153.
55 See n 26 above.
56 Law Com no 278, n 7 above, para 3.84.
57 R Bailey-Harris’ Dividing the Assets on breakdown of relationships outside marriage: challenges for reformers' in Bailey-Harris, R (ed) Dividing the Assets on Family Breakdown (Bristol: Family Law, 1998) p 85 Google Scholar (emphasis in original).
58 Law Society, n 15 above, para 42: ‘each of these types of interdependent relationship may require different remedies and it seems unlikely that one proposal for reform will be appropriate for all ’; and Law Society, n 15 above, para 56.
59 Domestic Relationships Act 1994 (Australian Capital Territory), which even covers supportive but non-cohabiting relationships; see also Property (Relationships) Act 1984 (New South Wales), originally the De Facto Relationships Act 1984, since amended and renamed by the Property (Relationships) Legislation Amendment Act 1999 (New South Wales) to cover domestic relationships of a non-intimate nature. See Bailey-Harris recommendation, n 57 above.
60 In a statutory discretionary regime, that uncertainty can at least be mitigated to some extent by the adoption of a checklist of factors for consideration and/or an overall objective or set of guiding principles (as in the Law Society scheme). Equitable remedies in turn should be based on coherent underlying principles, though recent commentators have been sceptical of the state of current law in that regard: seen 1 above.
61 Contrast the situation on death where a surviving cohabitant does currently have remedies available in the case of intestacy or inadequate testamentary provision: Inheritance (Provision for Family and Dependants) Act 1975, as amended. In the light of Ghaidan v Godin-Mendoza [2002] EWCA Civ 1533; [2003] Ch 380 it might be anticipated that this provision will be read to include members of same-sex couples.
62 Law Corn no 278, n 7 above, para 3.97.
63 Law Corn no 278, n 7 above, para 3.98.
64 This point was made by Charles Harpum in 1982: ‘Adjusting property rights between unmarried Cohabitees' (1982) OJLS 277.
65 Though this is not the authors' position.
66 Bailey-Harris, n 57 above.
67 See eg Bottomley's preference for a property law solution, n 5 1 above.
68 Though needs remain in many quarters the preferred starting point for awards in ‘normal’ divorce cases: see the Law Society's recent paper, Financial Provision on Divorce: clarity and fairness (London, Law Society, 2003) Part 1, Proposed Guidelines.
69 This topic merits being the subject of another paper in its own right and will not be explored in detail here.
70 See Oldham, n 34 above, quoting Glendon and others.
71 See Bailey-Harris, n 57 above.
72 See J W Harris' description and discussion of labour-desert claims: Property and Justice (Oxford: Oxford University Press, 1996).
73 Le Foe v Le Foe [2001] 2 FLR 970.
74 See by analogy the evaluation by Hale J (as she then was) of the value of a claimant wife's child-care contributions in SRJ v DWJ financial provision) [1999] 2 FLR 176 at 182.
75 Harris, n 72 above.
76 Plumbers in Cambridge cost the earth, apparently; but then property prices are ludicrously high too (which is one reason why the plumbers are so expensive!), so perhaps the relative value of the home-maker's services would be about right, until the next surge or drop in the market.
77 Though that inevitably cuts off an opportunity to recognise the particular features of the individual case in a way that some commentators find objectionably stereotyping: see Bottomley, n 51 above.
78 Law Com no 278, n 7 above, para 3.66
79 [2001] 1 AC 596.
80 A perhaps optimistic hope – those inclined to litigate will always find something to litigate about, but others' practical need for litigation simply to identify the extent of their entitlement might be reduced.
81 Above, n 16.
82 Family Law Act 1996, s 30.
83 The spouse's right to occupy is automatic (and not dependent on a court order) where the criteria for the existence of matrimonial home rights are satisfied; an application to court is only required where the exclusion of the other party is sought. The ‘non-entitled’ cohabitant has no right to occupy at all without a court order, and the criteria for orders to exclude the other party are less favourable to non-entitled cohabitants than to other parties: see Family Law Act 1996, ss 36 and 38, though even these provisions do not cover same-sex couples, and there is no interpretive scope to include them: cf Ghaidan v Godin-Mendoza [2002] EWCA Civ 1533; [2003] Ch 380.
84 Occupation orders in themselves cannot prevent sale, but spouses with registered matrimonial home rights can at least bind the intervening third party with their prior occupation right, see further n 91 below; the Law Society, n 15 above, para 97, proposes occupation security against third parties for cohabitants equivalent to that enjoyed by spouses. The opportunity to discourage sale by registering an interest binding on third parties is particularly important if the cohabitant is to have a realistic chance of accessing remedies which will give him or her a more substantial interest in the property, as is currently possible in the case of certain tenancies under the Family Law Act 1996, Sch 7.
85 The BL scheme, n 14 above, would make special provision for residential security in cases involving children: p 480, the second presumption.
86 This argument assumes that there is some jurisdiction available on relationship breakdown to redistribute assets between the parties, as is currently the case for spouses under the Matrimonial Causes Act 1973.
87 As in Le Foe v Le Foe [2001] 2 FLR 970; if the assets are dissipated with the intention of avoiding the statutory scheme for ancillary relief, the relevant transactions can be undone and the assets made available for court distribution: see Matrimonial Causes Act 1973, s 37 and equivalent recommendation under the Law Society scheme.
88 Cf Bristol and West Building Society v Henning [1985] 2 All ER 606; Equity and Law Home Loans Ltd v Prestidge [1992] 1 All ER 909.
89 Irish law, eg, confers such a power on spouses under its Family Law Protection Act 1976. Note also the protective possibilities of registering pending actions and unravelling transactions intended to avoid making any provision for the claimant: Law Society, n 15 above, paras 97–98. See Fox, n 90 below for details of the sorts of vetoes etc used in other jurisdictions, usually only available to narrow categories of claimant.
90 Outside the Matrimonial Causes Act 1973, English law currently provides no means whereby a co-owner, or even a spouse (co-owning or not), can entirely prevent or invalidate a disposition made by the other party; the disposition may instead simply take effect against the vendor/mortgagor co-owner's share, and not against any existing share of the‘innocent’ party. Cf dispositions made with the intention of frustrating claims for ancillary relief: Matrimonial Causes Act 1973, s 37, and the situation in some other jurisdictions: see L Fox, ‘Reforming family property: comparisons, compromises and common dimensions' (2003) 15 CFLQ 1.
91 See recently Bank of Ireland v Bell [2001] 2 FLR 809 under the Trusts of Land and Appointment of Trustees Act 1996; for equivalent case law regarding a contest between a purchaser and matrimonial home right-holder, see Kaur v Gill [1988] Fam 110, decided under the precursor to Family Law Act 1996, ss 30–33. Recall the House of Lords' anxiety in Barclays Bank v O'Brien [1994] 1 AC 180 to maintain a balance between protection of the home and the free alienability, commercial exploitability of this major asset. For detailed discussion of this sort of proprietary protection, see Fox, n 90 above.
92 Indeed, any legislation conferring such a veto would be subject to scrutiny regarding its compatibility with the affected parties' rights, under Art 8 and Protocol 1, Art 1 ECHR, though, depending on the detail, it is conceivable that neither of these Articles might pose an obstacle to such a scheme; K Starmer notes of Art 1 that ‘private law restrictions are deemed to be defining of, rather than interferences with, property’: European Human Rights Law (London: Legal Action Group, 1999) p 641.
93 As opposed to any children: Child Support Act 199 1.
94 A fact conveniently overlooked by social security law which, by treating the couple as an economic unit for assessment purposes, presumes such economic dependence without offering any means by which it might be enforced privately by members of the partnership; contrast the courts' jurisdiction to order maintenance between spouses during marriage: Domestic Proceedings and Magistrates' Courts Act 1978. This private law remedy is rarely invoked; it is more likely that a relationship in which maintenance had become an issue would have irretrievably have broken down so that the Matrimonial Causes Act 1973 would instead be invoked for maintenance pending resolution of the financial issues arising on a divorce.
95 Of course, we need not shed too many tears for third parties, who can be expected to make use of, or simply sit back and enjoy, any or All of the manifold mechanisms available to shield them from the claims of putative sharers in the beneficial interest: see Harpum, C Megarry & Wade: The Law of Real Property (London: Sweet & Maxwell, 6th edn, 2000 Google Scholar) paras 10-031-10-032.
96 The law may (as the BL scheme, n 14 above, would) provide some immediate residential security for claimants by allowing them to remain in occupation until other suitable accommodation can be found.
97 The BL scheme, n 14 above, would apply to spouses too, and there is no suggestion by the authors of that scheme that the further remedies under the Matrimonial Causes Act 1973 ought not to continue to be available to them, so there would seem to be no reason inherent in the BL scheme to deny at least some such further relief to non-marrieds.
98 Family Law Act 1996, Sch 7; this provision applies only to opposite-sex couples, cf n 83 above.
99 Child Support Act 1991, as amended; Children Act 1989, Sch 1.
100 See recently Re P (A Child) (Financial Provision) [2003] EWCA Civ 837; [2003] 2 FCR 481.
101 Above, n 10. What reference there is to what may be called ‘informal’ relationships is rather ad hoc.
102 See A Barlow, S Duncan, G James and A Park ‘Just a piece of paper? Marriage and cohabitation in Britain’ in A Park, J Curtice, K Thomson, L Jarvis and C Bromley (eds) British Social Attitudes: the 18th Report (London: Sage, 2001) and media debate, including Panorama's report ‘The cost of living in sin’, broadcast on BBCl, 24 November 2002. It might be anticipated that same-sex couples are less likely to be under any misapprehension regarding their legal status, so that non-registration of their relationships might be regarded as more significant. But that in itself does not necessarily justify the law's making no provision for informal same-sex relationships.
103 See eg contributions to debates on Lord Lester's Civil Partnership Registration Bill 2002: Baroness Wilcox, 630 HL Official Report (5th series) col 1700,25 January 2002.
104 See the Australian legislation cited at n 59 above.
105 See the radical reforms recently instituted in New Zealand's Property (Relationships) Act 1976, as amended by the Property (Relationships) Amendment Act 2001.
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