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Equity Release - Look before you leap

posted 4 Feb 2018, 14:29 by Admin Login   [ updated 5 Feb 2018, 01:18 ]

Equity Release - Look before you leap


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Equity Release from Keith Flower Co Solicitors
ouse prices have had an incredible run. In the forty years we’ve been in Pinner, we’ve seen house prices rocket and a whole host of changes in the area.

The best things of course have been helping people to buy their own homes in which to raise their families. For many we’ve seen the kids born, attend our excellent local schools and eventually fly the nest. The next move is not always the easiest, however. We know that for many, moving to a smaller home will make perfect sense as it gives them a more manageable home and releases some of that equity tied up in the house. For some the decision is easy but for others its just too hard to leave a home with such fond memories.

That’s probably why we’ve seen increasing interest in equity release mortgages. There are two types of arrangement:

A lifetime mortgage enables you to take out a loan, secured on your home, which you receive tax free. Instead of paying interest it “rolls up” so that the original loan, plus interest, is repaid after your death.
A home reversion plan works differently. You sell a part (or all) of your home and receive a tax-free lump sum and a lifetime lease on the property. Again, there are no ongoing payments. The house is sold after your death and the lender gets back it’s percentage share.
Whilst these plans may sound attractive there are downsides. Firstly, they reduce your estate which you leave to your loved ones. Secondly, they may have an impact on any state benefits you might be entitled to.

If you’ve decided that equity release is for you, and you’ve found a lender, it’s important to have someone on your side, explaining the legal implications and helping you through the process with a minimum of fuss. At Keith Flower Solicitors we can take care of all legal aspects of equity release mortgages.

Keith Flower Solicitors – we’re here for every step of the journey

Unmarried Couples - Setting up home

posted 27 Dec 2017, 08:12 by Admin Login   [ updated 27 Dec 2017, 12:07 ]

Unmarried Couples - Setting up home with your partner


Unmarried Couples and their Rights
Moving in with your partner or buying a house together can seem like an exciting prospect. But few couples realise how risky their situation can be from a legal point of view. It may seem outdated, but unmarried couples are not protected by law in the same way that married couples or civil partners are. Common law marriage does not exist. Sadly, by the time people realise this, it is often too late - the relationship breaks down or a partner dies and it is only then they realise they do not have any legal protection.

set out below are some of the things you need to consider if you are not married or are not in a civil partnership.

It is well worth taking legal advice from Keith Flower & Company as soon as you plan to live together to find out:

  • what rights you do have;
  • where you and your partner stand in all situations; and
  • what you can do to make your position more secure.

What Keith Flower & Company will need to know

We will need a thorough briefing on your circumstances. We are likely to ask you for a variety of information including:

  • details of the history of your relationship;
  • a list of your assets and those of your partner;
  • if you own your home, what is its value is and whose name is it in
  • contributions you and your partner have made to the value of the home (including work on the       property);
  • the value of any other assets;
  • your earnings and those of your partner; and
  • whether you or your partner have any children.

Keith Flower & Company will then explain your rights and obligations. We will highlight the circumstances where you or your share of the home could be at risk and will tell you what action to consider taking to avoid this. Remember that Keith Flower & Company can only act for one partner at a time. We cannot act for both of you even if you both want this.

Things to consider

Here are some of the main areas of law that Keith Flower & Company will cover with you.

Home ownership

If you move in with someone and the house is only in their name, usually you have no right to the proceeds from selling the house. This applies unless you can prove:

  • you have contributed to the deposit for the house or the mortgage payments; or
  • you have made a financial commitment (for example, paying for major work on the house) because it was agreed you would own a share of the house.

If the house is not in your name you may have no right to continue to live there if your partner asks you to leave. Also, if the house is not in both your names, you have no right to inherit the house if your partner dies unless they have put this in their will. If they do not leave a will, you may need to make a claim against your partner's estate through the court. You will only be able to do this if you have been living together for two years or more, or you were being supported financially by your partner.

Your solicitor might recommend that the house is transferred from your partner's name into your joint names, either as 'joint tenants' or 'tenants in common'. If you own as joint tenants with your partner, you are usually entitled to one half of the net proceeds if you sell the property. And if one of you dies, the other automatically inherits the property, regardless of what is set out in your wills.

However, if you own as tenants in common, you have a right to your own share of the property but no more. By owning as tenants in common you can formally agree exactly what share of the property you each own by instructing Keith Flower & Company to draw up a 'declaration of trust'. This can prevent disagreements arising later on. If either of you wants to leave your share of the property to the other when you die, this needs to be set out in a will.

Renting together

If you are renting together, it is a good idea to have the tenancy agreement in both your names.

Children

If you have children with your partner, you need to think about what the child's surname will be and how to register their birth. It is up to you and your partner what surname you choose for your child, and you can register the child's birth jointly.

If you and your partner are not married, the mother of the child has automatic parental responsibility for the child. From 1 December 2003,  if the father is jointly registered on the birth certificate, he also has parental responsibility for the child. Otherwise, Keith Flower & Company  can help you by preparing a written agreement to share parental responsibility with your partner. This could be important later if you and your partner split up.

If you live with someone who has a child from another relationship, the law gives you no parental responsibility at all. Keith Flower & Company can explain what this means to you.

Children and separation

If you and your partner seperate and you have children together you can apply to the Child Support Agency for child support payments and to a court for various other types of financial help relating to your child. This is something you should discuss with Keith Flower & Company as soon as possible if you have or might separate from your partner.

Next-of-kin status

If your partner is ill or dies, you may not be considered as their 'next-of-kin' for medical purposes unless you and your partner make a written agreement beforehand. Keith Flower & Company can help you with this agreement.

Banking

If you and your partner have separate bank accounts, you cannot have access to money in your partner's account. If your partner dies, the money in their account will become part of their estate. This means that you will not automatically inherit the money unless this is what it says in their will.

Tax status

You and your partner will not have the same tax benefits as married couples or civil partners, especially relating to capital gains tax and inheritance tax. Unlike married couples and civil partners, you may have to pay tax if you want to give major assets to your partner.

Pension schemes

If you die, your State Pension is not automatically passed on to your partner. Different rules apply to company and private pensions, and it is best to look at these carefully with Keith Flower & Company to see exactly what level of pension you and your partner have.

Making a will

A will is a useful way of setting out what property and assets belong to you as opposed to your partner. Unless you make a will, your partner will have no automatic right to a share of your assets if you die, so it is essential to have one if you want your partner or their children to inherit.

Cohabitation contracts

These are slowly gaining recognition as a way of securing a couple's financial and other arrangements. They set out, in advance, what each member of the relationship expects of the other, both during the relationship and if they separate or one of them dies. They are 'honourable agreements', which means that not all clauses may be enforced by the courts. But they do limit disagreements and certainly provide some peace of mind.

You and your partner should both take separate legal advice before signing such an agreement.

Disagreements

Sadly, most couples don't take legal advice until the relationship fails, a partner dies or there is some other crisis. It is rarely as easy to solve a problem at this stage, but Keith Flower & Company has the knowledge and experience to protect your interests. Whether it's a simple case of checking your rights, or a complicated matter regarding the children, Keith Flower & Company will find the best solution for you within the law.


Car Parking Rights

posted 26 Dec 2017, 04:40 by Admin Login   [ updated 29 Dec 2017, 00:35 ]

Car Parking Rights - Moncrieff v Jameson 12007J. UKHL42

For some years there has been a debate about whether an easement to car parking exists. The argument goes that an easement is a right that one person enjoys over another person's land, there can be no easement which constitutes exclusive possession.

Car Parking Rights

The earliest cases which discussed this issue?, in fact, Involved storage, as in Copeland v Greenhalf [1952] Ch. 488, where a claim for an easement of storage of trailers on a narrow stretch of agricultural land failed as it amounted to a claim of exclusive possession. If exclusive possession is being claimed as a property right then this would have to arise as an estate in land.

Several Commonwealth decisions enforced this argument throughout the 1960's arid 1970's and then, in 1982, a first instance arid, unfortunately, unreported decision in Newman v Jones. This case involved parking a car on a first come, first serve basis around a block of flats The judge decided that, as there was a genuine sharing and no guarantee to an individual space, this could constitute an easement. Therefore, here there was an easement but, if there was an allocated space in which a flat owner parked there could not be an easement.

During the following twenty years, cases suggested problems but with no definite conclusions Then, starting with a commercial property case Batchelor v Marlow in 2001 and following on with a case involving residential flats Saeed v Plustrade Ltd and Another [2002], the Court of Appeal held that Newman v Jones was correct There could be no easement to park a car in an allocated space as this constituted a claim of exclusive possession which was contrary to the whole concept of an easement This was subsequently followed in two further cases Central Midland Estates v Leicester Dyers [20041 and Montrose Court v Shamash [2006]. In the latter case an easement was held to genuinely exist as there were fewer car parking spaces around the 19th Century block of flats than there were long leaseholders, and occupiers were genuinely required to share. However, again It was recognised that a right to an allocated space could not constitute an easement.

Why this distinction is important is that if a right to park in an allocated space cannot: constitute an easement and is not demised, then it cannot amount to a property right It will merely amount to a licence. This, as in Saeed v Plustrade Ltd above, will bind the original landlord/developer but will not be binding against a purchaser of the reversion Moreover, historically, car parking in relation to leaseholds which may have a major impact on value would be granted in the schedule of rights and not demised i.e.  a purported easement would be created As the majority of car parking rights give allocated spaces, this would render the lease defective.

Although cases such as Saeed v Plustrade Ltd seem to have taken time to filtrate through to practice over the past few years it has become increasingly common to demise car parking spaces in leasehold flat developments with the qualification that the developer commences the development in that manner. It is very difficult to change the developer's mind mid-way through! The service charge must also be changed as the tenant would normally be responsible for maintenance of their demise. In anything but the smallest development, a landlord would be advised to be responsible for maintenance of car parking spaces and should then be able to collect the cost via service charge.

If a development is already underway then a landlord is unlikely to accept an argument to demise car parking if existing tenants only have purported easements. Moreover, deeds of variation may not be possible in anything but the smallest developments. In this situation a landlord may be prepared to accept a deed of covenant whereby any purchaser of the reversion is bound by the car parking rights contractually. This should be supported by a restriction at the Land Registry whereby such a purchaser cannot become the new registered proprietor without the written consent of the tenant, who will give their consent if a deed of covenant is entered into.

Slowly then, things were settling down and the argument that car parking rights in allocated spaces should be demised was holding sway Then came the House of Lords decision of Moncrieff V Jamieson in late 2007 This is a Scottish case from the Outer Hebrides involving the law of servitude It is not a direct precedent in England and Wales, however, the House of Lords allowed a right to park on an allocated space as a servitude. Moreover, two of the judges including Lord Neuberger, doubted whether the previous Court of Appeal cases from England were correct. It seems that there may be such a thing as an easement to park in an allocated space after all.

Conclusion

I have already seen Moncrieff quoted by developers' solicitors as a reason for not demising car parking. It might also be noted that leaseholds, and flats in particular, contain several rights which would be defined to constitute exclusive possession, which should possibly be demised. Examples include for example, exclusive use of a balcony, storage and perhaps, most significant of all in terms of the effect on valuing a roof terraces all of which potentially could be withdrawn by a reversioner.

Note: In Virdi v Chana [2008] EWHC 280, the High Court refused to follow Moncrieff as they felt bound by the English Court of Appeal decisions.

Kettel and others v Bloomfold Ltd [2012] EWHC 1422 (Ch) - car parking in the same space all the time amounts to exclusive possession and the right should have been demised and cannot be an easement: see Batchelor v Marlow [2003] 1 WLR 764. Parking in whichever space becomes available without an absolute tight can constitute an easement. Here, the landlord gave the tenant exclusive rights to park but the tenant could be moved on management grounds. This was held to be an easement as there was no exclusive possession.

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