why aren't you doing this, if that's what was agreed?...at the time confirmed over email that in the event of a separation, one could buy the other out or the property would be sold and investment unwound in the order it was paid (400k back to Bank, 100k back to A, Expenses refunded and remaining profit split - if any)
I would have thought if you can prove your cash investment then this would be excluded from the settlement and the increase in the value of the property eg €50k (€550k - €500k) should be at most "split" 60/40.Hi all,
I would like to get the groups advise on the legal process when it comes to unwinding a joint property and the likely ruling that a judge would make, based on any previous cases like this.
Background
- Property purchased as 'Tenants in Common' for €500k, ownership split 60% to Party A and 40% to Party B. Based on Cash invested + half a Joint Mortgage.
- Party A invested 100k cash and 200k Mortgage (half a joint mortgage). Total 300k = 60%
- Party B invested no cash and 200k Mortgage. Total 200k = 40%
- No Ownership Agreement in place as the solicitor at the time confirmed over email that in the event of a separation, one could buy the other out or the property would be sold and investment unwound in the order it was paid (400k back to Bank, 100k back to A, Expenses refunded and remaining profit split - if any)
- Property was refurbished; Party A invested 40k, Party B invested 10k. Total Property Value now €550k
Party A and Party B have separated (unmarried), Party A lives in the property and is paying the full Mortgage for last 12mts and all property expenses. Party B never lived in the property.
Dispute
Party A has mortgage approval to take over the full debt to release Party B and values Party B's refund = €10,000 (ignoring the fact Party B is not servicing the debt)
Party B is taking the property value, deducting the Mortgage then applying the ownership per cent; 550 - 400 = 150 @40% = €60,000 (€50k profit).
What is the likely ruling by a judge? (Note; all negotiations have failed so this case is proceeding to court)
Comments greatly appreciated!
- No Ownership Agreement in place as the solicitor at the time confirmed over email that in the event of a separation, one could buy the other out or the property would be sold and investment unwound in the order it was paid (400k back to Bank, 100k back to A, Expenses refunded and remaining profit split - if any)
- Property was refurbished; Party A invested 40k, Party B invested 10k. Total Property Value now €550k
Solicitors tend to support their client (in this case, 2 solicitors both saying their client's method is correct) so it's hard to weigh it all up
If the parties purchased as tenants in common, then this would have been reflected in the purchase deed and the proceeds of any future sale would be split in accordance with the ownership split as reflected in the deed.
On the basis of what we have been told, I think Party B's solicitor is correct.
IMO Party A would be well advised to get a second opinion before proceeding - this case could end up being very expensive.
Yes but bear in mind that there is a joint mortgage in place over the property.If it is simply a question of Party B selling his share to Party A, then isn't the fair price €220k?
That would be true if Party A and Party B were married or a cohabiting couple.A court order can be used to account for adjustments to entitlements of each party and as it stands
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