Separation Pay Off

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Golfnut

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I have a friend who is married with 18 months but their marriage is falling apart for lots of reasons. They have no children together but she has a child from a previous relationship. The family home is his house which is solely in his name and he pays the morgage completly on that himself. They have lived in this house about 13 months since it was built. She has a separate house from before the marriage which is solely in her name and she pays the morgage on that herself.

However my friend could only afford a morgage of 167k on his own and was a bit short to completly furnish the house. She used 20k of her own savings to finish the house. She also brought furniture from her house to his. She now wants out of the marriage and has told him that she will walk away if he pays her 50k.

He has inquired about a top up morgage unknowsed to her and was told that he could get 43k. Personally i don't think he can afford this as he is feeling the pinch already. I have told him to do everthing through a solicitor and not agree to anything until then.

It is fair to say that her 20k investment must have increased the value of the property. I would have thought 30k at most (50% increase on her investment) assuming that the house may be worth close to 300k.
  • But how would you estimate what she is entitled to in a settlement?
  • Where can he go to get good advice on this?
  • Should he be difficult and insist on receipts for the 20k investment and request how she arrived at a figure of 50k?
  • Should he get his house valued?
  • Should he give her back her furniture seeing as she owns it.
Regards,
Golfnut
 
he needs immediate specialist legal advice.

These things get very complicated.

I know of several couples, where the buy off was 50% of the value of the house over and above the mortgage. However, that is an agreed deal.

She may have been contributing other services to the marriage, such as housekeeping, etc. and account must also be taken of 'the value' of these services.
 
If the property originally cost x then surely a ballpark reasonable figure for her to get would be:

(20 / x) * (300 - x)

And maybe some more for the sort of thing that Ravima mentions, for providing furniture etc.

What is x? Would its value result in a figure around the €50K that she is seeking?

They would be better off agreeing this amicably between themselves if at all possible to avoid the expense and hassle of legal advice. But if that is not possible then they may need some sort of mediation or legal advice (ideally each getting their own but that will cost money!).
 
Neither improvements to the home nor unpaid work in the home give rise to what is known as a resulting trust (an entitlement to a share where none existed).

In a case in 1985 the wife contributed to the construction the family home but it was in the Husbands name, that contribution was regarded as an improvement. Amazingly enough despite the Acts that have come into force since then I'm pretty sure this is still the law (where the property is in the sole name of one party).
 
Note if the wife can establish that there was an intention to reward her with a share or that she can show that she acted to her detriment on the basis that she would gain an interest.
 
Whatever about the legalities I get the impression that the individual in this case is willing to make some sort of settlement payment but may be baulking at the €50K being requested. If they can come to some mutual agreement on a figure acceptable to both of them then that might be the best way to proceed. I would be inclined to start any bargaining around whatever my formula above gives. On the other hand it's obviously their respective prerogative to resort to the legal route if they so choose. And from what Stifster is saying it may even be that any mutually agreed payment could be overridden later if the law/statutory rights grant a more attractive settlement?
 
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