Cohabitation and Property Rights for LGBTQ+ Couples: What the Law Does (and Does Not) Protect

Firstly, they will need to decide how they are going to own the property.  Assuming they are buying the property in their own names, there are two options for ownership: joint tenants and tenants in common.

Owning the property as beneficial joint tenants means that the property belongs to both Evan and Finn jointly, and they act as a single owner as they do not have a distinct share in the property. 

If one of them passes away, the property will pass directly to the surviving partner, which means that they cannot give away their share in their will.

When owning the property as tenants in common, it means that the joint owners have distinct shares. 

They can pass their share to someone else in their will, and if they die it will pass to the beneficiary of the will or under the intestacy rules.

In our case, if Evan and Finn are investing unequally in the property, then they may want to hold the property as tenants in common and enter into a declaration of trust. 

This will set out the percentages they each own, but can also deal with other considerations such as the return of the deposit in the event the property is sold.

Aside from deciding how you own the property, Evan and Finn may want to consider entering into a cohabitation agreement, which will set out how each individual will contribute to the home.

The first step in the process is to determine how the legal and beneficial interest in the property is held between the parties. Whenever land is co-owned, a trust is created, known as a trust of land. 

In this case, as the property is jointly owned as joint tenants, the presumption will be that each party will have a 50% interest in the Property. 

The transfer document itself includes a declaration of trust within it (even if the couple did not enter into a separate declaration of trust).

If there is a declaration of trust, then this is normally determinative of how the beneficial interest in the property is held. If there is no declaration of trust, which is quite rare nowadays, then the assumption is that they hold the property in equal shares.

Once it has been decided how the legal and beneficial interest in the property is held then, if the property is sold or one party decides to ‘buy out’ the other party’s interest in the property then it may be necessary for one party to pay to the other party an amount out of their share of the equity through “equitable accounting”.

Occupation rent is a notional rent charged against the occupier of a property in favour of the non-occupier. 

The occupation rent is a compensatory payment to the non-occupying party and is usually calculated as 50% of the market rent for the property.

Occupation rent is confined to cases where one party was ‘excluded’ from the home.  The court will generally approach the issue on the basis that a relationship breakdown necessitates one party to leave the property.

The general approach is that expenditure on a property without the non-occupying party’s knowledge or consent will not be credited to the payer. 

This will also relate to larger expenditures and not the general repair and maintenance of a property.

Generally, the payer may seek an account to be credited with the lesser of (a) 50% of the increase in the value of the property resulting from the expenditure or (b) 50% of the actual expenditure.