Full consideration of how a property title should be written ought to take place at the time of purchase as the consequences of a survivorship clause or “special destination” can be difficult to unravel later if the relationship fails.
When buying a house with your spouse, civil partner or even your “bidie-in”, it is usual to write the title “equally (or in some other proportions) between” the two parties. That means if one party dies their one half (or other) share of the property will be treated just like any other asset they owned – it will be part of their estate to be distributed in terms of their Will, or if there is no Will, according to the laws of intestacy.
But, titles can also be written in another way namely:-
“between” the parties “and to the survivor of them”.
This is a survivorship clause or “special destination”. In that case, if one of the owners dies, his or her share would automatically pass to the other owner who is the survivor, notwithstanding the terms of any Will or the fact that their once “dewy-eyed” relationship had hit the buffers.
Full consideration of how a title should be written ought to take place at the time of purchase as the consequences of a special destination can be difficult to unravel later if the relationship fails. Titles should always be checked when parties who own property together separate. The very thing that they wanted when they bought the property (security for their partner) may be an anathema to them now.
Special destinations can only be “evacuated” or discharged by agreement between both parties, following a sale of a property, or on a divorce or dissolution of a civil partnership. Following the breakdown of a co-habitation, the special destination will only be evacuated by agreement or following a sale of the property.
The case of Raeburn v Raeburn highlighted the need, if the title had a special destination, to transfer the title from both co-owners to the owner retaining the whole property. If only the transferor’s one half share is transferred to the owner retaining the whole property, and the owner dies before divorce or dissolution or sale, then the transferor will benefit in terms of the pre-existing special destination in the owners half share of the property. It is important therefore to have good legal advice at the point of purchasing a property together, to ensure that the title to your property is being taken in the way that best suits your needs and circumstances. You may well need to consider making a will as well. It is also important to have good legal advice at the point of your relationship breaking down.