"Equitable accounting" is the phrase that has been commonly used to determine whether or not there should be some re-adjustment of sums payable (after the court has determined whether or not each party has a share in the property; and if so what that share is - applying the principles in Stack v Dowden); normally to take account of the fact that one person has continued to live in the property and possibly continued to pay the expenses on his or her own. Such adjustments can make a significant difference to the outcome of co-ownership disputes. There are three different matters that are usually looked at:
- Occupation rent: Should the party who has remained in the property pay to the other a contribution having regard to the fact that he or she has had sole occupation of the property?
- Mortgage instalments: If one party has continued to pay a greater sum to the mortgage than the other, is he or she entitled to a contribution in respect of those payments?
- Improvements: If the party who has remained has improved the property after the other has left should that party receive some contribution in respect of those costs?
Equitable principles used to be adopted to determine whether any adjustments should be made. In Stack v Dowden the House of Lords held that the situation is now governed by ss 12 to 15 of the Trusts of Land and Appointment of Trustees Act 1996 (Lady Hale at para 94 – see also Murphy v Gooch); although the result in any given case is unlikely to be different. Lord Neuberger in Stack v Dowden:
“I think that it would be a rare case where the statutory principles would produce a different result from that which would have resulted from equitable principles”.(The notes that follow do therefore refer to some earlier cases.)
The key points arising out of the 1996 Act are as follows:
- Section 12(1) gives each beneficiary a right to occupy the land.
- Under s13 the trustees have the power to exc ... THIS IS AN EXTRACT OF THE FULL TEXT. TO GET THE FULL TEXT, SEE BELOW
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