Jones v Kernott — A Case Of Clarification Or Not?

Property ownership issues for cohabiting couples

The Supreme Court has recently handed down its much anticipated judgment in the case of Jones v Kernott [2011] UKSC 53. The case is notable because it deals with the ownership of property between non-married couples.

Jones v Kernott - the background information

The Jones v Kernott case concerned the rights of Leonard Kernott and Patricia Jones and their entitlement to a £245,000 property which they bought in Essex in 1985. Ms Jones paid £6,000 from her own funds with the remainder being funded through a mortgage.

Ms Jones paid the property outgoings including the mortgage and the bills, whilst Mr Kernott paid for some improvements to the property.

The couple split up in 1993. Mr Kernott moved out and made no further financial contributions to the property or to the family home. The couple cashed in a joint life insurance policy and divided the proceeds, which enabled Mr Kernott to purchase his own home in 1996.

In 2006, some 13 years after they had separated, Mr Kernott decided to seek repayment from Ms Jones for his share of the property. As a result, Ms Jones started legal proceedings to obtain a declaration that she owned the entire beneficial interest.

It was recognised that the couple owned the property equally at the point of their separation, but Ms Jones argued that Mr Kernott's beneficial interest had reduced due to his lack of financial contribution since moving out.

Court decisions

The County Court and High Court both agreed that Mr Kernott was entitled to just 10 per cent of the property value. This decision was based on the couple's financial arrangements during the time they were apart.

However, this was then overturned by the Court of Appeal, which ordered a 50/50 share on the basis of the original agreement.

Joint equity presumption

The Court of Appeal based their decision on the earlier case of Stack v Dowden [2007] UKHL 17. This previous case recognised that, in the absence of any evidence to the contrary, where people purchase a family home in their joint names the presumption is that they intend to own the property jointly in equity also.

Because Ms Jones and Mr Kernott had never talked about how they held the property, or drawn up a document indicating the same, the Court of Appeal felt that the presumption that there was an equal entitlement had not been overcome. Furthermore there was no evidence to prove the parties' joint intentions had changed after their...