Help please with joint property

C

Craig R

Hi, I have read most of the posts here but have still not found an answer to my problem. My ex and I purchased land and had a house built back in 1996, we had been together for 5 years by then and we considered everything to be joint ownership. We were engaged to be married, the whole works. About 1 year after the house had been purchased, finalised and we had moved in we split up. Blah blah blah on that.
Since then I have been constantly been telling my ex to sell the house. She has paid the entire mortgage since day one and I personally put little in to the property, especially these last 6 years as I had been living in the UK. She has been threatening me with a Supreme Court order since about 2000 if I didn't accept her offer to buy me out($6000) we paid $60,000 for the land and $72,000 for the house. The property is now worth $230,000-$260,000+. I found out about 2-3 years ago that she has been renting the house out all this time, since 1998, yet she claims in her letters that this is not the case.
I flew back to Australia for the 1st time in 5 years, last year and spoke to one of my old neighbours and he said that my Ex and her now husband were permanently living up north and that the house had always had someone in it.
On arriving here again, earlier this year this time to live, I again spoke to the same neighbour and he said that the house had been rented(different to what he said the 1st time) the whole time that I had been away. She also paid about $80,000 on fixing the place up even though she knew she had not sorted this matter out.
Since about June last year she offered me $15,000 and I have been getting threatening letters from her lawyer and have tried to negotiate with them with regards to rent money owed to me plus equity in the property but they have ignored my letters and now they are trying to track me down to issue me with a Supreme Court action but they are saying they can not find me even though I gave power of attorney to someone here in Australia and I notified her lawyers of this about 10 months ago.
I spoke to Legal Aid here in West Oz back in March of this year to try and arrange mediation with her but she refused through her lawyer and my Legal Aid application was turned down. I don't have the money to fight her but I know by the advice I was given by Legal Aid that I am entitled to something. For the last 7 years I have been telling her on the phone or in writing to sell the house and she has refused and I am now worried that if she takes me to court I will lose what I believe is 50% mine(from the advise I have been given). I have tried to negotiate with this woman but feel I would be wasting my time if I continued to try and do so.

However, sorry if this is all too long, my plan is, if I can get a mortgage on the house for about $150,000 to pay off the remainder of the loan and pay her a settlement cost of $40,000, I feel that amount for her would be better than the high costs of the Supreme Court for either of us and from what I have been told to date she is not guaranteed a victory nor am I but it could go either way. The only problem I see with this is that I only have a 12 month contract with my new job that I started back in late June this year and I am only on a low income of $32000 ish including benefits, we have no debt at all only monthly bills to pay.

Any advise/help with this matter would be fantastic. I know I didn't put much in financially over the years but the house is in joint names and from what I have been told rented out for the last 6 years(rightfully so on her part to lessen the financial blow) so surely I am due 50% of the money?

Sorry again for the length of my first post here.
 
Hi Craig,

Just a couple of quick questions you might be able to answer before we can help you out...

Since then I have been constantly been telling my ex to sell the house. She has paid the entire mortgage since day one and I personally put little in to the property, especially these last 6 years as I had been living in the UK.
Click to expand...

She also paid about $80,000 on fixing the place up even though she knew she had not sorted this matter out.
Click to expand...

To someone with no knowledge of your situation, it seems like your partner has pretty much been responsible for every cent put into the property and you have contributed nothing ....

Can you specifiy exactly how much you have contributed over the years, and why you are entitled to the amounts you are claiming? What was the deposit? Have you contributed to loan payments?

Hopefully this can help forum members come up with some sort of answer for you.

Best wishes,

Jamie.
 
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ok Jamie I see where you are coming from but where I am coming from is she has been earning an income from this property for 6 years, she has had full use of this income and not split it 50-50.
I can only go by what I am told by someone that has lived next to that house for the last 7 years and knows what is going on.

Everything she has contributed after we split has been her choice, she could have sold the house back in 97 but chose not to do so. She did all the work and everything else without my knowledge so I don't see why that should be held against me?


the deposit ws about $5000 from memory that we put in. Again from what I have been told no matter who paid what it is a 50-50 partnership therefore it should be split 50-50. I was prepared however to accept less but more than $15,000. If the info I have been givin is wrong then I will stand by that. That is why I would like to clarify it with "those in the know"
 
Craig R said:
ok Jamie I see where you are coming from but where I am coming from is she has been earning an income from this property for 6 years, she has had full use of this income and not split it 50-50.
I can only go by what I am told by someone that has lived next to that house for the last 7 years and knows what is going on.

Everything she has contributed after we split has been her choice, she could have sold the house back in 97 but chose not to do so. She did all the work and everything else without my knowledge so I don't see why that should be held against me?


the deposit ws about $5000 from memory that we put in. Again from what I have been told no matter who paid what it is a 50-50 partnership therefore it should be split 50-50. I was prepared however to accept less but more than $15,000. If the info I have been givin is wrong then I will stand by that. That is why I would like to clarify it with "those in the know"
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Hi Craig,

You make some great points, but in the meantime you also provoke a few more questions...

she has been earning an income from this property for 6 years, she has had full use of this income and not split it 50-50.
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My friend, you cant have it both ways... youve already admitted you have paid NOTHING toward the mortgage, so why should you lay claim to the rent the property receives? Im afraid you cant have it both ways...

Everything she has contributed after we split has been her choice, she could have sold the house back in 97 but chose not to do so. She did all the work and everything else without my knowledge so I don't see why that should be held against me?
Click to expand...

If all you wanted was your share of the value in 1997, you would have accepted it by now, because your ex partner has already offered you more than THAT value is worth.

Can you clarify what I asked in the first reply - how much have you contributed to the property, the mortgage, and any renovations?

PS the deposit ws about $5000 from memory that we put in. Again from what I have been told no matter who paid what it is a 50-50 partnership therefore it should be split 50-50.
Click to expand...

Now this I cant fathom.... So, by your explanation, if I put in $1 and my girlfriend puts in $100,000, and we break up in 2 weeks, I am entitled to $50,000.50c?

You post has undertones of someone who is trying to do the right thing....

Hopefully youve contributed enough over the past few years to justify your claims on the property...

Thanks,

Jamie.
 
Jamie, from what I have been told, and this is all I can go on ok, if you did what you said and there was no contract saying who got what in the course of a seperation then yes you r entitled to 50%, this is what I am wanting to know if this info is correct or not?

She has, if my info is correct with regards to rental income also paid little to the mortgage and what she will have paid is tax deductible so therefore she has paid not much more than me in reality. So therefore her sole claims to the property are also questionable are they not as not all of the rent is rightfully hers?

That is therefore my contribution in mortgage payments and my claim to the property.
 
She has been paying 100% of the costs right?

You contributed "very little" right?

You expect that you are due for 50% of the rent and 50% of the increase in value? If I was your ex I would be saying "I would be a piggy on a spit roast in hell, before I would pay him 50% of the rent and 50% of the increase in value"!

How much did you contribute back in 1996? What is that plus lets say 6% pa compounded ?

Reading between the lines I think you just want to stick it to her and force her to sell the house that she likes/wants.

Take a reasonable settlement and move on! Lawyers suck (no offence to the members of the legal profession)!!
 
she doesn't want the house, she wrote to me saying the house should now be sold(sorry for just remembering this bit) but has since then ignored any of my correspondance
 
CraigR,

My two bobs worth go like this. You and your ex are making a very foolish mistake in going down the path of solicitors. I have a brother-in-law who is one and some clients of mine and they all tell me that at all costs you should steer clear if possible. I have a good friend of mine who I thought was happily married and this kind of thing happened to him. He pursued her for the money and ended in bankruptcy.
The way I see it to put it bluntly you are very lucky to be offered the $15,000. You really have not contributed at all. I know you are claiming a share of the rent for the past six years but be careful because it may be the case that the rent did not pay the mortgage and you get hit with a bill for the difference. I think you should work out exactly how much money you put in at the start including deposits and some mortgage repayments and put in a claim for those as well as a claim for a 50% share in the capital gains only after all expenses are accounted for. My guess is it won't add up to much more than $15,000 anyway.

Househunter
 
Hi Craig R,

Defacto law and family law are very different although there is an underlying push to make them the same eventually.

If you 2 were married you would more than likely be entitled to at least 50% of the marital assets upon divorce (marital assets are assets held by the both of you irrespective of whose name their in, what entity there held in or who contributed what etc, etc).

Defacto law is different. Defacto law works more on a contributions basis. It appears that you’ve contributed very little financially to this asset. The only claim you could possibly make is on a non-financial contributions basis. Non-financial contributions are in the form of, for example, you stayed at home looking after her kids from a previous relationship forgoing your career so she could go to work to earn money and therefore pay the mortgage. In these types of situations you would have a claim. If you have made very little contributions financially and non-financially you’ve got very little claim against her.

Cases such as this are usually settled out of court for basically the cost of hiring a solicitor to fight it in court ($15- $20k). That’s why she’s offering you that money because she would be up for that if it went to court anyway!!!! :)
 
Hi CRAIG R,

Mate, I just re-read your post and realised that the property is in joint names. The original intention of this asset could be seen as to her intentionally “sharing” its ownership with you.

Hmmmm, better see a solicitor. A 1-hour consultation costs about $280.
 
Ive only skimmed the thread...

If you were in a defacto relationship go for your life - maybe you can even by a porsche w/ the plates - WASHERS (its very similar to an email Ive seen)
 
OK ok.

I have a simple question. Whose name is on the title of the property? Are both names on the title?

If so are they joint tenants or tenants in common? If tenants in common, what % is allocated to each?

I see your point Craig_R.

Legally you have a course of action, but ethically and morally that course of action should not be taken, especially if you were offered a sum greater than that which you put in.

I digress, sorry. Back to the facts....

How much did you put into the property? You said you put very little in. Did you put in $5,000? More? Less?

I am curious to know, since you mentioned the "buy out" figure of $5,000.

Regards,
Boyler Room
 
We put in $10,000 as a deposit, not her not me, WE. That is all we needed for the deposit. She offered me $15,000 not $5000, to start with she offered me $2000 then $6,000 then $10,000 and lastly $15,000. Now, if she wasn't renting and I wasn't entitled to it, why was she even offering me any amount? Why did she not, if she wanted me out 7 years ago, take me to court then? I didn't take her to court then because I couldn't afford to, she could afford to take me to court as she was earning a large income at the time.
Both our names are on the title as joint tennants no percentage favoured either party. Ethics and morallity don't even come into it as she has been, based on info given to me, claiming 100% of the tax benefits and rental income of this property. So what has she really paid towards the house out of her own pocket that hasn't been already been reimbursed? Very little from my understanding. Since she decided on our behalf without consulting me, to tennant the property why should I as joint owner not be entitled to 50% of the income and equity? What I am after from this forum is information that I can then go and do homework on to then approach her with an offer based on FACT not bs.

Rightfully so she got tennants in to lessen her financial burden and I don't blame her for that, what my gripe is, is that she a)refused to settle the matter early on and b) chose to then lie to me, her lawyers and now the courts to stop me from getting what is rightfully mine not hers. If she didn't want me to get any of the profits from the property she should have resolved this matter 7 years ago, she chose not to do so. I do not want to go through the courts I want to show her that I know what she has been doing and get the documentation to prove it the legal way so she will have no choice but to deal with me.
So if I can now buy her out of the house after showing her the proof of lost rental income to me, she would then be more likely to accept my offer of $40,000 if I can get a mortgage for the property at $150,000 therefore leaving me with enough equity to further my investment plans. Then if it does go to court with all this new information it may not end up the way she thinks it will.


Some may say this is greedy and blah blah blah I don't care and yes I can very easily live with that, but they are not the ones in this situation, I am.

Plus Jamie, had I known 7 years ago what I know now about investment property I would never have told her to sell it I would have bought it off her then. I didn't though so this is where I am. She was not the smart one as you said. Sadly not everyone can get along with their previous partners like you seem to be able to do. That is life.
If I was a woman with or without kids most people would say go for what is legally, not morally, rightfully yours and take that bastard to the cleaners! Why should it be different for me?
I have moved on, with her holding on to OUR house, clearly she has not. I am sure there are other rental properties out there she could have bought long ago. She chose not to.

I know this is long winded but I fell I should get this out and I should have put more thought in to my previous post. We learn from our mistakes
 
if she is smart, however, she will let you take her to court. if it were me, i would send you a bill for half the mortgage, maintenance, additions, and require you to pay it within 14 days.

ss
 
Craig,

Correct me if I'm wrong... and I'm not... but you said that she offered to "buy you out" and you refused. Hence the legal action. I might be missing something, but that seems like she tried to "resolve" the issue to me. You refused her offer.

Don't take this the wrong way, but it appears to everyone (including me) that you've realised that you are part owner of a house that has gone up in value fairly dramatically, and now you have dollar signs in the eyes. What did you do to get this? It would seem that you didn't do anything.

I noticed your reference to "we" put $10,000 in as a deposit. Ok, so split that fairly (50-50) so your share is 5k. You admitted that you didn't contribute to the mortgage repayments so how can you be asking for any of the rental amount?

I'm not sure what her renting the place out has to do with offering you any amount of money. Now I don't know her, and I haven't heard her side of the story, but I would suggest that she offered you the $6,000 because that is probably what you contributed to the purchase.

I am curious as to where you got your advice. There are a lot of experienced investors on this forum, some of which have replied to your post, and everyone seems to agree. If you are getting your advice from an experienced solicitor, then that is good and you're obviously fairly keen to sort this out. If not, I would suggest that you take a step back for a moment and think about this situation rationally.

I don't know you, and have no feelings one way or the other toward you. I asked a couple of simple questions and made a single comment about my opinion of the ethics involved in this situation. Your reply was somewhat hostile. If it wasn't intended to be, then perhaps I misread it, but the general feeling I got from reading your post was hostility.

The people that have replied to your post have replied because they have an opinion and some information that may be able to help. It seems that the information that you have received you haven't liked too much, hence the comment about "sticking to the facts and leaving ethics and morals out of it".

Stickysandwich is right. If your ex partner has her wits about her, should this go to court, and she loses, you'll be in for a rude shock the next day. You'll be receiving a bill for 7 years of mortgage repayments, maintenance, property management fees, the works. I know if I were in her shoes, that is what i would do.

I like to play things straight, but if someone tries to screw me well then I'll play the game too.

If you have been telling her to sell the house for the last 7 years, why is it that the house isn't sold? I know you said something about not being able to afford a lawyer or to go to court (something like that).

Given that both your names are on the contract as joint tenants, it would appear that you are entitled to 50% of the value of the property. Since you don't seem to have a very good relationship with your ex partner (the co owner) you'll need to sell the property in order to split the profits. Of course, capital gains taxes come off those gains, but that wouldn't matter too much to you.

I think you'll be hard pressed to claim the rent for the period however. If you do, you may be hit with a bill for the items discussed above.

Out of curiosity, why didn't you accept her offer to buy you out for $6,000 at the beginning? And why didn't you accept the $15k?

You realise it is going to cost you both upwards of $20k to go to court?

So you paid $72k for the land and $60k for the house... $132k.

Resale: $230k (from memory)
- $10,000 (agent's fees)
Call it $90k profit.

$90k
- $25k capital gains tax (50% reduced rate because u owned it for more than 12 months)
- $20k (your court fees)
- $20k (her court fees)
= $25k
Divide that by 2 .... a whopping $12.5k

Whole lot of heartache for a measly $12.5k (in my opinion).

Why not just take the $15k and be done with it? Move on with your life and close that chapter. Would be a lot easier for everyone.

But hey, what would I know, right?

Regards,
Boyler Room
 
Great post BR- well said.

Craig, just a quick question...

She also paid about $80,000 on fixing the place up
Click to expand...

if I can get a mortgage on the house for about $150,000 to pay off the remainder of the loan and pay her a settlement cost of $40,000, I feel that amount for her would be better than the high costs of the Supreme Court
Click to expand...

You admit youve contributed almost nothing, yet you won't accept $15,000 in a settlement...

Yet your ex partner has contributed well over $80,000, and you want her to accept $40,000 in a settlement, even though the property has skyrocketed in value...

You want more than 3 times your contribution, but are offering you ex less than half her contribution, despite the fact she has been responsible for the property for the better part of a decade...

This doesnt seem incongruous to you?

Just a thought,

Jamie.
 
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