Can I keep living in the family home after my marriage breaks down?

In many situations, the answer is “yes”. If you do not already have a legal interest in the family home (whether by licence, tenancy agreement, or ownership) but your spouse does, you are automatically entitled to live in the family home. These rights are called “home rights”. The relevant legislation is the Family Law Act 1996.

It is prudent to apply for registration of your home rights at the Land Registry if the land is registered, or to apply for a Class F Land Charge if the land is unregistered. This will help protect your right to occupy should the property be sold by flagging to third party purchasers that you have a matrimonial home rights interest in the property, preventing it from being sold with vacant possession.

Home rights are personal rights. They do not by themselves give you a beneficial interest in the property (for example a share in the sale proceeds). The distinction between home rights and beneficial interests was confirmed explicitly in the recent High Court case of Mehers (as Trustee in Bankruptcy of Scherzade Khilji) v Khilji [2023] EWHC 298 (Ch). This was a case involving complex matters of insolvency and probate, but home rights were involved because Ms Khilji had registered a home rights notice at the Land Registry.

If you attempt to use the registration process for some purpose other than protecting your right of occupation (for instance, to prevent the sale of a property when you have no intention of occupying the property), your application may be refused or cancelled, and you may face financial penalties.

Your home rights will not exist forever. They will end automatically if your spouse dies or if a final divorce order is made on your marriage. They can also be terminated by the court: this is discussed further below.

The interplay between home rights and the Trusts of Land and Appointment of Trustees Act 1996 (“TOLATA”)

The court can terminate your home rights in some circumstances. For example, the court can terminate or suspend them under sections 33 and 34 of the Family Law Act if it considers it just and reasonable to do so in the context of allegations of harm by the spouse against the other occupiers/purported occupiers or any dependent children.

Similarly, under section 15 of TOLATA, the court can order the sale of property in certain circumstances. Such a sale would effectively terminate your home rights.

The interplay between home rights and TOLATA was considered in the High Court case of Fred Perry (Holdings) Ltd v Genis [2014] 8 WLUK 40. This case remains good law despite almost ten years having passed.

In that case, the court decided that the property should be sold. The spouse’s home rights would end at the time of sale.

This case concerned the Genis family home. Mr and Mrs Genis lived there with their two children aged 14 and 9, both of whom attended specialist Jewish schools in the vicinity of their home. The property was in the sole name of Mr Genis, however Mrs Genis had a beneficial interest in it (namely she was entitled to a share in the sale proceeds). She also had registered home rights.

While Mr Genis owed more than £100,000 to the claimant company, Mrs Genis had no involvement in the debt and was the innocent victim of her husband’s business failure.

The company wanted the property to be sold so that the debt could be paid as there was no other way in which the debt could be paid. The company had already taken a number of charging orders over the property as security.

Two statutes were relevant: TOLATA and the Family Law Act.

Under TOLATA, the court has a broad discretion on whether to order the sale of property. Section 15(1) of TOLATA lists various factors that the court must take into account. These include the intention of those who created the trust; the purposes for which the trust property is held; the welfare of minors; and the interest of secured creditors. TOLATA does not give guidance on the relative importance of these factors.

Under the Family Law Act, when deciding whether to terminate or suspend home rights, the court should first consider whether there is any significant harm to the applicant or any relevant child and they must then have regard to all the circumstances including the housing needs and housing resources of each party and any child; the financial resources of each party; the likely effect on the health, safety or well-being of the parties or any child and the conduct of the parties.

The court held that:

• If the matter were to be determined solely under TOLATA, priority should be given to the company’s interests, i.e. the property should be sold and the family should be required to leave the property. The judge considered this to be consistent with previous case law, which typically prioritised commercial interests above the residential security of the family unit.
  
  
• If the matter were to be determined solely under the Family Law Act, priority should be given to Mrs Genis’ interests, i.e. Mrs Genis should be allowed to retain her home rights.

The judge decided to give precedence to the company’s interests. To do otherwise would mean that that Mrs Genis would be treated differently from a partner who did not have the benefit of registered home rights. The Genis’ case should be dealt with consistently with the general legislative policy that ultimate priority be given to commercial interests.

The judge ordered the sale of the property but deferred the sale for a year to enable the defendants to relocate and make arrangements for their children’s education. This was thought to balance the competing interests of the company and the family.

The Birketts view

If you have home rights, or you believe you may have home rights, you should speak to a solicitor as soon as possible. They can advise you on your rights and assist you with protecting them.

Home rights will not necessarily protect you from the actions of third parties such as commercial creditors or mortgage lenders. Your property, and your right to occupy that property, could be at risk. If you have any concerns of that nature, you should seek specialist advice at an early stage.

Birketts benefits from specialist family and property litigation teams who work collaboratively to cover every angle.