The one where you make a Will without realising it…
Buying your first house (or your second, or third) is an exciting time. Home ownership brings with it lots of opportunities, as well as responsibilities. Choice of wallpaper, new kitchens, outside entertaining space. So many things to think about, that, when the lawyer asks you if you want to take the title in the joint names of yourself and your partner, with a survivorship destination, you just say yes without thinking too much about it, reassured that if you die, your partner isn’t going to be homeless.
I’m not sure if you realise it or not, but what you have done here is effectively made a Will in relation to your share of the house. Whilst you haven’t made a traditional Will, written as a separate document, you have effectively bequeathed your asset to your partner on your death. The title to the house has been registered in the Land Register for Scotland and the title contains a statement of what happens if one of the joint owners dies – their share automatically passes to the surviving joint owner without the need for any further legal process.
Now, whilst this is very possibly be what you would want to happen anyway, there are various things that concern me.
· Firstly, and most importantly, did you understand what you were agreeing to at the time of buying your house? Did your lawyer make a point of explaining the implication of the survivorship destination?
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Secondly, it’s not as easy to change the title
to the house as it is to change your Will. Best practice would demand a new
title being registered without the survivorship destination.
· Thirdly, there are many circumstances where you might want to leave your interest in the property to someone other than your partner, e.g. for tax planning reasons or for care home fee planning reasons, perhaps leaving your interest to a Trust or directly to your children. This might lead to a conflict between what you have written in your Will and what is contained in the title to the house. A check of the title deeds should always be carried out when writing a Will.
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Fourthly, it can cause havoc if not treated
properly on divorce or separation. I have heard of cases where, despite one
party having moved out and conveyed their interest in the house to the other, the
survivorship destination still operates on death for the benefit of the person
who has left.
It’s fair to say that I am not a fan of survivorship destinations, because for every one that works for the benefit of the joint owners, there are many more that cause complications which cost time and money to sort out. So my advice is to be very sure when buying property that you know and understand the implications and agree to it before any survivorship destination is included in your title. As always, consult an experienced solicitor for advice.
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