Married and civil partner joint tenant court orders

With effect from 22 April 2014, there is a single Family Court for England and Wales, bringing together the three previous tiers of the family courts; the High Court, county court and magistrates' court. The Family Court, with very limited exceptions, will deal with all family cases, including applications for protection against domestic violence and matters relating to the matrimonial or family home.[1]

England and Wales is divided into geographical areas, each of which has a Designated Family Centre, which is the principal family court location for each area and to which all applications should be made. In practice, the Family Court can sit at any of the local county courts and magistrates' courts.

A tenancy can be transferred under the Matrimonial Causes Act 1973 by applying for a property adjustment order in conjunction with divorce, judicial separation, dissolution of a civil partnership or nullity proceedings. This procedure applies to any tenancy that counts as 'property' (it does not apply to statutory protected tenancies that are not interests in land. One joint tenant is ordered to transfer the tenancy to the other joint tenant spouse following the court order. The transfer is effected by assignment. The court's order does not bring about the assignment: the spouses/civil partners must ensure that a deed of assignment is executed or the tenancy will not be legally assigned.[2]

If there is a prohibition against assignment in the tenancy, the court can still order one, although it will create a breach of the tenancy conditions. In such cases, the court may be reluctant to make an order where it would constitute a clear breach of the terms of the tenancy.

The power to transfer tenancies may also apply, in extremely limited circumstances, to licences, for example a fixed-term licence or a secure licence. An important issue will be whether the licence is capable of lasting for a reasonable time so that accommodation can be provided under it in the medium to long term. In this case, the transfer would be effected by a contract agreed by the spouses or civil partners following a court order.

Statutory tenancies under the Rent Act 1977 are not capable of assignment and cannot be transferred under the Matrimonial Causes Act. Other tenancies may have prohibitions against assignment that can complicate matters. The provisions of the Family Law Act grant the courts additional powers to deal with this problem.[3]

The Act allows the courts, during divorce or dissolution proceedings or later, to 'vest' a tenancy in one of the partners, rather than ordering the tenant to transfer it. This applies to secure, protected, statutory, assured or agricultural tenancies.[4] Vesting differs from assignment in that the order of the court effectively brings about the transfer of the tenancy from one spouse or civil partner to another as if it were a conveyance. No deed of assignment is necessary when the court orders the tenancy to be vested in the other spouse or civil partner. The provisions apply only to a tenancy of property that was the matrimonial home, and not to a tenancy of property that was only intended to be the matrimonial home.[5]

There are specific criteria as to who gets the tenancy that differ from those laid down by the Matrimonial Causes Act 1973. The court must consider all the circumstances, including the:[6]

• circumstances in which the tenancy was granted

• respective housing needs and housing resources of the parties and any relevant child. Housing resources include whether either party would qualify for rehousing under homelessness or allocations legislation[7]

• respective financial resources of the parties

• likely effect on the health, safety and well-being of the two parties and of any child

• respective suitability of the parties as tenants

Compensation

The Act also allows the court to order the spouse or civil partner to whom the tenancy is transferred to pay compensation to the other.[8] If the court decides to award compensation, it may also direct that either:

• payment of the compensation is deferred until a specific date or until some specific event occurs, eg remarriage, cohabitation, moving home etc

• the compensation is paid in instalments

The court must not use the provisions to delay payment unless immediate payment would cause the new tenant greater financial hardship than the other party would suffer by having the payment deferred or paid in instalments. The directions can be varied at a later date by application to the court.

When deciding on compensation, the court must have regard to all the circumstances, including the:

• financial loss that would be suffered by the person losing the tenancy

• financial needs and resources of the parties

• financial obligations that the parties have or are likely to have in the foreseeable future, including financial obligations to each other and any children

Landlord's objections to a transfer of tenancy

If the court is considering ordering a transfer of tenancy under the Family Law Act, it must give the landlord an opportunity to be heard.[9] The court will take the landlord's view into consideration when deciding whether to order a transfer of the tenancy.

For married couples, the courts have power to either order a transfer or vest the tenancy (when proceedings for divorce, nullity or judicial separation or dissolution or nullity of a civil partnership are taken) at any time. The order cannot take effect before the decree absolute or the decree of nullity or judicial separation is granted, or before the dissolution or nullity of a civil partnership becomes final.

If a marriage ceremony is void under English law, the parties can be treated as a cohabiting couple and an order transferring the tenancy under the Family Law Act can be made when they stop living together. A void marriage has no effect on the couple’s status.[10]

Under the Matrimonial Causes Act/Family Law Act, tenancy transfers can only be made in conjunction with divorce, nullity or judicial review proceedings. Married couples or civil partners with children who are not divorcing may need to use the Children Act provisions instead. Applications can also be made under the Children Act after the marriage or civil partnership has ended, as long as the tenancy is still in existence. Under the Children Act, the court can order a tenancy to be transferred to a child or to the parent or guardian caring for the child if it is for the benefit of a child (or children) of the relationship.[11]

The tenancy must be a tenancy that can be assigned. If the landlord's consent is required, whether or not it will be given will affect the court's decision. Where an order to assign would be a clear breach of a tenancy agreement, the court may be reluctant to make such an order.

The court must consider the following factors:

• the income, earning capacity, property and other financial resources of both parties now and in the foreseeable future

• the financial needs, obligations and responsibilities of both parties now and in the foreseeable future

• the income, earning capacity, property and financial resources of the child

• any physical or learning disability of the child

• the manner in which the child was being, or was expected to be, educated or trained[12]

As the transfer is meant to be solely for the child's benefit, the court must not consider matters that specifically relate to the parents' relationship, eg the length of their relationship or their age.

The power to transfer tenancies may also apply, in extremely limited circumstances, to licences, for example a fixed-term licence or a secure licence. An important issue will be whether the licence is capable of lasting for a reasonable time so that accommodation can be provided under it in the medium to long term. In this case, the transfer would be effected by a contract agreed by the spouses following a court order.

What happens to arrears, rent liability and possession orders when the court orders a transfer will depend on which legislation the transfer is effected by.

Matrimonial Causes Act

Where a transfer under this Act takes place by way of an order to the tenant to assign the tenancy, the rules on assignment apply. This means that where there are arrears that accrued before the assignment, the original tenants (assignors) and the new tenant (assignee) are both responsible for them (this is because the new tenant (assignee) is also one of the original tenants).[13] Where arrears accrue after the assignment, if the tenancy began after 1 January 1996 the new tenant (assignee) is the only person liable for them.[14] Where the tenancy began before this date, the landlord can take action against the assignee or the assignors.

If there is a possession order in existence at the time of the assignment, the tenancy will still be subject to it. There will be no need to issue new proceedings as the new sole tenant will be one of the former joint tenants against whom proceedings were taken.

Family Law Act

Where the court orders a tenancy transfer, it can also make directions about liabilities and obligations of the tenancy. It could decide on one of the following:

• all the rights of the tenancy are transferred but subject to all covenants, obligations and liabilities[15]

• if the tenant was themselves an assignee, then when the tenancy is vested in the other spouse or civil partner, they will be bound by any agreements that the tenant was bound by, ie agreements that protected the original assignor[16]

• no obligations or liabilities can be imposed on the outgoing tenant on or after the date of the transfer, ie they cannot be held responsible for any arrears that accrue after the tenancy has been transferred[17]

The court may also order that both spouses or civil partners are jointly responsible for any arrears or other liabilities existing at the date of the order, although it could alternatively order that one partner indemnifies the other against any such payment of liabilities.[18]

Where there is a possession order in existence at the time of a Family Law Act transfer, the tenancy will remain subject to the order even after the transfer.[19] There will be no need to issue new proceedings, as the new sole tenant will be one of the former joint tenants against whom proceedings were taken.

Children Act

Tenancy transfers under the Children Act also take place by way of assignment, so the situation will be the same as for transfers under the Matrimonial Causes Act.