A woman who helped her brother buy a house has been told she has no claim on the property and cannot force it to be sold to enable her to get her money back.
The house was bought in the brother’s sole name in 1999. The sister said she contributed a substantial sum of money towards the purchase on the basis of an express agreement that he would hold the property on trust for her.
She said she didn’t register an interest in the property at the time because she had complete trust in her brother and believed that he would reimburse her.
The property was then let out for about five years with the sister acting as her brother’s agent.
However, in 2004, the brother decided to move into the house with his wife. The relationship between sister and brother then broke down. The sister sought an order for the sale of the property so she could get her money back. She told the court she would not have made such a substantial contribution towards the purchase price if she had not thought she was acquiring an interest in the property.
However, the court has ruled against her. It held that, on the balance of probabilities, the money she had contributed was no more than an unsecured loan for which she had expected a substantial commercial return, to be earned from letting the property.
If it was not a loan, it was difficult to see why the property had not been purchased in both names. The sister’s claim for a beneficial interest in the property was therefore dismissed.
The case highlights the need for people to draw up the appropriate legal documents when making substantial investments of this kind. Casual verbal arrangements can become blurred and lead to disagreements several years down the line - even among close family members as in this case.
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