Page 9 | My sister wants to sue me to for mortgage payments on our joint flat, even though I didn't live there

Confused20232023 · 2023-10-18T12:28:26+00:00

My sister and I bought a flat together about 6 years ago (our parents helped us with the deposit if that matters) which we lived in together. About 2 years ago we talked about selling the flat because I wanted to move in with my boyfriend. My sister couldn't afford to buy me out so we agreed that she would pay the mortgage and all bills on the flat until we sold. We have this in writing on email and Whatsapp texts, and we also discussed this with our parents. We eventually sold the flat (a whole story to itself!), and now my sister is saying that I should have paid the mortgage over the 2 years (when I wasn't living there), and is threatening to sue me to make me pay. Does she have a case if we have something in writing to say that she would pay all mortgage and bills while she lived there? I'm getting worried as we can't afford to pay her, and my boyfriend and I are planning on starting a family, so every pound counts! We are in England.

laclochette · 18/10/2023 17:02

The legal position is clear thanks to our inhouse legal team!

The moral position is much less clear. The sister can clearly see the extra costs she has incurred via her paying 100% of the mortgage. But the money that OP has lost via:

Not getting market rent for her room, due to her sister's unwillingness to take this route, which presumably would have been higher than her share of the mortgage and therefore not only cover her mortgage, but leave her with some profit (which actually, they could even have agreed use to jointly offset their shares of the mortgage, thus reducing BOTH their costs, had this felt fair)
Probably having to pay a much higher interest rate on a property she buys now versus a purchase made when she wanted to sell and repurchase, years ago

... are both things she may want to raise with her sister. And are reasons I would be reluctant to hand over money now. That said, what price a sisterly relationship. (If there is really any such thing left now that the sister has threatened to sue!)

Hindsight is a wonderful thing, but it's such a shame that while the agreement over mortgage payments was considered, decided and is captured in writing, there was no discussion about what would happen when the property was eventually sold. If the sister made this decision under the impression that paying the entire mortgage herself would change her beneficial interest in the property in her favour, she needed to make this clear and agree it with the OP...

TheGooseDrankWine · 18/10/2023 17:04

You should have let her have a higher amount from the sale of the flat - pro rata to the amount of mortgage you each paid.

Why should you have had half when you didn't pay in for half?

Frasers · 18/10/2023 17:17

I also think the op, whilst not legally required to, should have let her sister have the equity achieved in the two years she didn’t live there or pay the mortgage, morally that was the sisters. As said, I suspect that’s the real issue here.

MargotBamborough · 18/10/2023 17:18

Frasers · 18/10/2023 17:17

I also think the op, whilst not legally required to, should have let her sister have the equity achieved in the two years she didn’t live there or pay the mortgage, morally that was the sisters. As said, I suspect that’s the real issue here.

And if that is a negative figure, should her sister cover all of it?

MargotBamborough · 18/10/2023 17:19

TheGooseDrankWine · 18/10/2023 17:04

You should have let her have a higher amount from the sale of the flat - pro rata to the amount of mortgage you each paid.

Why should you have had half when you didn't pay in for half?

BECAUSE THE SISTER DIDN’T PAY THE OP RENT.

CleansUpButWouldPreferNotTo · 18/10/2023 17:22

PenguinRainbows · 18/10/2023 13:51

You had no right to half the proceeds when you didn’t contribute to the mortgage for two years.

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There was an agreement about the two years payments - why should that be overturned? If you think so, then you should also be thinking that the resident sister owes the non-resident sister two years rent on half the flat.

An agreement was reached by both sisters, with input from their parents. That would have been the time to make changes.

BalletBob · 18/10/2023 17:22

MargotBamborough · 18/10/2023 16:02

Why would that be the fair and reasonable thing? She never paid the OP rent for her half. Covering the OP's half of the mortgage WAS her rent.

Rent which the OP effectively subsidised because the sister wouldn't have been able to afford to rent an equivalent property on her own.

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That's impossible to know without knowing the value of the house, the mortgage payments each month and the rental market in that area. It also isn't what OP is arguing.

Azaleah · 18/10/2023 17:25

@Confused20232023 You need to consult a solicitor, even if she doesn't have a cause, better be safe than sorry.

In my layman's opinion, you have acted in good faith, exchanging your share of the flat for the mortgage payments, as you say you both have agreed in writing, but your sister can claim that she thought the mortgage payments would be taken into account in case of a sale.

If she's saying 'now' that you should have paid the mortgage over the 2 years you were not living there, it sounds that she has changed her mind or probably has been advised by someone else, including a solicitor, given that it took her all this time to inform you about the mortgage payments.

She had the option to sell (with you involved), rent (with you involved) or have a lodger (with or without you involved) during all the time she lived in the flat.

In terms of the exact amount of money, you can come to an agreement by calculating the total amount of mortgage payments that your sister has paid versus the total amount of rental payments that she hasn't paid (here you can argument that you have acted in good faith by not charging her for your share of the flat. Hopefully they will cancel each other out).

If this is not legally accepted, her assumption that you 'should have paid the mortgage during the 2 years' should also not be accepted, given that it was a written agreement, although not a contract, and the fact that she has paid the mortgage without taking any legal action at the time to make you pay your share clearly demonstrates that she agreed to pay the mortgage herself.

Good luck!

SuperGreens · 18/10/2023 17:26

Why was your room not rented out to cover your half of the mortgage? Was it because your sister wanted some occupancy? In that case I'm afraid that's her cost to bear.

Carpediemmakeitcount · 18/10/2023 17:28

IcedBananas · 18/10/2023 14:19

She has a good point. If she paid the mortgage for several years without you then she would be entitled to a higher percentage of the sale proceeds than you. I believe she has a case to recover that extra part of the sale proceeds from you. It was fine to agree you wouldn’t pay the mortgage but not fine to assume you would then still own half an asset that someone else has been paying for! I’d agree a sum with her and avoid yourself a lot of legal costs, stress, and family angst!

Why wouldn't her sister dispute it at the time of sale. She should have spoken to a solicitor before money was shared out. I agree with the above poster you should look at settling with her and give her something.

UnevenBalance · 18/10/2023 17:30

CorylusAgain · 18/10/2023 14:48

That's not a "benefit". Perhaps, a 'less bad' situation for those 2 years, but it still cost the sister double her expected outgoings for that period.

Presumably they decided to buy together so that neither would have to pay market rent. The OP chose to opt out of that agreement ultimately leaving her sister in the position she herself was fortunate to avoid by moving in with her boyfriend.

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But surely, that’s not because you buy something together that suddenly you have no other choice but to live there forever/until the other person is ready.

There isn’t any ethical issue behind ‘my life has changed and I now want to sell the flat’. It’s totally normal to want to opt out of that agreement.

And of you start looking at who has it better or worse, during all the time the OP has left the flat unsold, she has also not had access to the money fir herself (eg buying something else before prices went up, or whatever else she could have done).

sandyhappypeople · 18/10/2023 17:31

MargotBamborough · 18/10/2023 17:19

BECAUSE THE SISTER DIDN’T PAY THE OP RENT.

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people seem to have jumped on this but even the legal people on here are saying that the 'occupational rent' is a bit of a grey area and not a given, if you read about it, it only seems to be recognised to be due if the OP had been forced to leave:

Case law suggests that if the excluded party left voluntarily and stopped making mortgage payments, they would not win an occupational rent award.

So it's not a given that OP would be awarded this in court,.

Soontobe60 · 18/10/2023 17:31

So much misinformation on this thread!

No, she cannot ‘sue’ you at all. She has actually benefitted from your share of the equity when you left being tied up in the property for 2 years. In effect, she has had the full use of a house that she only half owns. So yes, you could have continued to pay half the mortgage but then she should have been charged half of the market rate in rent at the same time.
for example:
Mortgage payments £500 PM you pay her £250
Market rent £700PM she pays you £350

In reality, she owes you £100 a month in rent!

Imagwine · 18/10/2023 17:31

You pay your half of the mortgage payments. She pays all bills and crucially half the market rate that you’d have got if you rented the flat out.

I suspect she might end up owing you.

Imagwine · 18/10/2023 17:32

Xpost

Soontobe60 · 18/10/2023 17:32

Millybob · 18/10/2023 13:39

And your commitment to your sister should be settled before you think of starting a family - you have really behaved badly over this.

No she hasn’t!

Steev · 18/10/2023 17:34

Jesus your poor sister. I would have paid her what I owed her.

Shroedy · 18/10/2023 17:36

Steev · 18/10/2023 17:34

Jesus your poor sister. I would have paid her what I owed her.

Which, as stated repeatedly, is nothing...

MargotBamborough · 18/10/2023 17:36

BalletBob · 18/10/2023 17:22

That's impossible to know without knowing the value of the house, the mortgage payments each month and the rental market in that area. It also isn't what OP is arguing.

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It's not what the OP is arguing because as far as the OP is concerned she agreed not to sell the flat two years ago and let her sister have sole occupancy on condition that she covered the mortgage payments.

If her sister wants to change their shared agreement now and make the OP liable for two years of mortgage repayments, the OP can do likewise and charge her sister two years' rent.

She says it would have been more expensive for her sister to rent, so we can assume that the rental income would have been higher than the mortgage. It wouldn't be difficult to work out what the likely rental value would have been.

PaminaMozart · 18/10/2023 17:37

You posted in Legal Matters, @Confused20232023 but unfortunately you've had 9 pages of (mostly) layman's views.

Yours is a cautionary tale of people entering legally complex agreements without legal advice. This situation could and should have been foreseen at the time the flat was purchased. There was another opportunity to put a proper legal framework in place when you decided to move out.

As it is, neither of you are happy, both of you feel taken advantage of by the other, and there is a very real risk of your relationship with your sister being permanently fractured.

I think you should both see a solicitor together and try to thrash this out in a manner that is fair to both of you.

(IANAL...... but I suspect you'll probably have to pay at least some of the mortgage costs, so it might be wise to put trying to conceive on the backburner for the time being.)

EnoughNow2023 · 18/10/2023 17:38

You should have had the house valued at the point that you moved out and had it agreed that 50% of any equity (or loss) at that point would have been yours. Any additional equity between that point and the sale would have been 100% your sisters.
Do you think your sister would have agreed to this? If so you maybe able to get an estimate of the historical value and transfer her any additional equity. No idea if this would be less than 2 years mortgage payments but might be worth exploring) Expecting 50% of most recent sale was rather unfair if you have contributed nothing fir the past 2 years.

MargotBamborough · 18/10/2023 17:39

sandyhappypeople · 18/10/2023 17:31

people seem to have jumped on this but even the legal people on here are saying that the 'occupational rent' is a bit of a grey area and not a given, if you read about it, it only seems to be recognised to be due if the OP had been forced to leave:

Case law suggests that if the excluded party left voluntarily and stopped making mortgage payments, they would not win an occupational rent award.

So it's not a given that OP would be awarded this in court,.

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But you think it's a given that the sister would be awarded two years worth of mortgage payments in court? Having benefited from the OP's capital being tied up for two years?

MargotBamborough · 18/10/2023 17:40

EnoughNow2023 · 18/10/2023 17:38

You should have had the house valued at the point that you moved out and had it agreed that 50% of any equity (or loss) at that point would have been yours. Any additional equity between that point and the sale would have been 100% your sisters.
Do you think your sister would have agreed to this? If so you maybe able to get an estimate of the historical value and transfer her any additional equity. No idea if this would be less than 2 years mortgage payments but might be worth exploring) Expecting 50% of most recent sale was rather unfair if you have contributed nothing fir the past 2 years.

Nothing except her capital, without which her sister wouldn't have been able to remain in the house.

Iwasafool · 18/10/2023 17:40

EnoughNow2023 · 18/10/2023 17:38

You should have had the house valued at the point that you moved out and had it agreed that 50% of any equity (or loss) at that point would have been yours. Any additional equity between that point and the sale would have been 100% your sisters.
Do you think your sister would have agreed to this? If so you maybe able to get an estimate of the historical value and transfer her any additional equity. No idea if this would be less than 2 years mortgage payments but might be worth exploring) Expecting 50% of most recent sale was rather unfair if you have contributed nothing fir the past 2 years.

Why would the OP do that? Her equity was tied up in the property, her ability to get a mortgage to buy something for herself was severely restricted, she'd have had to pay extra stamp duty if she did buy somewhere else. I can't see what was in it for the OP. Your way all the advantage is to the sister.

MargotBamborough · 18/10/2023 17:41

PaminaMozart · 18/10/2023 17:37

You posted in Legal Matters, @Confused20232023 but unfortunately you've had 9 pages of (mostly) layman's views.

Yours is a cautionary tale of people entering legally complex agreements without legal advice. This situation could and should have been foreseen at the time the flat was purchased. There was another opportunity to put a proper legal framework in place when you decided to move out.

As it is, neither of you are happy, both of you feel taken advantage of by the other, and there is a very real risk of your relationship with your sister being permanently fractured.

I think you should both see a solicitor together and try to thrash this out in a manner that is fair to both of you.

(IANAL...... but I suspect you'll probably have to pay at least some of the mortgage costs, so it might be wise to put trying to conceive on the backburner for the time being.)

All the people in this thread who are actually lawyers are saying the same thing though.

Why should the OP spend money on legal advice? It's up to her sister to consult a solicitor and then actually start legal proceedings if she thinks she has a leg to stand on.