Court of Appeal Rules on Wife’s Interest in Family Home

When deciding whether someone has a beneficial interest in a property, financial contributions to the purchase price, mortgage or other costs are often important. However, as the Court of Appeal made plain in a guideline case, non-monetary contributions to establishing a house and home can also count.

The case concerned a restaurateur who received a three-year prison sentence after pleading guilty to three counts of being knowingly concerned in the fraudulent evasion of VAT. Proceedings under the Proceeds of Crime Act 2002 followed and he was found to have benefited from his crimes to the tune of over £1 million. A judge made a confiscation order against him, comprising the entirety of the equity in the home he shared with his wife of over 30 years.

In upholding the couple’s appeal against that order, the Court noted that the property was registered in the husband’s sole name. It found, however, that the judge erred in law in finding that the wife had no beneficial interest in the property. Her contribution to the household and her role as wife and mother were not irrelevant. She had given up her nursing career to raise their three children, thereby enabling her husband to focus on his career and generating income for the family.

She worked during the first 12 years of the marriage and contributed her income and some savings to the family finances. The couple’s previous family homes had been jointly owned and the unexplained decision to register the property in the husband’s name alone appeared to have been taken by him unilaterally. Although he seemed to have managed the family’s assets, a substantial portion of them represented pooled, joint money.

However devious and opaque the husband’s dealings had been over the years, there was no reason to doubt the wife’s evidence that, so far as they both were concerned, their family wealth, including their home, was jointly owned for their joint benefit. Looking at the overall picture, that mutual intention was established on the evidence. The Court varied the confiscation order so that the wife’s 50 per cent beneficial share in the property was taken out of account.

Lam v The Crown