When a parent dies, their children may inherit a share of a jointly owned property, but the situation becomes complex if the deceased's partner continues to reside there. This scenario raises questions about the beneficiaries' rights to their inheritance and the rights of the surviving partner.

Understanding Property Ownership

The first step in navigating this situation is to determine how the property was legally owned. According to Roman Kubiak, partner and head of private wealth disputes at Hugh James law firm, properties can be held as either 'joint tenants' or 'tenants in common.'

If the property was held as joint tenants, the deceased's share would automatically pass to the surviving co-owner, assuming the agreement was not 'severed.' Severing an agreement typically occurs if both owners create wills that specifically address their individual shares.

However, if the will of the deceased parent purports to leave their share to their children, it suggests the property was likely held as 'tenants in common.' This means each owner possessed a distinct share that could be willed to heirs. Confirming this with Land Registry title documents is advisable.

Assuming tenancy in common, the inherited share passes to the beneficiaries, irrespective of the surviving partner's will, provided there are no restrictions or overriding rights granted to the partner within the deceased's will.

The Partner's Right to Reside

Owning a share of a property does not automatically grant immediate access or the right to sell that share. The deceased's will might include a 'life interest' for the surviving partner. This grants the partner the right to live in, or benefit from, the property for their lifetime, often managed through a trust, with the capital eventually passing to the beneficiaries upon the partner's death. Such a provision takes precedence over any immediate desire to sell.

Even without an explicit life interest, the surviving partner might resist attempts by beneficiaries to realize their inherited share. In cases of disagreement, legal action can be taken under the Trusts of Land and Appointment of Trustees Act 1996. Courts will consider the intentions behind the trust, including the will and the property's purpose, the interests of any children, and the co-owner's own needs. Courts are often hesitant to evict long-term, elderly residents, especially when a life interest or a clear intention for them to remain is evident.

Communication and Potential Claims

Opening a dialogue with the surviving partner is a sensible approach to understand their intentions, such as whether they wish to remain in the property or downsize. Early, tactful discussions can help prevent costly legal disputes. It is also important to consider that even if unmarried, the partner could potentially make a claim for financial provision from the deceased's estate under the Inheritance (Provision for Family and Dependants) Act 1975, particularly if they were financially maintained by the deceased or had been living with them as a couple for at least two years prior to their death. Such claims typically must be filed within six months of probate, although late claims can sometimes be permitted by the courts. The existence of a life interest for the partner may, however, diminish the likelihood or grounds for such a claim.

Understanding 'Residue Funds'

The term 'residue funds' in a will generally refers to all remaining assets in an estate after specific gifts, debts, funeral expenses, taxes, and administrative costs have been settled. It is important to check who benefits from these residue funds and in what proportions, as they may include assets beyond the property itself.