Dividing Property Between Unmarried Couples Who Break Up
In this day and age, many, many couples live together before they get married. Some choose never to officially marry at all, and enter more of a domestic partnership. For these couples, navigating how to divide jointly-owned property in the case of a break up may be more tricky. People talk about divorce and an individual’s rights in a divorce all the time – but what rights do couples have over property when a legal marriage did not take place?
A Tennessee trial court and court of appeals recently handled a case asking these very questions.
Suzanne R. Vance v. Sally Ann Blue
Ms. Vance and Ms. Blue lived in a domestic partnership for 15 years at a single family home in Nashville, Tennessee. Ms. Blue purchased the home with her own funds, but at her own direction ordered that the property be deeded to both herself and Ms. Vance as tenants in common with rights of survivorship.
The relationship became troubled. Ms. Blue was granted multiple orders of protection against Ms. Vance, and Ms. Vance only stayed at the home intermittently between 2011 and 2015. Shortly after Ms. Vance pleaded guilty to criminal charges she moved out of state.
In 2018 Ms. Vance filed an action with the court to partition the home. The action alleged that the couple was now separated and since the jointly-owned home was not suitable for partition in kind, Ms. Vance asked the court to order the sale of the property and to divide the proceeds.
Ms. Blue responded that she was owed compensation for paying more than her share in property taxes. She also claimed abandonment, and that Ms. Vance had unclean hands. In lieu of a public sale of the home, Ms. Blue asked to purchase Ms. Vance’s interest in the property.
Trial Court Ruling
The trial court found that the evidence provided established that Ms. Vance did not contribute to the purchase or maintenance of the home, Ms. Blue paid all property taxes, insurance costs, and Mortgage payments. The trial court opined that it would be inequitable to order Ms. Blue to sell the property under these circumstances, and ruled that she would be allowed to purchase Ms. Vance’s interest in the property at 5% of the property’s fair market value. The trial court found this equitable given the individuals’ contributions to the property.
Ms. Vance appealed the trial courts’ ruling, and the court of appeals did, in fact, reverse the trial court’s ruling.
Appeals Court Reversal
The appeals court points to Tennessee law, which states that jointly held property is to be portioned in kind or by sale. Partition in kind would be, for example, dividing a 10 acre lot into 2, 5-acre lots. When a partition in kind is not possible, the property must be sold. It is not in the power of the court to change that, though the court does have the ability to determine the appropriate division of sale proceeds.
This means that the trial court could not order that Ms. Blue only had to buy out Ms. Vance’s interest in the property (apparently 5% in the court’s estimation). Per Tennessee law, the house would have to be sold and the proceeds distributed. The court could, however, determine how the sale proceeds were divided by Ms. Vance and Ms. Blue. So, in theory, the trial court could rule that only 5% of the sale proceeds go to Ms. Vance.
This case highlights how impactful it can be to add another person’s name to a deed or title.
Contact Fort, Holloway & Rogers
The experienced Franklin property division lawyers at Fort, Holloway & Rogers advise clients through even the most complicated of property division issues. Contact our office today to discuss your own case or questions.
Tennessee Marital Property Division Laws (maritallaws.com)