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The battle over property

Justice Raulston Glasgow – ruled on the property dispute

High court judge Justice Raulston Glasgow as ruled heavily in favour of the male companion of a Grenadian couple who were living in the United Kingdom but returned home to invest in property.

The two – Henry Simon and Deanne Isaac – went separate ways after spending on property in Golf Couse in South St George and also in St Andrew.

Isaac took Simon to court claiming that she was entitled to 50% of each of the property.

However, Justice Glasgow decided to award Simon 80% of the property at Golf Course and 50% of the other one based on his financial contributions to both transactions.

The judge also ordered the properties to be sold if the parties cannot come up with the funds to settle the matter.

As a public service, THE NEW TODAY has decided to reproduce the Justice Raulston Glasgow ruling in the court battle among the two disputing sides:-

[1] GLASGOW, J.: The applicant (Ms. Isaac) requests an order that she is entitled to a fifty percent beneficial interest in property with dwelling house thereon situate at Golf Course in the parish of Saint George which she jointly owns with the respondent (Mr. Simon).

[2]   In or about the year 1983, the parties became involved in a long-term relationship which produced two children who are now adults. On 23rd February 2005, the parties entered a mortgage agreement with the Grenada Co-operative Bank Limited (the bank) whereby they borrowed the sum of $243,000.00 to purchase property. On 24th February 2005, the parties purchased property together with a one storey incomplete structure thereon situate at Golf Course in the parish of Saint George for the purchase price of $105,000.00. The deed of conveyance for that property was made between one Edris Olive and Mr. Simon and Ms. Isaac. The parties were residing in London in the United Kingdom at the time of the purchase of the property.

[3]   Following the purchase of the property, the parties developed and reconstructed the same to include an upper floor and a lower floor. The upper floor, after reconstruction now consists of 3 bedrooms, 2 bathrooms. On 4th July 2005, the parties obtained further financing from the bank in the sum of $40,000.00 by way of deed of further charge. The proceeds of that further charge were used to construct self-contained apartments at the lower floor. Corporate Real Estate Services produced a valuation report dated 16th December, 2009 in which the company valued the property for the sum of $615,000.00. The parties’ claim that their relationship broke down and ended in or about 2010 or 2012.

Ms. Isaac’s case
[4]   Ms. Isaac pleads that she and Mr. Simon had an intimate relationship which lasted for many years which relationship produced two children. Ms. Isaac’s case is that in the year 2005, the parties purchased the property at Golf Course using monies obtained from a mortgage at the bank. In order to secure a mortgage to purchase the property, she and Mr. Simon opened a joint account with the bank and deposited the sum of $7,000.00. Ms. Isaac claims that this money was transferred from her personal account at First Caribbean Bank, Grenada.

[5]   Ms. Isaac states that at the time of the purchase, the property was an unfinished one storey structure. The parties agreed that the property would be used partly as their residence while residing in Grenada and as an investment property. Ms. Isaac claims that the parties shared a common intention that the upper floor would be used as a vacation/retirement home and that the ground floor would be used to generate income to cover the mortgage payments.

[6]   Further to the mortgage, the parties obtained a further loan in order to construct three self-contained apartments on the ground floor. The apartments were furnished using furniture bought on credit at Court’s Grenada Ltd in the sum of $34,055.00. Ms. Isaac claims that since 2010 she has been paying the property taxes and insurance for the property. However, she has been deprived of the use and enjoyment of the same since the relationship broke down in 2010. Therefore, she seeks a declaration that she is entitled to a half share interest in the property.

Mr. Simon’s case
[7]   In answer to the claim, Mr. Simon admits that the parties had an intimate relationship which began in 1983, and ended sometime in 2012. In or about 2004, Mr. Simon contends that he held discussions with his aunt, Edris Olive, with a view to purchasing the property. He contends that his aunt agreed to sell the property. He pleads that Ms. Isaac was not involved in these discussions and that she was not aware of the property’s state of repair or location. At the time of these discussions, the parties lived together in England.

In or about the year 2004, Mr. Simon claims that he arrived in Grenada in order to obtain a loan and inquired from Ms. Isaac whether she would assist in obtaining and repaying a loan for the property. Ms. Isaac agreed with the proposal. In furtherance of the agreement, the parties decided that they would each send monies to Ms. Isaac’s mother in Grenada as payments towards the mortgage. Mr. Simon contends that from 2005 to 2015 he gave Ms. Isaac on average GBP £300.00 per month for her to send to her mother in order to service the mortgage.

[8] Mr. Simon denies that Ms. Isaac deposited the sum of $7,000.00 into the joint account. However, he accepts that all initial payments towards the mortgage were made jointly by both parties. With respect to the further loan in the sum of $40,000.00, Mr. Simon argues that he made the majority of the payments towards repaying the same. The proceeds of the further loan were used to construct two apartments on the ground floor of the property and for the property to be fenced.

[9]   Mr. Simon accepts that both parties made payments towards property taxes. The monies were sent to Ms. Isaac’s mother for that purpose. However, when the property taxes increased, Mr. Simon states that Ms. Isaac ceased making payments and he was forced to make those payments. With respect to the property insurance, Mr. Simon claims that the monies used to pay for the property insurance came from his personal bank account and Ms. Isaac was never responsible for making those payments.

[10] Mr. Simon further avers that the bank informed him that the joint account was not being properly serviced and that the loan was in arrears. He later found out that Ms. Isaac was not depositing any money to the joint account. As a result, Mr. Simon testifies that he opened a separate bank account and instructed the bank to deduct monies from that account to service the loan. However, it was only until in or about 2014 that the bank began making automatic debits from that account. On or about 25th October 2016, Mr. Simon states that he paid the sum of GBP £31,500.00 equivalent to EC $104,512.72 to the bank thereby liquidating the loan.

[11] With respect to Ms. Isaac’s claim that she has been restricted from the property, Mr. Simon testifies that in or about 2012 he was forced to restrict her access thereto. Mr. Simon claims that Ms. Isaac:

(1) Terminated utilities;

(2) Refused to make further financial contributions toward the mortgage, utilities bills and general upkeep of the property;

(3) Forcefully entered onto the property and removed the contents thereof;

(4) Removed the outer gate of the property.

[12] Mr. Simon counterclaims for an 85% share in the property at Golf Course in the parish of Saint George and a 50% share in the property at Mirabeau in the parish of Saint Andrew.

Discussion and Analysis

The law with respect to beneficial ownership of property

[13] Counsel for Ms. Isaac, Ms. Lawrene Griffith, submits that in order to determine the various interest in the property, the court ought to look at the common intention of the parties at the time of purchase. In order to determine that interest, the court must consider the financial and non-financial contributions made by the parties1. Ms. Griffith further submits that in determining the monetary value of the parties’ shares, the court should consider the use of the post-separation income generated from the property, the parties’ unequal bargaining power and Ms. Isaac’s exclusion from the property.

Ms. Griffith argues that it is not disputed that Mr. Simon made greater contributions on the payment of the mortgage. However, it is Ms. Isaac’s case that Mr. Simon used the funds secured from renting the property to renovate and develop it.

[14] Counsel for Mr. Simon, Ms. Alicia Lawrence, relies on dicta from both the House of Lords and the Privy Council that have stated that where there is joint legal ownership there is joint beneficial ownership. Counsel contends that an onerous burden is placed on the party seeking to show that the beneficial ownership is different from the legal ownership and relies on House of Lords decision in Stack v Dowden. In satisfying that burden, Ms. Lawrence states that the court is tasked with examining the common intention of the parties.

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[15] The evidence reveals that the titles to the properties situate at Golf Course and at Mirabeau are both recorded in Mr. Simon and Ms. Isaac’s names. Therefore, the parties are deemed to be joint legal owners of both properties. It is well accepted law that where there is joint legal ownership of property there is a presumption that the beneficial ownership is also held jointly.

In Stack v Dowden, Baroness Hale stated at paragraph 56 of the judgment that:

“Just as the starting point where there is sole legal ownership is sole beneficial ownership, the starting point where there is joint legal ownership is joint beneficial ownership. The onus is upon the person seeking to show that the beneficial ownership is different from the legal ownership. So in sole ownership cases it is upon the non-owner to show that he has any interest at all. In joint ownership cases, it is upon the joint owner who claims to have other than a joint beneficial interest.” (My emphasis)

[16]   The foregoing elucidation from Stack v Dowden, instructs that the burden rests on the party who asserts that the beneficial interests in the property are disparate or unequal to establish the basis for and extent of the disparate interest.

The Golf Course property
[17] Ms. Isaac in her application seeks 50% of the beneficial share of the Golf Course property. Conversely, Mr. Simon is the party who claims that the interest is not jointly owned. He claims that Ms. Isaac’s beneficial interest should only be declared to be 15%. According to Stack v Dowden, the burden rests on Mr. Simon to prove that the beneficial interest in the Golf Course property should not be divided equally.

[18] With respect to the purchase of the property at Golf Course, Mr. Simon in his defence and counterclaim asserts that he asked Ms. Isaac to assist him to obtain and repay the loan to purchase and develop the property. Ms. Isaac acquiesced and thereafter the parties entered an arrangement whereby “every month they would each send monies to the Claimant’s mother in Grenada so that the loan payments could be made.”

Further to that arrangement, Mr. Simon explains “[o]n average the Defendant gave 300 Sterling Pound per month to the claimant from about 2005 to about 2015 for the Claimant to send to her mother for the purpose of servicing the loan.” Further, Mr. Simon pleads that “…the Defendant avers that all initial payments towards the said loan were made jointly by the Defendant and the Claimant.”

[19] Mr. Simon in his pleadings states that Ms. Isaac was not involved in the initial discussion that he had with Ms. Edris Olive to purchase the property and had no idea of the condition of the property. However, while that may be so, Mr. Simon admits that he held discussions with Ms. Isaac to join the mortgage and assist with its repayments. This is quite credible evidence of what may transpire where one partner in a relationship seeks to acquire property. Thus, even if the acquisition of the property was Mr. Simon’s idea, the evidence is clear that both parties agreed to jointly acquire the property and to enter into a mortgage to finance the acquisition.

[20] Ms. Isaac claims, in her pleadings, that she deposited the sum of $7,000.00 from her personal bank account at First Caribbean Bank in the parties’ joint account held at Grenada Co-operative Bank which was used to service the loan. Mr. Simon denies this assertion and puts Ms. Isaac to strict proof of it. I observe that apart from

Ms. Isaac’s assertion, she has not tendered any proof of that payment of $7,000.00 into the joint account.

[21] In respect of the mortgage, the bank’s offer letters dated 4th May, 2004 and 15th June, 2005 show that both parties were engaged by the bank on the terms of the mortgage. The original terms of the mortgage stated:

“Dear Mr. Simon and Ms. Isaac We are pleased to advise that your request for a loan has been approved subject to the following terms and condition.

Amount of Loan: $243,000.00

Purpose: To purchase residential property and provide additional funds for renovations.

Rate of Interest: 8.75% per annum

Terms of repayments: $2,428.66 per month inclusive of interest…

Term: 15 years…”

[22] The evidence reveals that they were co-borrowers with Mr. Simon being the principal borrower. The May 2004 offer letter states that the purpose of the mortgage was “[t]o purchase residential property and provided additional funds for renovations.” The June 2004 offer letter shows that a further sum of $40,000.00 was borrowed by the parties. The balance of the loan increased to $283,000.00; the monthly repayment to $2,500.90 and the term of years increased to 20 years.

[23] Mr. Simon pleads that on average he deposited £300.00 from 2005 to 2015 which amounts to £36,000.00 or EC $144,000.00. His evidence shows that he made monthly payments towards the mortgage on average in the sum £300.00 to £400.004   between 2004 and 2007. Between 2015 and 2016 those monthly payments increased on average to £600.00. This is clear proof of Mr. Simon’s contribution to the mortgage payments. Ms. Isaac in her evidence exhibited copies of receipts which show that in the year 2008 she deposited between $514.80 and $2,277.45 which is equivalent to approximately £100.00 and £400.00 given the currency exchange rates of £1 to EC as stated in the bank’s receipts. Ms. Isaac further states that she ceased making payments toward the mortgage in 20116.

Further, I accept Mr. Simon’s pleading that the initial payments towards the mortgage were made jointly by the parties. I assess her average monthly contributions to be about £350.00 up to 2011 as £25,200.00 or EC $100,800.00.

[24] The totality of the evidence, including Mr. Simon’s admission that initially the parties jointly contributed toward the repayments to the mortgage suggests that both parties jointly made repayments to the mortgage up to 2011. However, the parties’ financial contributions in this regard were markedly unequal. Additionally, it was Mr. Simon who was left to make the further payments to the mortgage when Ms. Isaac ceased contributing to the same. Further, the evidence shows that it was Mr. Simon, who sometime in October 2016 paid the bank the sum of £31,500.008 or EC $104,512.72 to liquidate the outstanding mortgage sum in full. In sum, Mr. Simon’s contribution to the mortgage repayments far outweigh those of Ms. Isaac.

Contributions to the property’s upkeep
[25]   Ms. Isaac states in her pleadings that she paid the sum of $34,055.00 to Courts Grenada Ltd for furniture which was bought for the house. Mr. Simon denies this and answers that he made most of the payments to Courts. The document produced from Courts Ltd (Grenada) do not disclose which party made those payments to the parties’ account held with the company. Mr. Simon alleges without contestation from Ms. Isaac and I so accept that sometime in 2011, Ms. Isaac entered the property and removed all of the furniture and other household items. Neither party has presented sufficient evidence to conclude or attribute any or all of the Courts payments to either party. Therefore, I find that on a balance of probabilities the payments to Courts were a joint effort by both parties.

[26] Ms. Isaac then presents property tax statements and asserts that she solely paid the property taxes from the year 2010 to present and that she paid the utility bills and property insurance. Again, the evidence provided by Ms. Isaac does not state who made those payments. The receipts merely state that the payments were received on behalf of both parties. Therefore, I am unable to assess these payments as sole contributions by Ms. Isaac. I find that the above payments were made jointly by the parties.

Rental Income of the property
[27] Ms. Isaac pleads that property was rented from 2005 to present to several persons yielding rental income in excess of $70,000.00. Ms. Lawrence alludes to Ms. Isaac’s efforts to rely on the rental income of the property in her attempts to quantify her contribution. However, as rightly stated by Ms. Lawrence, at no point has Ms Isaac provided clarity on how she arrived at this sum. I agree with Ms. Lawrence that Ms. Isaac has failed to plead, particularise and prove her evidence that the property yielded yearly rental income of $70,000.00.


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