Running a TOLATA claim from first meeting to final hearing

This popular workshop reminded practitioners of the need for detailed evidence, careful forethought and full engagement with the CPR

Members of Resolution’s recently expanded Cohabitation Committee were pleased to be given the opportunity to present a workshop in person at this year’s National Conference in Brighton. Members of the committee – Graeme Fraser (BBS Law), Simon Sugar (barrister at 1GC Family), Samara Brackley (barrister at Pump Court Chambers), Benjamin Pitman (Peters May LLP) and myself – took the attendees through the lifespan of a TOLATA claim, from first meeting to final hearing.

Sarah Marchant speaking at Resolution’s National Conference in May 2023

Proceedings brought under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA) can be complex and require detail and precision in the making or defending of a case, as well as an understanding of pre-action conduct, alternative dispute resolution and costs. The purpose of the workshop was to touch on key considerations for practitioners dealing with cohabitees, starting with how to get the most out of a first meeting and ending with tips for Part 36 offers and what to do where there are also proceedings under Schedule 1 to the Children Act 1989.

The workshop was aimed at practitioners at all levels, including those who have recently joined the legal professional as well as family law specialists and those who may already have an established practice in this area. The workshop focused on a case study exploring the relationship of Bella and Adam who had lived together for around six years but were not married and did not have a cohabitation agreement. This is a classic scenario where one party contributed more than the other to the purchase of the property, but the other had financially contributed in other ways during the course of the relationship.

The workshop covered the information-gathering stage of collating copies of all documents, which might confirm the parties’ intentions at the time of the purchase, such as the TR1, Declaration of Trust (if there was one), the Register of Title or completion statement. There was also a reminder to consider other factors at the first meeting including domestic violence screening, arrangements for the children and interim finances. Getting the facts right at the beginning of these cases is crucial because precision and consistency will strengthen the case for both the negotiations and if the court’s involvement subsequently becomes necessary.

A crucial part of the advice to a client about commencing proceedings is to consider pre-action conduct and protocol dictated by the Civil Procedure Rules (CPR). Although family justice professionals may have a tendency to shy away from different procedural rules, those dealing with disputes arising between cohabitees must embrace the CPR with open arms. Whilst there is no specific protocol for claims under TOLATA 1996, the rules setting out pre-action conduct do apply and should not be ignored. For example, the parties are obliged to consider alternative dispute resolution to see if a settlement can be achieved without court proceedings. Those who ignore the protocols do so at their peril and must be aware of adverse cost consequences.

Various dispute resolution processes were explored during the workshop, including mediation, arbitration and early neutral evaluation. There is of course a level of flexibility in how these types of negotiations can play out and, in the context of relationship breakdown, shuttle mediation is not uncommon – allowing the parties to engage in resolving their dispute but not necessarily requiring them to be in the same room.

Having considered what needs to be done before proceedings are commenced, the workshop then took attendees through a summary of the court’s powers under TOLATA, which include the discretionary powers set out in s14 allowing the court to make orders regarding the exercise of functions of the trustees and declaration of an individual’s interest in a property. In practical terms, the court can order a sale of trust property, declare the nature and extent of an interest in a property or exercise the trustees’ functions. Bella and Adam’s case study was neatly woven so that the facts could be applied through the workshop and the speakers took the audience through an explanation of how to apply for a sale of the property or a determination of Bella’s interest in the property.

After jumping through the hoops of information gathering and alternative dispute resolution, the next step for practitioners is to consider whether an application should be made under Part 7 or Part 8 of the CPR. Most TOLATA cases are issued under Part 8 because they are cases where the court’s decision is sought “on a question which is unlikely to involve a substantial dispute of fact”. This includes straightforward orders for sale, where there is an issue over the timing of the sale and there is no dispute over beneficial interests, but other equitable remedies are claimed such as equitable accounting or for occupational rent. It may be appropriate to apply under Part 7 where the facts and circumstances are complex. This is a specialist type of application requiring allocation to the multi-track and directions dealing with disclosure, inspection, statements, costs management and expert evidence. A full exploration of Part 7 and Part 8 would have required another separate workshop, but it is hoped that the overview provided, highlighting the differences, will have been enough to encourage practitioners to consider this issue carefully and take advice from specialist counsel at the appropriate time.

The workshop’s penultimate section focused on Part 36 offers, with top tips on how to make them and a reminder of their very important role, both in negotiating a settlement and final determination of the case by the court. A reminder was given that if accepted within a certain period (called “the relevant period”), the claimant will be entitled to their costs up to the date the notice of acceptance is served. If the parties do not settle and the claimant obtains a judgment at least as advantageous as their offer, they are entitled to costs. These offers are an important tool in TOLATA cases, carrying significant cost consequences whenever they crop up.

Finally, the workshop considered the interaction between TOLATA and Schedule 1 proceedings. It is very common, in cases where unmarried couples have children, that applications may also need to be made under Schedule 1 for lump sum, property adjustment or maintenance orders, and it will usually be appropriate for both sets of proceedings to be consolidated. A question of case management will then likely arise, namely whether to follow the CPR route of case management hearings or the financial remedies structure of First Appointment, FDR and Final Hearing.

Clearly a popular topic, this workshop was one of the best attended at the conference and received glowing feedback. The case study and slides which accompanied the workshop remain available to delegates who have signed up online via the SwapCard accompanying the conference.