There are many occasions, when you may buy a property jointly, with someone else. You may be buying your first home with your partner, or more uncommonly buying with a parent, sibling or even a friend. There are many considerations to think about during this time; but one which is commonly overlooked, and undervalued, is whether or to have a ‘survivorship destination’ inserted into the title you are taking to your new property.
I appreciate the vast majority of purchasers may think that there may be ‘more important’ things to consider. Be it the mortgage borrowing, examining the title to the property they are buying, or even sorting out their financing, but this is an important decision, and should not be overlooked.
So, what is a ‘survivorship destination’? Put simply, and without using too much legal jargon, when you take title to a property, the normal course of action is for each purchaser to take an equal share in the title. This means that in the situation where you are buying with a partner, you would own equal 50/50 shares in the property. The next decision that you have to make, is whether you wish to insert a provision in the title, whereby if one of you dies first, before the other purchaser(s), their share would automatically pass to the surviving purchaser(s). This is what we call a ‘survivorship destination’. I will not dwell on why it is call this, because there are other, more important things to do, such as watching paint dry, or counting bricks in a wall.
It is very important to note, at this point, that the survivorship destination operates independently of, and usurps any term to the contrary, contained with any Will that you may make. This includes any Will drafted either before, or after the purchase. Therefore, it is key that you carefully consider whether or not you want this provision expressly contained within the title.
Potential issues with survivorship destinations:-
The obvious issue, which can arise, is if both parties become estranged, and they both create new wills, leaving their one-half shares to other parties. Due to the survivorship contained within the Disposition, when they purchased the property, their newer wills would not have the desired effect of transferring their one-half share, to the intended beneficiary, under the will. Instead the estranged partner would be entitled to the said share in the property, in accordance with the survivorship provision.
Should there be a survivorship within the Disposition, in your favour, on the death of the first party, their share automatically passes to the survivor, just as it says on the tin. Nothing further needs to be done by way of drafting a formal conveyance of the one-half share, it automatically operates. It also removes the need for the obtaining of a formal grant of Confirmation from the court, in relation to the share in the property, to allow for the transfer to happen. But, in practical terms, Confirmation is often still required, so there is not much of a saving to be made.
If your title contains a survivorship, and you wish to change your minds, for whatever reason, due to its formal nature, you have to formally execute a document, expressing your desire to do so. We call this ‘evacuating the special destination’. This, again is legal jargon for getting rid of the survivorship. In these scenarios, when it is ‘evacuated’ it would then be prudent to immediately make/update your will, to ensure that your wishes for the one-half share you own are given effect to.
Wills as an alternative:-
The obvious way to overcome this issue, is rather than having a survivorship destination put in place, you can draft Wills, expressly stating whom you want your one-half share to pass to, upon your death. Wills can be changed at any point, and therefore offer a greater degree of flexibility, and are much less rigid, should that be required.
Effect of Divorce on survivorship destinations:-
In the eventuality of spouses, or civil partners divorcing, there is provision within s.19 of the Family Law (Scotland) Act (2006) and s.124A of the Civil Partnership Act (2004) which allows for the automatic evacuation of the survivorship destination by virtue of their divorce or dissolution. But, this does not apply to those who live together as if they were married, nor to spouses who separate but have not yet formally been divorced. So there is reason to be cautious in this eventuality.
Should you wish to discuss how to take title to your property, or any other conveyancing matter, please do not hesitate to contact me on 01224 588 913 or email me at firstname.lastname@example.org.
Jamie Robertson, Associate Solicitor
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