The Compendium

floating or qualified floating chargeholders with charges registered before 15 September 2003.

[See ‘Administration’, ‘Administrative Receiverships’, ‘Qualified Floating Chargeholders’ and ‘Insolvency Act’.]

Equitable Accounting

When couples separate and the property they lived in is divided, some reckoning is often required to determine the sums owed but arising during the period after separation (whether the house was owned as joint tenants or tenants in common).

This also applies when a Trustee in Bankruptcy is assessing the value of what is often called ‘the matrimonial home’, but is more accurately described as the property a couple live in, and lived in prior to the Bankruptcy. When the proceeds of sale are realised (either on a sale, or by the Trustee in Bankruptcy) there will have to be ‘equitable (fair) accounting’ between the parties before the money is distributed.

Equitable accounting may give one party an increased stake in the property being divided. The most common claims for a larger interest in the property are:

• Capital improvements to the property (an extension, a conservatory or major refurbishment).
• Mortgage Payments (payments towards the capital portion of the mortgage).
• Occupational rent (a claim for the amount of rent the property would obtain if both parties had moved out). Cohabiting couples have a right to possession of their co-owned property; (ie to occupy it).

An owner’s occupation of a property is ‘restricted’ if they are excluded from it. Exclusion triggers the right to an occupation rent.

If there have been capital improvements to the property, the party who has paid for the improvement is entitled to one half of the increase in the value of the property, or one half of the sum expended on the improvements.

Equally, when one party has paid the capital repayment element of the mortgage (not the interest element), they will be entitled to claim 50% of these payments