13: Girlfriend forced to pay £200k bill after trying to cut out builder ex
It has recently been reported in the press that after an expensive, and doubtless very stressful, court dispute over a property in Wandsworth, London, worth £450,000, Chloe Thomas has been ordered to pay her ex-boyfriend £50,000, together with legal fees of £150,000.
The dispute was over whether Mr Powell was entitled to an interest in a property which they did up together. The property was registered in Ms Thomas’ sole name. Apparently, Ms Thomas had sufficient money to buy the property in 2012 for £315,000 whilst Mr Powell (who was a builder) carried out the renovation work and borrowed £14,000 for materials. The couple split in 2014 and Mr Powell claimed one third of the profit from the deal. He relied on a document drawn up by Ms Thomas’ mother in case they split up. This was doubtless to show that it was always agreed that he would have an interest. Ms Thomas denied that she had signed the contract, which she said had, in any event, been torn up by her mother when it caused friction in the family.
The judge found in Mr Powell’s favour and awarded him £50,000. She then went on to deal with the question of who should pay the substantial legal costs arising from the litigation.
The general rule in situations such as this is that the loser pays the winner’s legal costs and so, having tried and failed to argue that Mr Powell did not have an interest in the property, Ms Thomas was at serious risk of a costs order being made against her. The judge was also influenced by the fact that the previous year, Ms Thomas had turned down an offer of settlement made by Mr Powell which would have cost her £35,000, ie £15,000 less than was eventually awarded to Mr Powell.
There are various lessons to be learnt from situations such as this.
- Firstly, if you are about to enter into a co-ownership or property venture or your partner is to move into a property owned by you or carry out renovations to it, it makes sense to have the arrangement clearly documented in a document drawn up by a solicitor so that there is clear evidence as to what was agreed. Ideally, each party should receive independent legal advice before signing. This naturally involves expense which is likely to run to hundreds of pounds, but this will be much less than the legal costs involved in a subsequent court battle.
- Secondly, if you are involved in litigation of this type, or embroiled in a dispute of this nature, think carefully about your chances of success and be prepared to consider making an offer of settlement and/or engaging in mediation. Invariably negotiation is much less expensive than litigation.
- Thirdly, try and think rationally and commercially and put emotions to one side.
6 May 2016