A Claim Of Occupation Rent In Relation To Property Held In A Deceased’s Estate

The Trustees of Land and Appointment of Trustees Act 1996 (TOLATA) allows individuals to claim Occupation Rent where they are a co-owner of a property but have been excluded from occupying that property. 

The most common example is the breakdown of an unmarried couple whereby one party continues to occupy the jointly owned property, enabling the other to claim 50% of market rent from the occupying party. In order to succeed in bringing a claim for Occupation Rent, the applicant must simply show that they have been excluded from the jointly owned property. It should be noted however that Occupation Rent is an equitable remedy and the Court is able to exercise discretion when it may appear unequitable to grant such a remedy.

The recent claim of Ali (as personal representative of Farzand Ali (deceased)) v Khatib (as personal representative of Fateh Bibi (deceased)) and others saw a claim for Occupation Rent being made in relation to a residuary beneficiary’s share of the estate containing a property.

Case background

Farzand Ali (deceased) (FA) was a residuary beneficiary to the estate of Fateh Bibi (deceased) (FB) and the applicant was the son of FA, as his personal representative. FB died in 2006 leaving the last known Will of 2003, which was later set aside leaving FB’s Will of 1997 to stand. The challenge to the 2003 Will took a number of years to resolve and during this time the property was occupied by the Defendants. A settlement was later agreed where the Defendants agreed on a price to purchase the property. However, this agreement did not prevent any claim for Occupation Rent from being made.

The applicant proceeded to pursue a claim for Occupation Rent in relation to the Defendants’ occupation of the property during the dispute. On initially hearing the case the Judge concluded there had been no exclusion on the basis the Defendants occupied the property prior to FB’s death and continued to do so after FB’s death. As no exclusion had been found the claim for Occupation Rent failed. The applicant appealed.

The appeal Judge noted that during the probate proceedings it was difficult to argue the applicant had been excluded from the property. The Judge further commented that it was unlikely the applicant would have chosen to have lived there as he occupied his own family home. On this basis, the appeal was dismissed and it was held that the Judge at the first instance was correct in exercising discretion on the claim.

Comment

This case demonstrates the difficulties an applicant may have in bringing a claim for Occupation Rent in relation to their inheritance. In order to succeed it would be expected any applicant is able to demonstrate an exclusion from the property whereby they have a right to occupy the property and real intentions to do so.