Quizzes & Puzzles27 mins ago
breach of trust/contract
In 2001 we bought a flat with cousins in which they live; funding was 65% us, 35% them. The flat was registered in their names, with our interest covered in a trust deed (unregistered on the title); our cousins are the trustees & we are all beneficiaries. The deed includes a protective provision: that the flat could be transferred at any point into all our names.
In 2005 the cousins took out an equity release (with Northern Rock � NR) using the flat as security; this was done without our consent (only informed at the "eleventh hour"). NR were not told that the flat was subject to a trust (normally NR don't accept property held under a trust), but are now not interested in unwinding the mortgage (represents a legitimate sale for them/transfer occurred "without notice"). The cousins kept the capital for their exclusive use. (Note: The Trust Deed says the purpose of the trust is to provide a home for my cousins, not security for an equity release mortgage). In 2007 we formally requested the flat be transferred into all our joint names (in line with deed provisions); however NR wouldn't allow this to occur.
We have set-out to our cousins that they are in breach of trust/contract, but they are reluctant to discharge the mortgage (penalty payments). The flat has been put up for sale but has not sold (concerned over our cousin's commitment to sell). We have suffered no financial loss, but are concerned about: additional risk inherent in the equity release; & that our cousins took action against our wishes/their fiduciary duties.
The question is: How to proceed to get our name on the title or force a sale? Relations with the cousins are now poor, and neither party is in a position to buy the other out. Solicitors have been involved but no resolution is in sight. Going to Court would be unpalatable (family connections; no losses; cost).
In 2005 the cousins took out an equity release (with Northern Rock � NR) using the flat as security; this was done without our consent (only informed at the "eleventh hour"). NR were not told that the flat was subject to a trust (normally NR don't accept property held under a trust), but are now not interested in unwinding the mortgage (represents a legitimate sale for them/transfer occurred "without notice"). The cousins kept the capital for their exclusive use. (Note: The Trust Deed says the purpose of the trust is to provide a home for my cousins, not security for an equity release mortgage). In 2007 we formally requested the flat be transferred into all our joint names (in line with deed provisions); however NR wouldn't allow this to occur.
We have set-out to our cousins that they are in breach of trust/contract, but they are reluctant to discharge the mortgage (penalty payments). The flat has been put up for sale but has not sold (concerned over our cousin's commitment to sell). We have suffered no financial loss, but are concerned about: additional risk inherent in the equity release; & that our cousins took action against our wishes/their fiduciary duties.
The question is: How to proceed to get our name on the title or force a sale? Relations with the cousins are now poor, and neither party is in a position to buy the other out. Solicitors have been involved but no resolution is in sight. Going to Court would be unpalatable (family connections; no losses; cost).
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