When siblings get greedy

Discussion in 'Legal Issues' started by bdizzle, 9th Feb, 2020.

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  1. bdizzle

    bdizzle Member

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    Greetings Brains Trust,

    I'd like to share a current situation my family experiencing with a property dispute. Hoping this doesn't happen to anyone else.

    Scenario:
    Mum (M) has 1 property (PPOR).
    Mum (M) has 3 x Children. A,B,C.
    At one point all family members were living in the house.
    A&B moved out of the house and C continued to live there.
    C decides to convince M to be on the mortgage approx 200k.
    C draws equity to purchase investment properties totalling 400k.
    C moves out of the house.
    C is now claiming 100% ownership of the property when M passess as A&B moved out and C continued with mortgage repayments.
    A&B are requesting C to take the loan portion drawn down to finance IP purchases; C is not obliging.
    No other option than to go legal.

    If anyone has any suggestions or experiences they would like to share, it would be more than welcome.

    Regards,
     
    bdizzle, 9th Feb, 2020
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  2. Trainee

    Trainee Well-Known Member

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    dont understand this part. M is sole owner. Did she take out a mortgage and onlent to C? Cross col? Guarantee?

    is M dead? Is there a will?
     
    Trainee, 9th Feb, 2020
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  3. Trainee

    Trainee Well-Known Member

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    assuming M is still alive this doesnt mean much unless C is also on the title.

    not sure what this means. What is take the loan portion?
     
    Trainee, 9th Feb, 2020
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  4. bdizzle

    bdizzle Member

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    @Trainee
    C Put him self on the mortgage.
    M is still alive.
    C is not on the title.
    Orginal mortgage from M is 200k. C Drew down equity of 200k. Mortgage is now 400k.
     
    bdizzle, 9th Feb, 2020
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  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    doesn't make sense. How can a non-legal owner mortgage a property that they don't own?
     
    Terry_w, 9th Feb, 2020
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  6. Trainee

    Trainee Well-Known Member

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    Which means C is now liable for at least half the mortgage and has no legal title to the property? Dont even know how thats possible.

    Check the names on the mortgage documents. And the will.
     
    Trainee, 9th Feb, 2020
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  7. wylie

    wylie Moderator Staff Member

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    M would have had to sign something to allow C to use her property as security?

    I agree with other posters that this doesn't make much sense. I'm wondering if the way you've described things is correct? Wording etc?

    What does M say about all this?
     
    wylie, 9th Feb, 2020
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  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Are you saying C borrowed against M's property?
    You seem to be confusing mortgages and loans.

    Generally a non-owner cannot borrow against a property they don't own as they cannot mortgage it. So perhaps M was a joint borrower with C and M gave the mortgage.
     
    Terry_w, 9th Feb, 2020
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  9. wylie

    wylie Moderator Staff Member

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    Could M have used her property to give a partial guarantee? I think the wording is confusing things.

    And depending on who is on the title, and how it is held, someone cannot just claim 100% ownership unless it is "joint tenants". Sounds messy regardless.
     
    wylie, 9th Feb, 2020
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  10. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    It could be a parental guarantee.

    Anyone can claim anything. I once claimed to be owner of Wylie's property. It didn't get any where .
    But where family are involved and finances are mixed and living in others properties it can be a real threat to claim some sort of interest in a property even though not on title. Those making the claim have the burden of proving it too.
     
    Terry_w, 9th Feb, 2020
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  11. Trainee

    Trainee Well-Known Member

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    Unfortunately a lot depends on the sophistication of the owner. Most people dont even understand the importance of a proper will.
     
    Trainee, 9th Feb, 2020
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  12. Stoffo

    Stoffo Well-Known Member

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    Am assuming you are B (stuck in the middle) ?

    Sounds like M borrowed and loaned C the funds, or went guarantor ?

    What you really need to know is if C has been servicing all the $400k loan, or just the $200k portion they are using (with M still servicing the original $200k).

    If C has been servicing the entire loan they may have some form of claim, but unless there is an existing signed loan/agreement between M & C then it could be claimed that any repayments made by C were a gift to help M out (being the loving caring son he is !)

    Further to complicate the mess, M could also claim to be partners with C in the investment properties an counter claim for her share of Capital Gains or profit made !

    Best you can do is gather as much paperwork as possible, if M is not coping you may need to consider a power of attorney.
     
    Stoffo, 9th Feb, 2020
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  13. bdizzle

    bdizzle Member

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    @Trainee , Mortgage documents have both M & C on it. C is not on the title.
     
    bdizzle, 9th Feb, 2020
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  14. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    mortgage docs? How can he mortgage an asset he does't own?
    Surely you mean the loan contract?
     
    Terry_w, 9th Feb, 2020
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  15. bdizzle

    bdizzle Member

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    @Terry_w , our thoughts exactly.
     
    bdizzle, 9th Feb, 2020
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  16. bdizzle

    bdizzle Member

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    Assumption correct, I am B.
    C had been servicing both loans whilst living there. i.e. 400k.
    M is now retired.
    As a parent, M believes we are working it out.
     
    bdizzle, 9th Feb, 2020
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  17. bdizzle

    bdizzle Member

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    Point taken.
     
    bdizzle, 9th Feb, 2020
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  18. bdizzle

    bdizzle Member

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    Will find more info next week.
    Thanks all, for contributing.
    Regards.
     
    bdizzle, 9th Feb, 2020
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  19. Stoffo

    Stoffo Well-Known Member

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    Good luck "B" ;)
    I hope all is easily resolved

    Family and finances rarely work out :( (unless it's all in writting prior)
    Sounds like M has tried to help C out, and C is taking advantage :mad:
    C may have some entitlement, only to the amount he has repaid off the original $200k
    But to lay claim to 100% of the family home is just nasty :eek:
     
    Stoffo, 9th Feb, 2020
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  20. wylie

    wylie Moderator Staff Member

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    I empathise. We had an estranged brother "try one on" and he found a lawyer/barrister willing to take his case on a "no win, no fee" basis. It's a long story, but ultimately whilst we had a really strong legal case, he was asking that we pay his lawyer/barrister plus our own, whilst his barrister threatened if we didn't settle, he would apply to unwind the wills, the trust.

    So, we settled. He got a lot of money. We got the settlement rubber stamped by a judge so (hopefully) he cannot come back and say we didn't look after him as the will directed. There is a risk that he will mismanage his windfall, so we did what we could to minimise the risk of him coming back for more.

    I've typed a lot more, but removed much of it because it is probably too much information.

    The takeaways though are -

    . Try to find a no win/no fee lawyer. My brother managed to find one. But he had a lot to gain, so that might not work depending on the size of the estate.

    . We had letters from a dementia specialist and longstanding GP that my father was of sound mind and knew what he was signing (the wills). His barrister threatened to challenge all of this, so it wasn't really worth the paper it was written on.

    . My brother clearly had been planning this all along, and by the time we got the first letter, his fees were 23k. We couldn't risk him rambling on and on and on for months on end whilst we fought it, and then be hit with a huge legal bill that he expected us to pay.

    . Whilst it was painful to go through, it's only money. That sounds flippant, but ultimately, it's the truth. I was trying hard not to let this send my crazy, railing at the injustice of it.

    . Downside is our children got absolutely nothing (financially) from their grandparents because he got their portion. His son will inherit the total that was to be split between nine grandchildren (not easy to explain, and not really helpful for you).

    . Upside is my nice brother and I never have to lay eyes on him again. That's priceless.
     
    wylie, 9th Feb, 2020
    #20
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