A Guide to TOLATA Claims

TOLATA claims often arise when property ownership is shared, but intentions and outcomes are not. Whether you are co-owners, cohabitees, or another interested party navigating a complex financial separation or seeking clarity over beneficial interests, understanding your rights is essential.

In this article, Property Litigation Partner Robert Richards explains what a TOLATA claim is and what one may entail. 

What is a TOLATA claim?

TOLATA is the abbreviation for the Trusts of Land and Appointment of Trustees Act 1996. This legislation governs how a court should determine a dispute in relation to a Trust of Land. A TOLATA claim is a claim brought under this legislation.

What is a Trust of Land?

A trust of land can come about in many ways and can be complex, but in simple terms it is defined as a trust of property that consists of or includes land.

A common example of this is where two or more people own property jointly. They do so as co-owners and these co-owners hold the property on a trust of land.

What are the different types of TOLATA claims?

Under TOLATA, the courts have powers to resolve many types of disputes regarding trusts of land. The two most common circumstances are:

• Co-owners who disagree about selling a property they own; all the legal owners must agree to sell but one may not want to. The court has the power to order that the land be sold.
• Where there is a dispute between co-owners or between co-owner(s) and a cohabitee as to their interest in the property; the court has the power to determine the extent of their respective interests (for example on a 50/50 or 75/25 basis).

Who can bring a claim?

Most commonly a claim would be brought by a co-owner or cohabitee but there are a wide variety of other people who can bring a claim, these include a trustee in bankruptcy, a judgment creditor who has secured a charging order over a debtor’s share of a beneficial interest in the property, or a mortgagee.

What is the step by step claims process?

Before any court proceedings are issued, the claimant (the person bringing the claim) would write to the other party setting out their case (a letter before action).

This letter must set out the grounds for the claim, the remedy being sought and provide the defendant with a reasonable period of time to reply.

The defendant is then obliged to respond confirming if the claim is disputed and if so why. If the matter remains in dispute then the parties are obliged to consider resolving their dispute through a form of alternative dispute resolution such as mediation.

It is only if this process does not lead to an agreement that court proceedings should be issued.

There are two different procedures to start a claim, one for cases that have substantial disputes of facts and the other where there are no substantial disputes of facts.

In general terms both procedures require a claim form and supporting documents to be issued at court and then served on the defendant(s). The defendant then has 14 days to respond. The court will then set a timetable leading to a trial at which a judge will determine the case.

How long does a claim take and how much does it cost?

The length of time it takes to complete a TOLATA claim will vary according to each case. There are always factors that affect the length of time cases take, for example, whether or not a defendant disputes the claim, the basis upon which they may dispute it, whether or not any expert evidence is required (e.g. to value the property) and how busy the court is to deal with and hear the case.

As a rough guide it would not be unreasonable to expect a case to take 6 to 12 months from the beginning to a final court hearing.

Legal disputes and court proceedings are expensive. It is not possible to say how much it costs to make a claim as it will depend on the circumstances of each case.

Broadly speaking however, to take a contested claim to trial is likely to cost a few tens of thousands of pounds. So, it’s important to consider the value of the property to ensure the costs and/or benefits are worthwhile.

Because litigation is an expensive process, we offer a range of funding options to help claimants fund their cases including:

• Conditional Fee Agreements (CFAs): Otherwise known as ‘no win, no fee’ agreements. We accept a lesser fee or no fee at all if you lose your case but if you win, you pay us a ‘success fee’ on top of our standard rates.
• Damages Based Agreements (DBAs): Under a DBA you pay us a percentage of the amount you recover from the claim. The fee can be anything up to 50% of the value of the claim, but no more. If you recover nothing, you pay us nothing.
• Pre-proceedings Contingency Fees: This is a variation of a DBA which can only apply before court proceedings begin. Once a case goes before the courts, a formal DBA is required.

You can learn more about our funding options here.

How are TOLATA claims decided in court?

Ultimately, if no settlement is reached between the parties then the claim will proceed to a trial before a judge. The trial judge will consider the evidence and the submissions made by each party’s legal representatives, and then make a decision.

It is important to remember that the parties can agree a settlement at any stage of the proceedings so just because a claim has been issued at court, it does not mean that it necessarily goes to trial. Most cases settle before reaching trial.

When it comes to deciding the case the court has wide discretionary powers. In exercising these powers the court will have regard to:

• The intentions of the person or people who created the trust
• The purpose for which the property subject to the trust is held
• The welfare of any minor who occupies, or might reasonably be expected to occupy, any land subject to the trust as their home
• The interests of any secured creditor of any beneficiary
• The circumstances and wishes of the beneficiaries
• Other relevant factors such as conduct

What happens after judgment?

Where the court makes an order for sale, it has powers of enforcement. It can:

• Order a party remaining in occupation to vacate;
• Order that only one party is to have conduct of the sale;
• Sign the contract for sale in circumstances where one party refuses to do so, but a purchaser has been found for the property at a reasonable price.

There are other procedures that can be used where it is anticipated that an order for sale may not be complied with. For example:

• It is possible to have an order endorsed with a penal notice meaning that a party not complying with the order will be guilty of contempt of court;
• Make an application to court seeking an order to deliver up possession;
• Issue a warrant of possession to be enforced by a court enforcement officer.

Do I have to go to court to resolve a TOLATA claim?

No, the parties are free to negotiate a settlement of the claim at any stage. As mentioned above, the parties are actively encouraged by the court rules to explore alternative means of resolving their dispute before any court proceedings are issued.

What evidence will I need?

Detailed witness evidence will need to be prepared to support the claim. This will be in the form of witness statements from relevant persons with supporting documents.

This evidence should address the factors that the court is obliged to take into account when it decides the case.

Speak to our property litigation team

TOLATA claims are rarely straightforward, but with the right legal support, they don’t have to be overwhelming. Our Dispute Resolution team is experienced in handling high-value, emotionally sensitive, and technically complex property disputes. We approach each case with precision and a commitment to outcomes that serve our clients’ best interests, whether that’s securing a rightful share or enforcing a court order.

If you're facing a dispute involving co-owned property or believe you may have a beneficial interest, contact our team today to discuss your options.

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