Financial dealings between family members are often done verbally and not confirmed in writing. These dealings could be loans between family members, contributions to house purchase price, payment of private school fees etc. And sometimes when things go wrong, there is nothing in writing to confirm the agreement and it often results in “you said this but I said that” scenario. Sometimes, a party may even argue there was no intention create formal legal relations between family members so the agreement is not legally binding anyway!
Disputes, and worse, litigation over these dealings can be expensive and in a recent case I dealt with, legal fees ran into nearly £70,000 for 3 parties, and involved three firms of solicitors, three barristers and a number of court hearings. All this could have been avoided had the parties just written out the agreement between them, stated the parties' intention to create legal relations and signed the piece of paper to confirm their agreement. Better still, get solicitors to draw up an agreement and while this may cost a few hundred pounds, it’ll save a lot of acrimony, breakdown of family relationships and legal fees if anything goes wrong in the future.