The parties, a married couple disputed the shares in which the matrimonial home, formerly held by them as joint tenants would be held after severance o that joint tenancy.
Held: The wife was entitled to a half share in the property.
Russell LJ considered that the court had no jurisdiction under section 17 of the 1882 Act to find that the wife had any beneficial interest other than one equal to that of the husband. He said: ”If a freehold is conveyed to A and B on trust for themselves as joint tenants, each has the same beneficial interest in that property as the other. That is inherent in the nature of the beneficial interest created, as is the right to the whole on survivorship before severance. It is also inherent in the nature of the beneficial interest created that either may sever at any time inter vivos-, and on severance the beneficial joint tenancy becomes a beneficial tenancy in common in undivided shares and right by survivorship no longer obtains. If there be two beneficial joint tenants, severance produces a beneficial joint tenancy in common in two equal shares . . by declaration of the beneficial joint tenancy between A and B, their respective rights and titles are no less clearly laid down and established than if there had been a declaration of a beneficial tenancy in common in equal undivided shares.’
Lord Denning MR, delivering the leading judgment took a strong line of his own, saying: ‘Although the court refused a sale, we are asked to determine what is the wife’s share in the property. I do not think that the fact that they were joint tenants means that, on a sale, she necessarily takes a half share. That is decisively shown by the decision of this court in Hine v. Hine. I would refer particularly to the wise observations of Pearson LJ. That decision was distinguished by Russell, LJ, in Wilson v Wilson, on the ground that the conveyance in Hine v. Hine did not contain an express declaration of trust for the two jointly: but I for myself assumed that it did, because a declaration of trust is common form: see Smith v. Smith and Brown v. Brown and s.36(1) of the Law of Property Act 1925. The mere insertion of a declaration of trust (which would be imported anyway) cannot make any difference. Notwithstanding the criticisms that have been made of Hine v. Hine, it is, I think, still good law. In that very case, Pearson, LJ, pointed out that a half-and-half division would not have produced a fair and just result, whereas decisions of this court did achieve a reasonable result. I would, myself, hesitate long before I overthrew a case which did’ justice: but suffice it to say that it is binding on this court and none of us can overthrow it. In this situation, I have had great doubt whether we should interfere with the decision of the judge who relied on Hine v. Hine, but my brethren think that we should, and I concur on the ground that there is solid ground for believing that the parties did intend that, come what may, the proceeds of the sale of the property (when it should happen) should be shared equally. I say this because of the form of the latest accounts which were agreed by the husband with the accountants after the disputes had arisen. They showed the property as belonging half-and-half to each.’
Lord Justice Davies, said that he could see no distinction in principle between a declaration of trust of the nature under discussion and a mere conveyance into joint names, and: ‘From the many and sometimes conflicting authorities the principle, in my judgment, emerges that, in proceedings under s.17 of the Act of 1882 between husband and wife, the form of a transaction is not conclusive. In enquiring into the title to property, the court must investigate the reality of the situation and, having done so and having ascertained the facts, must make such order as it thinks fit. So that, whatever the documents may appear to say on their face, the court may reach the conclusion that, in reality, by express or implied agreement the true position was something different from that appearing on the face of the documents. Unless, however, the court is satisfied on evidence that the parties expressly or by conduct did agree to a state of affairs other than that indicated by the documents, then the documents must prevail. It may be that it is more difficult to go behind a declaration of trust than a conveyance. It may be that practical difficulties may arise in any given case; but I do not think that there is any authority for the proposition that, in no circumstances as between husband and wife where no third party interest is concerned, can the court look behind the form of the documents.’
Nevertheless, he concluded that since there was no evidence of any agreement between the parties that the property should be owned otherwise than in equal shares, the wife was entitled to a half- interest in the property.
Judges:
Lord Denning MR, Russell LJ, Davies LJ
Citations:
[1965] 2 QB 666, [1965] 3 All ER 307
Statutes:
Married Women’s Property Act 1882 17
Jurisdiction:
England and Wales
Cited by:
Cited – Stack v Dowden HL 25-Apr-2007
The parties had cohabited for a long time, in a home bought by Ms Dowden. After the breakdown of the relationship, Mr Stack claimed an equal interest in the second family home, which they had bought in joint names. The House was asked whether, when . .
rejected – Goodman v Gallant CA 30-Oct-1985
The court reviewed the conflicting authorities with regard to the creation of trusts and held that the overwhelming preponderance of authority was that, in the absence of any claim for rectification or rescission, provisions in a conveyance . .
Lists of cited by and citing cases may be incomplete.
Family, Trusts
Updated: 27 November 2022; Ref: scu.251493
