Evidence Needed to Share Benefical Inerests
The family home had been purchased during the marriage in the name of the husband only. The wife asserted that she had a beneficial interest in it.
Held: The principles apply to any case where a beneficial interest in land is claimed by a person, whether spouse or stranger, in whom the land is not vested. A common intention has to be inferred from the parties’ conduct as to how the beneficial interest is to be held. The relevant intention is that which a reasonable person would draw from the parties’ words or conduct. The court must determine what inferences can reasonably be drawn in each case.
Viscount Dilhorne said: ‘It may be that it is alleged that some time after the acquisition of the matrimonial home the spouses formed the intention of sharing the beneficial interest. It may well be difficult to establish this but if it was, for instance, proved that up to the time when such an intention is alleged to have been formed, the mortgage payments were made by one spouse and thereafter by the other, then proof of that would tend to support the allegation.’
Lord Diplock said that where the most likely inference from the parties’ conduct is that the beneficial interest was not to belong solely to the party in whom the legal title is vested, the court must determine what in all the circumstances is a fair share: ‘A resulting, implied or constructive trust – and it is unnecessary for present purposes to distinguish between these three classes of trust – is created by a transaction between the trustee and the cestui que trust in connection with the acquisition by the trustee of a legal estate in land, whenever the trustee has so conducted himself that it would be inequitable to allow him to deny to the cestui que trust a beneficial interest in the land acquired. And he will be held so to have conducted himself if by his words or conduct he has induced the cestui que trust to act to his own detriment in the reasonable belief that by so acting he was acquiring a beneficial interest in the land.’
As to the shares upon which the property was held: ‘In such a case [where the court is satisfied that it was the common intention of both spouses that the contributing wife should have a share in the beneficial interest and that her contributions were made upon this understanding] the court must first do its best to discover from the conduct of the spouses whether any inference can reasonably be drawn as to the probable common understanding about the amount of the share of the contributing spouse upon which each must have acted in doing what each did, even though that understanding was never expressly stated by one spouse to the other or even consciously formulated in words by either of them independently. It is only if no such inference can be drawn that the court is driven to apply as a rule of law, and not as an inference of fact, the maxim ‘equality is equity’, and to hold that the beneficial interest belongs to the spouses in equal shares.
The same result however may often be reached as an inference of fact. The instalments of a mortgage to a building society are generally repayable over a period of many years. During that period, as both must be aware, the ability of each spouse to contribute to the instalments out of their separate earnings is likely to alter, particularly in the case of the wife if any children are born of the marriage. If the contribution of the wife in an early part of the period of repayment is substantial but is not an identifiable and uniform proportion of each instalment, because her contributions are indirect or, if direct, are made irregularly, it may well be a reasonable inference that their common intention at the time of the acquisition of the matrimonial home was that the beneficial interest should be held by them in equal shares and that each should contribute to the cost of its acquisition whatever amounts each could afford in the varying exigencies of family life to be expected during the period of repayment. In the social conditions of today this would be a natural enough common intention of a young couple who were both earning when the house was acquired but who contemplated having children whose birth and rearing in their infancy would necessarily affect the future earning capacity of the wife.’
Lord Diplock, Viscount Dolhorne, Lord Reid, Lord Morris, Lord Pearson
[1970] 3 WLR 255, [1971] AC 886, [1970] 2 All ER 780, [1970] UKHL 3
Bailii
England and Wales
Cited by:
Cited – Roy Green v Vivia Green PC 20-May-2003
PC (Jamaica) The claimant sought a declaration that he was entitled to one half of the marriage assets on divorce. They had each acquired various properties and assets both in Jamaica and the USA. The judge at . .
Cited – B and Others Russell McVeagh McKenzie Bartleet and Co v Auckland District Law Society, Gary J Judd PC 19-May-2003
(New Zealand) Solicitors resisted requests to disclose papers in breach of legal professional privilege from their professional body investigating allegations of professional misconduct against them.
Held: The appeal was allowed. The . .
Considered – Springett v Defoe CA 1992
Partners lived together, without being married, as secure joint tenants. They exercised the right to buy, contributing three quarters and one quarter of the price respectively. At the time they intended to marry. They did not discuss he shares, and . .
Cited – Foskett v McKeown and Others CA 27-Jun-1997
Various people had paid money with the promise of acquiring an interest in land in Portugal. The scheme was fraudulent. The funds had been used to purchase a life/investment policy. The policy was held in trust for the fraudster’s mother but he had . .
Cited – Lloyds Bank plc v Rosset HL 29-Mar-1990
The house had been bought during the marriage but in the husband’s sole name. The plaintiff’s charge secured the husband’s overdraft. The bank issued possession proceedings. Mr Rosset had left, but Mrs Rosset claimed, as against the bank an interest . .
Cited – Yaxley v Gotts and Another CA 24-Jun-1999
Oral Agreement Creating Proprietory Estoppel
The defendant offered to give to the Plaintiff, a builder, the ground floor of a property in return for converting the house, and then managing it. They were friends, and the oral offer was accepted. The property was then actually bought in the name . .
Applied – Stokes v Anderson CA 1991
The claimant had made two payments, amounting together to andpound;12,000, towards the acquisition of the one half share of the defendant’s ex-wife in the net equity (valued at andpound;90,000) in a house in which the claimant and the respondent . .
Cited – Hyett v Stanley and others CA 20-Jun-2003
The couple had lived together at the property without being married for several years. The house was held in the man’s sole name, and after his death she sought a half share in it. It was established that she had been told she should have a half . .
Applied – Burns v Burns CA 1984
Long Relationship Not Enough for Interest in Home
The parties lived together for 17 years but were not married. The woman took the man’s name, but beyond taking on usual household duties, she made no direct financial contribution to the house. She brought up their two children over 17 years. . .
Cited – Walker v Hall CA 1984
The court considered the way of distributing property purchased by an unmarried couple: ‘When such a relationship comes to an end, just as with many divorced couples, there are likely to be disputes about the distribution of shared property. How are . .
Cited – Turton v Turton CA 1988
When ascertaining the beneficial interests in a family home purchased by an unmarried couple, those interests had to be ascertained from consideration of the intentions of the parties at the time of the purchase; they were not to be left for . .
Cited – Grant v Edwards and Edwards CA 24-Mar-1986
A couple were not married but lived together in Vincent Farmhouse in which the plaintiff claimed a beneficial interest on separation. The female partner was told by the male partner that the only reason for not acquiring the property in joint names . .
Cited – McFarlane v McFarlane CANI 1972
The parties disputed their respective shares in the family home. The facts in Pettitt and Gissing ‘were not such as to facilitate or encourage a comprehensive statement of this vexed branch of the law’ and ‘much remains unsettled.’ The court . .
Cited – Springette v Defoe CA 1-Mar-1992
Property was purchased in joint names, but with no express declaration of the beneficial interests. The couple had lived together for a short time as joint tenants of the local authority. They were able to purchase at a substantial discount from the . .
Cited – Cobbe v Yeomans Row Management Ltd and Others ChD 25-Feb-2005
Principles for Proprietary Estoppel
A developer claimed to have agreed that upon obtaining necessary planning permissions for land belonging to the respondents, he would purchase the land at a price reflecting its new value. The defendant denied that any legally enforceable agreement . .
Cited – Van Laethem v Brooker and Another ChD 12-Jul-2005
The claimant asserted an interest in several properties by virtue of a common intention constructive trust or by proprietary estoppel. The parties had been engaged to be married.
Held: ‘A [constructive] trust arises in connection with the . .
Cited – Collier v Collier CA 30-Jul-2002
Fraudulent Intent Negated Trust
The daughter claimant sought possession of business premises from her father who held them under leases. He claimed an order that the property was held in trust for him. The judge that at the time the properties were conveyed, the father had been . .
Cited – Clarke v Harlowe ChD 12-Aug-2005
The parties lived together. They acquired between them several properties of which the last was declared to be held as joint tenants. The relationship broke down. The parties now sought a declaration as to the destination of the proceeds of sale, . .
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 . .
Cited – Eves v Eves CA 28-Apr-1975
The couple were unmarried. The female partner had been led by the male partner to believe, when they set up home together, that the property would belong to them jointly. He had had told her that the only reason why the property was to be acquired . .
Cited – James v Thomas CA 23-Nov-2007
The claimant sought an interest in the property registered in the sole name of the respondent. The respondent had inherited a share in the property, and then bought out the interests of his siblings with support of a loan. The claimant had made no . .
Cited – Fowler v Barron CA 23-Apr-2008
The parties had lived together for many years but without marrying. The house had been put in joint names, but without specific advice on the issue or any express declaration of trust. In practice Mr Barron made the direct payments for the house and . .
Cited – Kilcarne Holdings Ltd v Targetfollow (Birmingham) Ltd and Another CA 16-Nov-2005
The defendant had brought in the claimant in order to assist in satisfying its own obligations under a lease. The joint venture was not recorded in a formal agreement. The appellant asserted that a constructive trust had been created. The judge had . .
Cited – Parris v Williams CA 23-Oct-2008
The parties had been business partners, but the business failed, and Mr Williams was made bankrupt. Mr Parris was offered a chance to purchase two apartments, and did so in his own name. Mr Williams asserted an interest, saying that it had been a . .
Cited – Thorner v Major and others HL 25-Mar-2009
The deceased had made a will including a gift to the claimant, but had then revoked the will. The claimant asserted that an estoppel had been created in his favour over a farm, and that the defendant administrators of the promisor’s estate held it . .
Cited – Cooper and Others v Fanmailuk.Com Ltd and Another CA 17-Dec-2009
F claimed to be the beneficial owner of shares registered in the names of the claimants. The appellants challenged a finding that the shares were held on trust for F, and the implication that the first appellant had presented a dishonest claim.
Cited – Clarke and Another v Corless and Another CA 31-Mar-2010
The claimants appealed against refusal of a declaration that a neighbouring access road and land was held on a constructive trust. They said that an agreement bewteeen the parties should have been effective to impose a trust on the defendants. The . .
Cited – Jones v Kernott SC 9-Nov-2011
Unmarried Couple – Equal division displaced
The parties were unmarried but had lived together. They now disputed the shares in which they had held the family home. It had been bought in joint names, but after Mr Kernott (K) left in 1993, Ms Jones (J) had made all payments on the house. She . .
Cited – Singh v Singh and Another ChD 8-Apr-2014
The parties disputed ownership of various valuable properties. The father asserted that they were held under trusts following the Mitakshara Hindu code, under a common intention constructive trust. The son said that properties held in his own name . .
Cited – Lloyds Bank plc v Rosset CA 13-May-1988
Claim by a wife that she has a beneficial interest in a house registered in the sole name of her husband and that her interest has priority over the rights of a bank under a legal charge executed without her knowledge. The case raises a point of . .
Cited – Sen v Headley CA 28-Feb-1991
D, who was in hospital and near death, said to R (his former partner): ‘The house is yours, Margaret. You have the keys. They are in your bag. The deeds are in the steel box.’ After D’s death R discovered that D had put had put into her bag the only . .
Lists of cited by and citing cases may be incomplete.
Family, Trusts, Estoppel
Leading Case
Updated: 25 November 2021; Ref: scu.182237