Mrs Carrick was a widow who orally agreed with her brother in law, a builder, to sell her house and pay him the proceeds, for which he would provide her with a new house. She did so and moved into the new house, which remained in the brother-in-law’s name; later he mortgaged it to the bank. Mrs Carrick’s rights were postponed to the bank because they had not been registered as an estate contract.
Held: A beneficial owner under a bare trust had no defence against a mortagee in possession. ‘In this case there was a trust of the maisonette for the benefit of Mrs Carrick precisely because there had been an agreement between her and Mr Carrick which, for her part, she had substantially if not wholly performed. As between her and Mr Carrick such trust subsisted at all times after November 1982. I agree with counsel for the bank that there is no room in those circumstances for the implication or imposition of any further trust of the maisonette for the benefit of Mrs Carrick. In Lloyds Bank plc v Rosset there was no contract which conferred any interest in the house on the wife. As with all statements of principle the speech of Lord Bridge of Harwich must be read by reference to the facts of the case. So read there is nothing in it to suggest that where there is a specifically enforceable contract the court is entitled to superimpose a further constructive trust on the vendor in favour of the purchaser over that which already exists in consequence of the contractual relationship.
It is true that on this footing the ultimate position of Mrs Carrick with the benefit of a specifically enforceable contract may be worse than it would have been if there had been no contract. But that is because she failed to do that which Parliament has ordained must be done if her interest is to prevail over that of the bank, namely to register the estate contract. Her failure in that respect cannot, in my view, justify the implication or imposition of a trust after the execution of the charge when the dealings between Mr Carrick and Mrs Carrick before such execution did not.’
Judges:
Morritt LJ, Beldam LJ and Sir Ralph Gibson
Citations:
Gazette 17-Apr-1996, [1996] 4 All ER 630
Statutes:
Jurisdiction:
England and Wales
Cited by:
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 . .
Cited – Kilcarne Holdings Ltd v Targetfollow (Birmingham) Ltd, Targetfollow Group Ltd ChD 9-Nov-2004
The defendant entered into an agreement for lease, incurring substantial obligations. When it could not meet them it sought assistance from the claimant, who now claimed to have an interest in a joint venture. The draft documentation originally . .
Lists of cited by and citing cases may be incomplete.
Land
Updated: 15 May 2022; Ref: scu.83108
