Экзамен зачет учебный год 2023 / Sparkes, A New Land Law

basis to explain why equity requires that recognition be given to the interest of a contributor.29

1.Classification of informal trusts

[17.08] Gissing trusts now fall into two categories, even if this technical analysis is often blurred.30 Trusts based on contribution (those considered here and apparently most common31) give a claimant what he has paid for, whereas intention-based trusts32 give the claimant what has been promised, often more than has been paid for.

Terminology is important and a potent source of confusion,33 because there are two categories for three types of trust, and judges are more concerned to establish a valid claim than to describe it accurately.34 Some commentators describe all trusts based on contribution as resulting trusts,35 so that classification follows from the method of quantification. Orthodox terminology focuses rather on the means of creation, treating a resulting trust as one arising from a cash payment towards acquisition and a constructive trust arising from a common intention.36 All agree that a trust based on an expressed common intention is constructive, the claimant receiving what he has been promised. This book adopts a threefold classification: (1) resulting, (2) contributionbased constructive, and (3) intention-based constructive.37 A less certain addition, (4), is the holistic trust.

2.Technique for constructive trusts based on contribution

[17.09] Contribution is evidence of a common intention to give a share and is also the evidence used to quantify the share.38 Unless it is expressly agreed in advance that particular contributions are to give a particular share,39 the court must infer an arrangement from the contributions and other conduct, the judicial function being to unravel an arrangement that was actually made at the time but not articulated.40 The court may not impute an arrangement, it may not impose a solution which it would

29A Bottomley “Women and Trust(s): Portraying the Family in the Gallery of Law” ch 8 in Bright & Dewar; Grays’ Elements (3rd ed), ch 7; J Dewar “Land, Law, and the Family Home” ch 13 in Bright & Dewar; JW Harris “Justice, Informality and Home-sharing” ch 5 in Jackson and Wilde; N Hopkins Informal Acquisition 87–125; Megarry & Wade (6th ed), [10.017–10.033]; Smith’s Property Law (4th ed), 129–164; Thompson’s Modern LL (Oxford, 2001), ch 9; MP Thompson “Reform of the Law relating to Property Rights on the Breakdown of Cohabitation” ch 6 in Jackson and Wilde.

30New categories are possible: James v. Williams [2000] Ch 1, CA.

31Lloyds Bank v. Rosset [1991] 1 AC 107, 132H, Lord Bridge.

32See below [17.22].

33Drake v. Whipp [1996] 1 FLR 826, 827C, Peter Gibson LJ.

34DJ Hayton, Law of Trusts (Sweet & Maxwell, 1989), 145.

35Allen v. Snyder [1977] 2 NSWLR 685, 692A Glass JA; Hanbury & Martin Modern Equity (16th ed, Sweet & Maxwell, 2001), 264–271; DJ Hayton as above, 144.

36This is usual terminology: Rosset [1991] 1 AC 107, Lord Bridge, Gissing [1971] AC 886, Lord Diplock; Cowcher v. Cowcher [1972] 1 WLR 425, 431, Bagnall J; Megarry & Wade, (6th ed), [10.028].

37P Sparkes (1991) 11 OJLS 39.

38Grant v. Edwards [1986] Ch 638, 646H–647B, Nourse LJ, 655B, Browne-Wilkinson V-C. Contribution gives a share as under a right rather than a life interest: Ivin v. Blake [1995] 1 FLR 70, CA.

39Gissing v. Gissing [1971] AC 886, 905D, 906A.

40Lloyds Bank v. Rosset [1991] 1 AC 107, 132H, Lord Bridge; M Dixon [1991] CLJ 38; JD Davies (1990) 106 LQR 539; S Gardner (1991) 54 MLR 126; MP Thompson [1990] Conv 314.

have been reasonable for the couple to adopt if they had applied their minds to the matter.41

Special justification is required to enforce a trust lacking a written memorandum,42 the basis being that is unconscionable to deny a promised beneficial interest after the claimant has incurred, in general terms, a detriment,43 or more specifically after he has made a substantial contribution. Payment is easily proved and protects creditors from excessive claims.44

3.Patterns of contribution

[17.10] Beneficial interests should usually be fixed, once and for all, on acquisition,45 though evidence of the intention at that time can be gathered from everything done up to the time that the couple separate.46 If a couple arrange to buy a house equally, the shares are unaffected by the fact that one party is afterwards unable to make payments, while out of work or while caring for a child.47 But the need for a common intention can also be used to deny interests. In Pettitt v. Pettitt48 work done to improve a matrimonial home did not operate to create a constructive trust, because there was no intention to create such a trust at the time of acquisition. Payments of mortgage interest in another case between 1966 and 1968 showed nothing about the state of the mind of the parties when a house was bought in 1962.49

Decisive breaks in the pattern should raise an inference that the arrangement had been altered, adapting the beneficial interests to changes in the course of a relationship,50 reflecting events.51 A breach should occur where a cohabitant moves in and starts making mortgage repayments after the initial purchase by the other cohabitee, or where the couple agree to fund a major extension.52 Beneficial interests fixed by an express trust require formal variation by written disposition.53

The need for a shared intention at the moment of acquisition can be overcome by a contribution variable constructive trust.54 In Gissing Lord Diplock thought it not unlikely that parties would agreed to such beneficial interests as could be seen in

41Rosset at 132H, Lord Bridge; but see below at [17.26], [17.31].

42LPA 1925 s 53(2).

43Gissing v. Gissing [1971] AC 886, 905B, Lord Diplock; Burns v. Burns [1984] Ch 317, 326, Fox LJ; Grant v. Edwards [1986] Ch 638, 654D, Browne-Wilkinson V-C.

44Re Gorman [1990] 1 WLR 616, Div Ct; Re Pavlou [1993] 1 WLR 1046, Millett J.

45Lloyds Bank v. Rosset [1991] 1 AC 107, 132F, Lord Bridge; Burns v. Burns [1984] Ch 317, 327, Fox LJ; Bernard v. Josephs [1982] Ch 391, 404E–F, Griffiths LJ.

46Bernard [1982] Ch 391, 399F, 404C–D, 404G; approved Burns [1984] Ch 317, 327A.

47Bernard at 404A, Griffiths LJ.

48[1970] AC 777, HL.

49Cowcher v. Cowcher [1972] 1 WLR 425, 441A.

50Gissing v. Gissing [1971] AC 886, 906A, Lord Diplock; Grant v. Edwards [1986] Ch 638, 651h, Mustill LJ; Lloyds Bank v. Rosset [1991] 1 AC 107, 132F, Lord Bridge.

51Austin v. Keele (1987) 72 ALR 651–652, Lord Oliver; JD Davies (1990) 106 LQR 539.

52Bernard v. Josephs [1982] Ch 391, 404, Griffiths LJ; Mollo v. Mollo [2000] WTLR 227, Ch D.

53LPA 1925 s 53(1)(c); Cowcher v. Cowcher [1972] 1 WLR 425, 432E, Bagnall J; Ivin v. Blake [1995] 1 FLR 70, 87E, Glidewell LJ.

54Apparently this is sufficiently certain: Cowcher v. Cowcher [1972] 1 WLR 425, 430D, Bagnall J; Richards v. Dove [1974] 1 All ER 888, 894d, Walton J; Jeffries v. Stevens [1982] STC 639, 651, Walton J; Walker v. Hall [1984] FLR 126, 136, Lawton LJ. See equity texts for a general discussion of certainty. See also the holistic trust, below at [17.31].

retrospect to be fair,55 and this provides a convenient intellectual device to cope with spasmodic mortgage repayments or where an express agreement promises an unquantified share.56 Equity weighs all cash inputs, later mortgage repayments, and indirect contributions to the family budget which enable the mortgage to be paid, as well as major improvements.57

4.Contributions referable to acquisition

[17.11] A common intention about the ownership of a house can only be inferred from contributions which are strictly referable to its acquisition. When Lord Bridge said in Rosset58 that “it is extremely doubtful whether anything less will do”, he accepted the restrictive decision in Winkworth v. Edward Baron Developments Co,59 that a payment by a director to a company which had already bought, the payment being made after completion of the company’s purchase, was not a contribution to the acquisition of title. Simon Gardner has argued that removal of the referability filter would improve the law without excessive technical dislocation.60

No beneficial interest arises from payments of rent, partially because a capital contribution is required,61 but mainly because rent pays for the use and occupation of the land:62 in Passee v. Passee63 two women contributors each paid £2.50 a week towards the mortgage and secured a beneficial interest, whereas the owner’s son who paid £3 weekly as rent and so secured no beneficial interest.64 Indeed the court can take into account the value of occupation received as a deduction from monetary contributions.65

Contributions must be substantial. Pettitt v. Pettitt66 concerned a matrimonial home vested in the wife’s name in which her husband claimed a share based on work in redecoration and improvement which, although costing £1,000, enhanced the value by only £300. This was too insubstantial. So too was Mrs Rosset’s investment of time in supervising the builders who were renovating a farmhouse to make it fit for her family. Express arrangements can be supported by relatively small acts of detriment.67

55[1971] AC 886, 909D–E.

56Stokes v. Anderson [1991] 1 FLR 391, 399, Nourse LJ; Passee v. Passee [1988] 1 FLR 263, CA.

57Midland Bank v. Cooke [1995] 4 All ER 562, 574d–e, Waite LJ; P Wylie (1995) 25 Fam Law 633; S Gardner (1996) 112 LQR 378.

58[1991] 1 AC 107, 133; Gissing [1971] AC 886, 909G, Lord Diplock.

59[1986] 1 WLR 1512, 1516, Lord Templeman; J Warburton [1987] Conv 217; Kowalczuk v. Kowalczuk [1973] 2 All ER 1042, CA Contrast the successful piercing of the corporate veil in Re Schuppan (No 2) [1997] 1 BCLC 256. Also Winsper v. Perrett [2002] WTLR 927, Ch D (reimbursement of part of price was a contribution).

60S Gardner (1993) 109 LQR 263; S Wong (1998) 18 LS 369.

61Savage v. Dunningham [1974] Ch 181; FR Crane (1973) 37 Conv (NS) 440; but see Malayan Joint Credit v. Jack Chia [1986] AC 549, 560G–H, Lord Brightman.

62Annen v. Rattee [1985] 1 EGLR 136, CA.

63[1988] 1 FLR 263, 266G–267B, CA; J Warburton [1988] Conv 361.

64Cracknell v. Cracknell [1971] P 356, CA; Davis v. Vale [1971] 1 WLR 1022, 1028C; Hazell v. Hazell [1972] 1 WLR 301, 303B; Bernard v. Josephs [1982] Ch 391, 410C, Kerr LJ; Ivin v. Blake [1995] 1 FLR 70, CA.

65Thomas v. Fuller-Brown [1988] 1 FLR 237, CA.

66[1970] AC 777 HL; J Tiley [1969] CLJ 191; G Jones [1969] CLJ 196; PV Baker (1969) 85 LQR 330.

67Lloyds Bank v. Rosset [1991] 1 AC 107, 133F–H, Lord Bridge.

5.Direct and indirect contributions

[17.12] Cash injections used68 to buy a house give a corresponding share,69 for example money derived from the sale of a previous house,70 or savings put towards a deposit.71 A council tenant has the right to buy his property at a discount calculated according to the length of time that it has been his home, and this should normally be seen as a cash contribution by the qualifying tenant,72 or at least as evidence of a common intention that he should benefit from it.73 In applying these rules the ownership of the money which is used may well become the vital question.74

Indirect contributions are filtered through an inferred intention which allows a more flexible approach to the kinds of contributions which register. Equity is able to find a cash equivalent to indirect contributions,75 that is any “material sacrifice by way of contribution to or economy in the general family expenditure”,76 such as payments by a wife of household expenses in order to free the husband to pay the mortgage.77 Contributions from a business built up by joint efforts are themselves joint.78 An express agreement may be needed if anything indirect is to be counted.79 Certainly effort expended in building up the couple’s relationship is too indirect to give any interest in the family home.

6.Mortgage repayments

[17.13] Mortgage payments technically repay a debt, but constructive trust theory is based on the economic reality80 that a mortgage is used to buy a house. Any regular pattern of mortgage repayments will readily justify the inference necessary for the

68Money advanced for a purchase but not used will be held on resulting trust: Briggs v. Rowan [1991] EGCS 6.

69Gissing v. Gissing [1971] AC 886, 905D; Lloyds Bank v. Rosset [1991] 1 AC 107, 133.

70Williams & Glyn’s Bank v. Boland [1981] AC 487 HL; Abbey National BS v. Cann [1991] 1 AC 56 HL;

Tinsley v. Milligan [1994] 1 AC 340, HL.

71Halifax BS v. Brown [1996] 1 FLR 103, CA (half a deposit of £150 against a loan of £330,000).

72Springette v. Defoe [1992] 2 FLR 388, CA; HE Norman [1992] Conv 347; Savill v. Goodall [1993] 1 FLR 388, CA (left open); Evans v. Hayward [1995] 2 FLR 511, CA. The presumption that the discount is to be treated as a contribution to the price may be rebutted by establishing that the transaction was a sham to protect a bankrupt against his creditors: Ashe v. Mumford (2000) 33 HLR 67, CA.

73Marsh v. Von Sternberg [1986] 1 FLR 526, Bush J; JE Adams [1989] Conv 155; Evans v. Hayward [1995] 2 FLR 511, 516D–516C, Dillon LJ.

74Married Women’s Property Act 1964 s 1 (housekeeping); MC Cullity (1969) 85 LQR 530 (joint bank accounts).

75Gissing v. Gissing [1971] AC 886, 896, Lord Reid, 903, Lord Pearson.

76Gissing at 905D, Lord Diplock.

77Hargrave v. Newton [1971] 1 WLR 1611, 1613 (reward for finding Great Train Robbery money); Cooke v. Head [1972] 1 WLR 518, CA (income pooled in joint kitty); Hazell v. Hazell [1972] 1 WLR 301, CA; J Eekelaar (1972) 88 LQR 333; Burns v. Burns [1984] Ch 317, 328, Fox LJ.

78Nixon v. Nixon [1969] 1 WLR 1676, CA; Windeler v. Whitehall [1990] 2 FLR 505; Chan Pui Chun v.

Leung Kam Ho [2002] BPIR 7233, Ch D.

79Rosset [1991] 1 AC 107, 133A, Lord Bridge; R v. Robson (1991) 92 Crim App R 1, CA; Howard v. Jones (1989) 19 Fam Law 231, CA; Ivin v. Blake (1994) 67 P & CR 263, CA.

80Diwell v. Farnes [1959] 1 WLR 624, CA; Gissing v. Gissing [1971] AC 886, 906F; Bernard v. Josephs

[1982] Ch 391, 404D, Griffiths LJ.

creation of a constructive trust,81 though nothing can be inferred from isolated payments.82 Acceptance of liability as a joint borrower will not give any interest if it is done to help a friend obtain mortgage finance and the friend makes all repayments.83 No importance attaches to the form of the mortgage: a repayment mortgage more obviously buys an interest in the house, but so too do monthly payments towards an endowment policy intended to repay the loan.84

Should repayments be assessed on their gross value, including interest, or only on the capital element? In the early years of an instalment mortgage most of what is repaid is interest,85 so it is not fair to balance an interest payment against hard cash used for a deposit,86 though the point is open.87 There is no objection to the aggregation of gross mortgage repayments over a period of time to give a proportionate share of that part of the property which is attributable to the mortgage.88

A large sum used for a substantial one-off reduction in the debt should give a proportionate interest in the property.89

7.Balancing the deposit and the mortgage

[17.14] Resulting trust technique90 is to view the introduction of a mortgage advance as a cash contribution to the purchase price equal to the amount of the loan.91 On the first day, the beneficial interest arising from the mortgage contribution will be zero, as the redemption figure will be debited against the share arising from the mortgage advance. In later years, when the loan has been fully discharged, the mortgage contribution will come to stand at its full proportion as against the deposit, with nothing to debit.92

Constructive trust technique is less satisfactory as a means of balancing a cash deposit and a mortgage advance. Unless beneficial entitlement is equal,93 it is not correct to deduct the mortgage redemption figure from the sale proceeds and then to

81Gissing v. Gissing [1971] AC 886, 905D, 907E, Lord Diplock; Lloyds Bank v. Rosset [1991] 1 AC 107, 133, Lord Bridge; Bernard v. Josephs [1982] Ch 391, 404, Griffiths LJ; Burns v. Burns [1984] Ch 317, 329B, Fox LJ, 344F–345A, May LJ.

82Young v. Young [1984] FLR 375, CA (man had paid only £175).

83Carlton v. Goodman [2002] EWCA Civ 545, [2002] 2 FLR 259.

84Smith v. Clerical Medical & General Life Assurance Society [1993] 1 FLR 47, CA; Cowcher v. Cowcher

[1972] 1 WLR 425, 441G, 441H–442B, Bagnall J; Heseltine v. Heseltine [1971] 1 WLR 342, 345E; Ulrich v. Ulrich [1968] 1 WLR 180, 186E–F, Lord Denning MR.

85Falconer v. Falconer [1970] 1 WLR 1333, CA (debt reduced in 8 years from £2,660 to £2,500); Young

v.Young [1984] FLR 375, CA (£200 over 16 months).

86Rimmer v. Rimmer [1953] 1 QB 63, 74; Cowcher v. Cowcher [1972] 1 WLR 425; J Levin (1972) 35 MLR 547; Diwell v. Farnes [1959] 1 WLR 624, 633; Cracknell v. Cracknell [1971] P 356, 361C–D, Lord Denning MR; Cooke v. Head [1972] 1 WLR 518; Hall v. Hall (1982) 3 FLR 379; Walker v. Hall [1984] FLR 126, 130E.

87Passee v. Passee [1988] 1 FLR 263, 267G–268A, Nicholls LJ; J Warburton [1988] Conv 361.

88Turton v. Turton [1988] Ch 542, 548F, Nourse LJ; J Warburton [1987] Conv 378.

89Burns v. Burns [1984] Ch 317, 328, Fox LJ.

90P Sparkes (1991) 11 OJLS 39.

91If there is an agreement to service it equally then in equal cash contribution: Marsh v. Von Sternberg [1986] 1 FLR 526, 534G, Bush J.

92Huntingford v. Hobbs [1993] 1 FLR 736, CA; also Harwood v. Harwood [1991] 2 FLR 274, CA; McHardy & Sons v. Warren [1994] 2 FLR 338, CA; Halifax BS v. Brown [1996] 1 FLR 103, CA.

93Rimmer v. Rimmer [1953] 1 QB 63, 74; Ulrich v. Ulrich [1968] 1 WLR 180, 186E–F; Bernard v. Josephs [1982] Ch 391, 400F–H.

determine the beneficial shares in the divisible equity.94 The numerical fraction representing each share necessarily varies according to the amount of the mortgage that has been discharged and so a specific date is required for quantification,95 but the correct method remains to be settled.96

8.Improvements

[17.15] There is no direct liability to pay for improvements,97 but an obligation may arise to pay over a proportion of the value of a property when the land is sold, under modern law as under the old law of partition.98 In other words there may be a lien for repayment of the cost of the work.99 Substantial100 works of improvement may also give rise to a beneficial share under a constructive trust. Do not expect a share from putting up a shelf, touching up paint-work, or gardening,101 nor from any other work normally carried out by members of a family on the family home.

Substantial102 improvements to matrimonial property will normally give entitlement to an enhanced beneficial interest103 without any express or inferred agreement under section 37 of the Matrimonial Proceedings and Property Act 1970. This confirms the majority decision in Jansen v. Jansen.104 A husband spent so much time and effort converting a house owned by his wife into self-contained flats, that he had to give up his university course to concentrate on the renovation work. He took a share of the profit his work had created. The section has been applied105 to partial installation of central heating,106 major works of internal renovation,107 repairs and improvements.108 The enhanced beneficial interest is such “as may seem in all the circumstances . . . just”.109

No share is acquired by substantial improvement of non-matrimonial property. In Thomas v. Fuller-Brown110 an unemployed man did work to improve the house owner

94 Cooke v. Head [1972] 1 WLR 518, CA; Falconer v. Falconer [1970] 1 WLR 1333; Cracknell v. Cracknell [1971] P 356, 361C; Hargrave v. Newton [1971] 1 WLR 1611. Query the approach in Midland Bank v. Cooke [1995] 4 All ER 562, CA.

95Passee v. Passee [1988] 1 FLR 263, 272A, CA.

96Equity & Law Home Loans v. Prestidge [1992] 1 WLR 137, 142D–E, Mustill LJ; Marsh v. Von Sternberg [1986] 1 FLR 526, 533D, Bush J; Huntingford v. Hobbs [1993] 1 FLR 736, Steyn LJ dissenting.

97Thomas v. Thomas (1850) 5 Exch 28, 155 ER 13; Re Coulson’s T (1907) 97 LT 754; Leigh v. Dickeson (1884) 15 QBD 60, CA.

98Re Jones [1893] 2 Ch 461; Re Cook’s Mortgage [1896] 1 Ch 923; Kenrick v. Mountsteven (1890) 48 WR 141; Leigh v. Dickeson (1884) 15 QBD 60, CA; Re Pavlou [1993] 1 WLR 1046, Millett J.

99Lake v. Craddock (1733) 3 P Wms 158, 24 ER 1011; Gross v. French [1976] 1 EGLR 129.

100Pettitt [1970] AC 777, HL.

101Button v. Button [1968] 1 WLR 457, CA; Pettitt v. Pettitt [1970] AC 777, HL.

102Pettitt is unaffected: Law Com 25 (1969), [58].

103The claim is proprietary rather than a personal claim in restitution: Firth v. Mallender [2001] WTLR 1109, CA.

104[1965] P 478, CA, Denning MR and Davies LJ; J Tiley [1969] CLJ 81; Pettitt [1970] AC 777, minority view of Lords Reid and Diplock; Law Com 25 (1969), [57], Davis v. Vale [1971] 1 WLR 1022, 1025G–1026D, CA.

105Samuel’s Trustees v. Samuels [1975] 1 EGLR 94, Walton J; Kowalczuk v. Kowalczuk [1973] 2 All ER 1042, CA; Griffiths v. Griffiths [1973] 1 WLR 1454 Arnold J.

106Re Nicholson [1974] 1 WLR 476, Pennycuick V-C (replacement of gas cooker ignored).

107Davis v. Vale [1974] 1 WLR 1021, CA.

108Re Pavlou [1993] 1 WLR 1046, Millett J.

109Matrimonial Proceedings and Property Act 1970 s 37.

110[1988] 1 FLR 237, CA; Rosset [1991] 1 AC 107, HL; Ungurian v. Lesnoff [1990] Ch 206, Vinelott J.

by his female partner in return for his keep, but acquired no interest. An agreement or common intention to give a share is essential, and it must usually be express to permit clear quantification,111 unless it can be inferred from very substantial work112 or expense.113

Interests gained by improvement that fall to be quantified on constructive trust principles will depend upon what common intention can be inferred.114 A financial equivalent has to be discovered,115 a question of some nicety where the improvement obviates the need for repair.116 However, the real problem is to decide between the cost of the improvement work or the increase in value of the house.117 Re Nicholson supports the added value approach.118

D. OTHER EXPLANATIONS FOR CASH INJECTIONS

1.Loan

[17.16] This is distinct from a contribution, since a loan has to be repaid and usually with interest.119 A lender should not be paid twice over, so that a finding that money is lent precludes a finding of trust.120 In real life the distinction blurs, because of inaccurate use of language,121 inaccurate documentation,122 or the drift of human affairs. In Hussey v. Palmer123 an elderly widow was invited to live with her daughter and son- in-law provided she paid for construction of a bedroom extension. After the parties had fallen out, she sued for return of the money, but it was decided that it had not been a loan. In a second action, this time posited on the assumption that the sum was a contribution, the woman inconveniently gave evidence that she had provided the money as a loan! One view was that this precluded a finding of a beneficial interest under a resulting or constructive trust but a majority of the Court of Appeal took pity on a plaintiff who clearly had a valid claim to something and allowed her payment to stand as a contribution. Too much emphasis can be placed on the initial finding of fact.

111Davis v. Vale [1971] 1 WLR 1022, CA.

112Davis v. Vale [1971] 1 WLR 1022, CA; Cooke v. Head [1972] 1 WLR 518, CA; Re Nicholson [1974] 1 WLR 476, 482H, Pennycuick V-C; Eves v. Eves [1975] 1 WLR 1338, CA; Drake v. Whipp [1996] 1 FLR 826, CA. Unsuccessful cases are Rosset [1991] 1 AC 109, HL; Ungurian v. Lesnoff [1990] Ch 206, Vinelott J.

113Hussey v. Palmer [1972] 1 WLR 1286; Bernard v. Josephs [1982] Ch 391, 404E, Griffiths LJ; Burns v. Burns [1984] Ch 317, 327D, Fox LJ; Spence v. Brown (1988) 18 Fam Law 291, CA; Sekhon v. Alissa [1989] 2 FLR 94, Hoffmann J; Briggs v. Rowan [1991] EGCS 6.

114Commonly it is to give whatever interest is fair: Cooke v. Head [1972] 1 WLR 518, CA.

115Passee v. Passee [1988] 1 FLR 263, CA (plaintiff’s share increased from 40% to 60%); J Warburton [1988] Conv 361.

116Lloyds Bank v. Rosset [1991] 1 AC 107, 131C, 131F.

117Re Pavlou [1993] 1 WLR 1046, Millett J.

118[1974] 1 WLR 476, Pennycuick V-C; also Pettitt at first instance.

119Bennet v. Bennet (1879) 10 Ch D 474, CA.

120Re Sharpe [1980] 1 WLR 219, Browne-Wilkinson J; Richards v. Dove [1974] 1 All ER 888; Noble v. Ferdinand [1992] CLYB 564.

121Spence v. Brown (1988) 18 Fam Law 291, CA (not really loan but part of price for living in house).

122Risch v. McFee (1990) 61 P & CR 42, CA (loan agreement drawn by solicitor); Stokes v. Anderson [1991] 1 FLR 391, CA (promissory note).

123[1972] 1 WLR 1286, CA; (1973) 89 LQR 2.

2.Proved gift

[17.17] No capital share arises from money provided as a gift. Oral evidence is allowed to prove a gift, particularly cogent evidence being receipt of income from the land124 and possession,125 though payment of interest favours a finding of loan.126 All acts, contemporaneous and later, are admissible both for127 and against128 the person who made them.

3.Gift (advancement) presumed from family relationship

[17.18] A presumption of advancement (that is of gift) may arise from the family relationship between the person paying the price and the person in whose name title is taken.129 Nineteenth century equity adopted a rigid doctrine based on set relationships, but changes in social organisation in the intervening years have left those rules looking most unjust.130 The strength of the presumption has diminished131 to the extent that four members of the Lords in Gissing thought that it rarely had a role to play, certainly not between a couple sharing a house.132 Paradoxically its vitality has been reasserted in a recent illegality case.133

(1) Parental gifts

[17.19] Transfers of property from father to child are presumed to be as a gift,134 there being a “moral obligation to give”,135 even if the child is wealthy136 or middleaged.137 The presumption was much less clear with an illegitimate child,138 but modern statutes make it irrelevant whether a child’s parents are or are not married, and this should have a knock-on effect in advancement. Mother to child is more problematic. Older cases referred neutrally to parents, but during the nineteenth century the presumption of gift was limited to fathers to correlate with the moral obligation to

124Rider v. Kidder (1805) 10 Ves 360, 32 ER 884; Re Gooch (1890) 62 LT 384. But a reservation of income for life is consistent with a gift of capital.

125Stock v. McAvoy (1872) LR 15 Eq 55, 59, Wickens V-C.

126Bennet v. Bennet (1879) 10 Ch D 474.

127Civil Evidence Act 1968 s 2, now superseded by Civil Evidence Act 1995 s 7 (1).

128Shephard v. Cartwright [1955] AC 431, HL; RE Megarry (1953) 69 LQR 169; Sidmouth v. Sidmouth (1840) 2 Beav 447, 455, 48 ER 1254, Langdale MR; Warren v. Gurney [1944] 2 All ER 472.

129Tinsley v. Milligan [1994] 1 AC 340, 372B, Lord Browne-Wilkinson.

130Pettitt v. Pettitt [1970] AC 777, 824A–D, Lord Diplock.

131At 793E–G, Lord Reid, 811G, Lord Hodson, 824A–D, Lord Diplock.

132[1971] AC 886, 907, Lord Diplock; Falconer v. Falconer [1970] 1 WLR 1333, 1335H–1336A, Lord Denning MR; McGrath v. Wallis [1995] 2 FLR 114, CA.

133Tinsley v. Milligan [1994] 1 AC 340, HL.

134A selection: Grey v. Grey (1677) 1 Ch Cas 296, 22 ER 809; Dyer v. Dyer (1788) 2 Cox 92, 30 ER 42; Sidmouth v. Sidmouth (1840) 2 Beav 447, 48 ER 1254 (Lord Eldon’s brother); Re Engelbach’s E [1924] 2 Ch 348 (daughter); Warren v. Gurney [1944] 2 All ER 472 (rebutted on facts); Shephard v. Cartwright [1955] AC 431, HL; Webb v. Webb [1991] 1 WLR 1410; McGrath v. Wallis [1995] 2 FLR 114, CA.

135Bennet v. Bennet (1879) 10 Ch D 474, 477, Jessel MR.

136Elliot v. Elliot (1677) 2 Ch Cas 231, 22 ER 922.

137Hepworth v. Hepworth (1870) LR 11 Eq 10.

138Beckford v. Beckford (1774) Lofft 490, 98 ER 763; Soar v. Foster (1858) 4 K & J 152, 70 ER 64 (unsatisfactory).

provide capital to a child to set him up in life, a dominant historical tradition139 which survives to this day,140 though the base presumption is of little moment given how easy it is to prove that a mother intends a gift.141 Modern law does not distinguish the maintenance obligations of mother and father and advancement ought to be gender neutral.142

A person adopting the position of parent is said to stand “in loco parentis”, and a presumption of advancement can arise.143 The giver might be a stepfather,144 a widowed mother,145 or a grandfather who has taken over the parental role.146

(2) Spouses and cohabitants

[17.20] Advancement may have been presumed from husband to wife either because of the frequency with which men did make gifts to their wives, or, more probably, because of the former economic dependency of married women.147 It seemed natural to match the common law obligation to provide for a wife with a presumption that transfers to her were meeting this obligation, whether by direct transfer to her name,148 by paying mortgage instalments,149 or by transfers of property to joint names.150 Engaged couples stand on the same footing as spouses,151 so a gift is presumed from a male fiancé to a female fiancée,152 even if the marriage plans subsequently fall through. No gift is presumed by a wife to her husband, so the husband holds the property on resulting trust for his wife, whether he purchases in his wife’s name153 or she makes a voluntary transfer to him.154 The lack of gender neutrality can only be explained historically.

If moral obligation was the basis of advancement, one would expect a strong presumption of advancement by a man to a woman with whom he was living out of marriage, especially given the severity of the social the penalties attaching to a cohabiting woman under Victorian settlements, but in fact no advancement was

139Re De Visme (1863) 2 De GJ & Sm 17, 46 ER 280; Bennet v. Bennet (1879) 10 Ch D 474, CA; Bull v. Bull [1955] 1 QB 234, CA (rebuttal on the evidence). For gift see Batstone v. Salter (1875) LR 10 Ch App 431.

140Sekhon v. Alissa [1989] 2 FLR 94, Hoffmann J; G Kodilinye [1990] Conv 213; Ivin v. Blake (1994) 67 P & CR 263, CA; A Dowling [1996] Conv 274.

141Bennet, at 479, Jessel MR; Dewar v. Dewar [1975] 1 WLR 1532, Goff J.

142Gross v. French [1976] 1 EGLR 129, 132L, Scarman LJ.

143Bennet at 477, Jessel MR.

144Re Paradise Motor Co [1968] 1 WLR 1125, CA (stepson).

145Sayre v. Hughes (1868) LR 5 Eq 376; Batstone v. Salter (1875) LR 10 Ch App 431; Re Orme (1883) 50 LT 51, Kay J.

146Ebrand v. Dancer (1680) 2 Ch Cas 26; 22 ER 829; contrast Re Vinogradoff [1935] WN 68 (surely unreal?).

147Pettitt v. Pettitt [1970] AC 777, 793E–G, Lord Reid.

148Harrods v. Tester [1937] 2 All ER 236, 239C.

149Moate v. Moate [1948] 2 All ER 486; Silver v. Silver [1958] 1 WLR 259; Richards v. Richards [1958] 1 WLR 1116; however a husband paying a mortgage should not be seen as making a gift to his wife.

150Re Eykyn’s Ts (1877) 6 Ch D 115 (spouse and stranger); Re Harrison (1920) 90 LJ Ch 186; Re Figgis [1969] 1 Ch 123.

151Law Reform (MP) Act 1970 s 2(1).

152Moate v. Moate [1948] 2 All ER 486; Mossop v. Mossop [1989] Fam 77, 84F, Sir F Lawton; Shaw v. Fitzgerald [1992] 1 FLR 357.

153Re Dixon [1900] 2 Ch 561, CA; Mercier v. Mercier [1903] 2 Ch 98, CA.

154Heseltine v. Heseltine [1971] 1 WLR 342, CA.

presumed,155 even where there was a high degree of emotional commitment, for example after an invalid attempt to marry.156 Usually today there will be proof of the actual intention.157 Advancement was never presumed between two lesbians. The House of Lords applied the old presumptions in Tinsley v. Milligan,158 though it was a novelty to apply them to a Gissing constructive trust.159 Milligan introduced about £3,500 cash, but her successful counterclaim for an equal share of the beneficial interest could only arise under a constructive trust,160 and the court should have found what common intention existed without any regard to artificial presumptions, but ignoring all evidence of illegality.

4.Rebuttal by proof of contribution

[17.21] Without any presumptions there would be a very wide sea without a chart, but the rules can be displaced by hard evidence, even so as to create a trust.161 Any evidence is now considered by the courts (illegality apart162), so it should be rare to have to decide a case on the presumption alone. Frequently the presumption is vindicated by the actual evidence,163 but it is equally possible that the evidence will contradict the presumption.164 Evidence may show that a different name was used for convenience165 that oral statements negated a gift,166 or that there was an unexecuted trust deed.167 Possession of the land may provide important evidence.

E. INTENTION-BASED CONSTRUCTIVE TRUSTS

1.Common intention

[17.22] Intention-based constructive trusts give the claimant what he has been promised, as a supplement to any interest already bought by contribution. In Re Densham the wife contributed £585 out of a purchase price of £5,650, thus acquiring by contribution a beneficial interest amounting to perhaps 1/9th,168 but

155Rider v. Kidder (1805) 10 Ves 360, 32 ER 884 (cohabitant); Lowson v. Coombes [1998] Ch 373, CA.

156Soar v. Foster (1858) 4 K & J 152, 70 ER 64 (marriage to deceased wife’s sister).

157Avoidance of a transfer for undue influence obviously negates any intention to give: Simpson v. Simpson [1992] 1 FLR 601; B Dale [1989] Conv 63; Re Figgis [1969] 1 Ch 123.

158[1994] 1 AC 340, HL.

159[1992] Ch 310, 340B, Lloyd LJ.

160[1994] 1 AC 340, 371E, Lord Browne-Wilkinson; [1992] Ch 310, 340A–C, Lloyd LJ. Query whether there was a resulting trust on these facts: Law Com CP 157 (1998), [3.63–3.64].

161Ashburner’s Equity (Butterworths, 2nd ed by D Browne, 1953), 110 n 2.

162Tinsley [1994] 1 AC 340 HL; Webb v. Webb [1992] 1 All ER 17 at first instance; A Briggs (1994) 110 LQR 526.

163Dyer v. Dyer (1788) 2 Cox 92, 30 ER 42.

164Hatley v. Liverpool Victoria Legal Friendly Society (1918) 88 LJKB 237 (insurance to cover burial expenses obviously not gift); Jones v. Jones [1977] 1 WLR 438, CA.

165Marshall v. Crutwell (1875) LR 20 Eq 328; Hoddinott v. Hoddinott [1949] 2 KB 406; Re Figgis [1969]

1Ch 123, 144–6; MC Cullity (1969) 85 LQR 530.

166Warren v. Gurney [1944] 2 All ER 472, CA.

167McGrath v. Wallis [1995] 2 FLR 114, CA.

168[1975] 1 WLR 1519, 1531B, Goff J; F Webb (1976) 92 LQR 489.