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Co-ownership

TRUST OF FAMILY HOME ( beneficial ownership)

I.e spousal scenario

Structure

• Definition

• How it arises

• Quantifying the interest

STEP 1

What is co-ownership? Define

- According to Martin Dixion in his Morden Land law chapter 4, ‘the law of co-ownership’
is a set of rules that governs dealings with property that is owned simultaneously by more
than one person.

- General Rule :

- The parties are best advised to regulate their co-ownership by means of a formal express
agreement. This should set out the right and objective of each party in relation to the
land/investment and include an express declaration of trust. It should also meet the
requirement under section 53(1)d LPA 1925. Therefor a purely oral declaration of
coownership will not work. This principle is emphasised in the Pankhania v Chandegra

- unless the written document is fraudulent S v. J

-
• However, there is an important exception to the requirement of writing:
namely, that a person who is not a party to any valid express declaration of
trust may establish a beneficial interest in the property by proving a
resulting or constructive trust or (less commonly) under the law of

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proprietary estoppel

-
- In applying this to the fact indicate that this rule was not adhered to .

STEP 2

- Where No express trust has been declared in accordance with sec.53(1)B LPA 1925
coownership will often arise informally usually under sec. 53(2) LPA 1925 which exempt
implied trust from the formalities of an express trust. Alternatively in Bull v. Bull it is
possible there to be one trustee of the land, but two co-owners in equity. The parties with
equitable interest may explore their chances in using the principles of Resulting
trust,Contracting trust and sometimes proprietary estoppel.

STEP 2(1)

• RESULTING TRUST :

Here the interest must be evidenced in writing as required by section 53(1) of the LPA 1925.
The case of Curley V Parks affirms that before a resulting trust could be implied the
contribution to the purchase of the house must either be before or at the time of the purchase
but does not have their name on the legal title.

- Apply this principle to the facts

- However Jones V Kernott the court upheld that the resulting trust principles are not
suitable for family situations. The point was on the need for a more broader and flexible
approach considering the complex way in which we live and relate in society. This opens
the way for the constructive trust approach

-
STEP 2(2)

• CONSTRUCTIVE TRUST ( direct or indirect contribution )

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- Although there is no financial contribution to the house, in Stack V Dawden common
intention was used to address the legitimate expectations of those who made non-financial
contributions to the home. In Llyods Banks V Rosset Lord Bridge gave two instance
where one can claim beneficial interest using legitimate expectation. These are:

1. Express Common Intention

In O’kelly V Davies express common intention must be one that the court objectively
ascertain as common intention. This is evident in Leefoe V Leefoe where ……. (Refer Sbj
Guide ) .

In the event where this cannot be ascertain . Lord Bridge in Rosset held that

I. common intention could be inferred from indirect financial contribution (eg house Deco,
paying bills etc )

• Family asset approach : midland Bank V Cooke

II. It can also be inferred from the conduct of the parties ( eg house wife, take care of kids )

This has been criticised as being too narrow and subsequently been removed by the supreme
court in Jones V Kenortt and by the House of Lords in the case of Abbot V Abbot .

However Baroness Hale in Stack V Dawden proposed a new approach which is the whole
course of dealing between the parties in relation to the property in ascertaining the parties
“actual intentions or fair”. The court applying the whole cause of dealing in Oxley V
Hiscock took into consideration the children and length of relationship.

Proprietary Estoppel

In the event that the spouse does not benefit from all the issues above. If there was a
particular promise that the woman relied on it. Then under proprietary estoppel they could
claim.
In Southwell v. Blackburn (2014) and Arif v. Anwar (2015), the court decided that
the claimant had not established a common intention sufficient to establish a
constructive trust, but nevertheless that there was a sufficient assurance to establish
an estoppel. This resulted, in Southwell, in the claimant being awarded a monetary
payment rather than an equitable interest in the land, but In Southwell v. Blackburn
(2014) and Arif v. Anwar (2015), the court decided that the claimant had not
established a common intention sufficient to establish a constructive trust, but
nevertheless that there was a sufficient assurance to establish an estoppel. This

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resulted, in Southwell, in the claimant being awarded a monetary payment rather
than an equitable interest in the land, but

2. Detrimental reliance on the common intention

- Following in the case of Eves V Eves reliance does not have to be a financial reliance.
Relying on someones promise heeding to it because it will be unconscionable (unfair) to
renege on their promise
In Greasley v. Cooke (1980), Lord Denning suggests that, if there is evidence of
‘detriment’, there should be a presumption of reliance

-
When the woman is being asked to pack out of the house and the Man is
threatening to sell the house? (Either under beneficial ownership or severance).
Use TLATA

Refer to

I. Section 12 TLATA give the right of occupation to beneficiary who entitled to an

interest in possession in the land

II. Section 14 TLATA (TRUST OF LANDS AND APPOINTMENT OF TRUSTEES ACT )

allows an application to be done to the court and the court in ordering the sale of the
property will take into consideration the factors under section 15 TLATA which includes

• Purpose

• Intention for acquiring the property

• The interest of a minor

• The interest of a secured creditor: In that case, an application is made under section 14 of
TOLATA, but section 335A of the Insolvency Act 1986 provides the list of relevant factors
that the court must consider.86 Note also that, under the Enterprise Act 2002, a trustee in
bankruptcy should apply for sale of the property within three years of the bankruptcy, else
he risks the property returning to the bankrupt free from the claims of the creditors.

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• section 15 is designed to ensure that a court does not simply order sale of the property as a
quick route to a solution, but instead requires it to consider the matter in its complete
context. Thus, under sections 14 and 15, it is perfectly possible for an application for an
order for sale to be refused,68 or for sale to be postponed until some date in the future

Trust of Family Home

Area of Law
Issues
Definition
General rule – EXPRESS CREATION
Resulting trust ( Curley v Parks )
Consider
Constructive trust
Express common intention
Infer from conduct
New Approach: Whole cause of dealing
Proprietary estoppel
Detrimental reliance

QUANTIFYING THE INTEREST

• First determine whether or not this established beneficial interest is being held as Joint tenant or
as tenant in common

First establish the four unities

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PITT

If PITT is established then it means they are governed by the principle of survivorship
( whoever dies first the property is going to the living coowners ) will apply

To avoid the principle of survivorship they will have to server

Server if the question demands it

3. Statutory Severance

4. Common Law Severance

COOWNERSHIP - SEVERANCE (Friends)

Area of Law :

Issue : whether or not the attempt by the parties to sever will hold.
Under section 34( 2) LPA 1925 where land is conveyed to co-owners who are of full age,
they must be joint tenant and cannot be more than 4. By virtues of section 34 (2) LPA 1925
the first 4 named in the conveyance (state names ) hold as legal joint tenants on trust for
themselves and the 5th person as a beneficial joint tenant.

• In the event that they did not make the same contribution Not withstanding their unequal
contribution they will have equal interest under joint tenancy

Apply the facts in the case to severance notes !!

For joint tenants they are govern by the rule of survivorship

Apply facts

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Establish the four unities

According to Lord Oliver in AG Securities V Morgan for the benefits

interest to be held as being joint tenants there must be the 4unities ( PITT).

Apply Fact

In consequence as these requirements (PITT)has been established it could be concluded that

the beneficial interest is being held in joint tenancy. Holding a Joint Tenancy means their
rights are indivisible unless they through the process of severance or survivorship will apply
so that on the death of the first beneficially it will automatically pass through the survivor.

Severance is the process by which a Joint Tenancy in equity can be converted into a tenancy
in common to avoid the operation of a survivorship

A explained in Williams v. Hensman one is statutory and the other is common law

Types of Severance

5. Statutory Severance

Apply facts at every stage

Following sec. 36 ( 2) LPA 1925 a joint tenancy in equity can be severed in writing or by
such other means. In Harris V Goddard IT WAS HELD THAT WRITTEN notice to sever
must be unequivocal and immediate in its effect.

Determining whether or not a written notice is valid we will have to compare Harris V
Goddard and Re Draper’s ( read to be able to contrast )
In Re Draper’s a summons claiming sale of the co-owned property was held to
constitute written notice of severance under section 36(2) and in Quigley v.
Masterson (2011) an application to the Court of Protection also qualified

Also following section 196 LPA 1925 if the writing displays the necessary intention it must
be served properly on the other Joint Tennant . This requires it to be sent to their last town
place of abode or business. According Neuberger J in Kinch V Bullard it is not necessary that

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the notice is actually read by the joint Tenant as it is deemed to be served the moment it
arrives. Neuberger J added that the subsequent distraction of the notice to prevent the other
joint tenant from reading it did not present the severance from taking place.

6. Common Law Severance

In Williams V Hensman Pagewood VC identified three common law forms of severance in

equity.

7. Acting on ones own share I.e Total alienation ( transfer of ones shares (just by making
the others aware) ), Partial Alienation ( mortgaging ones beneficial interest marked area
to make shares known and after it is marked it cannot be unmarked)) and Involuntary
Alienation ( where one of the co-owners is declared bankrupt)

8. Mutual Agreement between all Joint Tenants : the case of Burgess V Rawnsley Denning
said that a common intention had been formed through the parties ‘course of dealings’
which in turn severed the joint tenancy”, Nielson Jones V Fedden , Hunter V Babbage

9. Mutual Course of Dealing : Gore and Snail V Carpenter

10. Unlawful Killing: Re K ,The rule is clearly based on public policy and applies equally to
manslaughter – Chadwick v. Collinson

11.

given that nearly all dispositions of an interest in land must be in writing (section 2
of the LP(MP)A 1989), the ‘act of severance’ by way of mortgage, sale or lease (if
over three years) must be in writing and otherwise enforceable if it is to sever.

2012 PAST QUESTION

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