5. Trusts of the Family Home Flashcards
(37 cards)
When may disputes as to ownership of the family home arise?
- When the relationship breaks down
- When one spouse dies and their estate is being administered
What factor does Stack v Dowden cite as key to the court’s deliberations over ownership of family homes?
Context.
The context of the domestic setting means family homes are dealt with very differently to disputes over ownership of commercial property.
In what 4 ways can a property be owned?
Sole Legal ownership: At law, the owner of the property is whoever holds legal title to it. For registered land this means the person registered as legal owner at the Land Registry.
Joint legal owners: If the property is registered in joint names the couple will own the property as legal joint tenants.
Equitable joint tenants: The couple own equitable interest in the property together as joint tenants.
Equitable tenants in common: The couple own the equitable interest in the property as joint tenants with individual and divisible shares.
In what ways may legal title to land be held?
Sole legal owner
Joint tenants
How can legal owner(s) hold the title?
- As full legal and beneficial owner. (i.e. there is no separate equitable title)
- On trust for a sole beneficiary
- On trust for more than one beneficiary as joint tenants
- On trust for more than one beneficiary as tenants in common in equal shares
- On trust for more than one beneficiary as tenants in common in unequal shares
What should a solicitor advise legal joint owners of land to do, ideally?
Ideally, the legal owners of land will declare an express trust over it, putting the question of beneficial ownership beyond doubt.
The Land Registry TR1 form (which is needed to transfer legal title to land) includes provision for specifying equitable ownership (but it is not compulsory)
What is the starting presumption for trusts of family homes?
Beneficial ownership of land mirrors legal ownership.
I.e.
* Legal joint owners will hold the land on trust for themselves as equitable joint tenants.
* Legal sole owners are presumed to be sole beneficial owners.
What is the significance of the purchase money resulting trust analysis in these scenarios?
Since Stack v Dowden, this analysis is irrelevant in the family home scenario.
What is the benefit of the common intention constructive trust analysis of family homes?
It is more flexible, allows for a holistic approach and consideration of all circumstances of the case, beyond simply monetary contributions.
What are common intention constructive trusts?
Mechanism for determining beneficial ownership, reflecting common intention of the parties
The Common intention can either be express (based on express statements) or inferred (determinded objectively based on the circumstances)
What must be proven for a common intention constructive trust to arise in sole legal ownership cases?
Need to show they’ve acquired an interest, requiring proof of:
- Common intention
- detrimental reliance
(conduct otherwise inexplicable)
What must be proven for a common intention constructive trust to arise in joint legal ownership cases?
- Must rebut presumption of ‘joint tenants in equal shares’
- by looking at whole course of conduct.
- with reference to common intention
- either express or inferred
- don’t need to show reliance
(Arises where person is seeking to show beneficial TIC in equal or unequal shares)
What factors are considered when determining common intention?
‘Whole course of conduct’ including after acquisition of property.
- Advice or discussions (best evidence)
- Reason legal title was registered in particular names
- Purpose for acquiring house
- Nature of relationship
- If parties have children
- How home was financed
- Arrangement of finances and divided responsibility
Joint tenancies - Once common intention that property should be held as tenants in common is found, what must the courts do next?
Interests must be quantified
- express intention of parties, if not
- implied by parties’ conduct
- impute an intention for ‘fair shares’ based on whole course of conduct as a last resort - holistic approach
What is not enough to show common intention for joint tenancy? Is it possible for common intention to change over time?
- Unequal financial contributions
- Yes
Where a property was purchased in joint names and both contributed but kept their finances otherwise completely separate, what was held?
It was indicative that they didn’t want a beneficial JT or to have equal shares
Words that indicate common intention for ownership:
Half yours
50:50
Words that don’t indicate common intention for ownership:
Family home
Benefit… both of us
You’ll be looked after
Sole legal ownership- How else can common intention be evidenced?
excuses as to why partner may not be jointly registered. I.e. you’re too young; you’re divorcing X.
However, inferences shouldn’t be drawn too readily and not inferred where legal owner made excuse to avoid an argument
When has common intention been declined?
- Individual caring for her family
- Woman gave up career or worked without pay
Despite woman making very substantial improvements to property and gave up job to work for man’s business so he could make payments
What should be taken into account when determining common intention?
Indirect financial contributions
Sole legal ownership - What are examples of sufficient detrimental reliance?
- Heavy DIY
- Renovations
- Payment of substantial expenses
(Inexplicable conduct)
What are examples of insufficient detrimental reliance?
- Decorating
- Giving up work to look after children
What is proprietary estoppel?
Enables a person to informally acquire property (or personal) rights to prevent unconscionable conduct
