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Trusts Law > Family Homes > Flashcards

Family Homes Flashcards

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1
Q

When are disputes as to beneficial ownership likely to arise?

A
  • when the relationship breaks down
  • when one of them dies and the estate is being administered
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2
Q

Why are disputes as to the beneficial ownership of a property unlikely to arise on divorce and dissolution of civil partnership?

A

As the court has discretion to allocate ownership fairly between the parties

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3
Q

When do trusts become important in relation to the ownership of family homes?

A

When the legal title is not representative of the beneficial ownership of the property

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4
Q

What two circumstances in relation to legal title will disputes in relation to beneficial ownership tend to arise?

A
  • sole owner - where legal title is held by one party only but the other claims a beneficial interest in the property
  • joint owners - where legal tile to the property is registered in the name of both parties, but there is no declaration as their beneficial interest and it is claimed that the parties are not beneficial joint tenants
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5
Q

How should parties ideally deal with the issue of beneficial ownership?

A

They should declare an express trust over it which complies with s 53(1)(b) LPA 1925

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6
Q

In all cases involving a trust over a family home that is not expressed expressly, what is the starting point of the courts in deciding beneficial ownership?

A

Equity follows the law - equitable title reflects legal title

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7
Q

Under the maxim equity follows the law, what is the situation where there is a sole legal owner?

A

The sole legal owner is presumed to be the sole beneficial owner

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8
Q

Under the maxim equity follows the law, what is the situation where there are joint legal owners?

A

The joint legal legal owners are presumed to be equitable joint tenants

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9
Q

Where there is joint legal ownership, is it easy to rebut the presumption that the parties are equitable joint tenants?

A

No - it is very hard to rebut and requires strong evidence of a common intention that they were intended to be anything other than joint tenants in equity too

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10
Q

What is the two step process followed by the court in joint legal ownership cases?

A

(1) Rebutting the presumption - did the parties have a common intention to hold the property other than as joint tenants?

(2) Quantification - if the parties are not joint tenants, they must be tenants in common but in what proportions?

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11
Q

How will the court assess whether the presumption has been rebutted in cases of joint legal ownership?

A

The court will assess the evidence of the parties’ shared intention which may be ascertained in light of the whole conduct of the parties

Holistic approach

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12
Q

What factors will the court consider in their holistic approach to ascertaining the shared intention of the parties with regards to equitable ownership?

A
  • advice or discussions which may indicate intention
  • reason legal title was held in particular names
  • nature of the relationship
  • purpose for which the parties acquired the house
  • whether the parties have children
  • how the house was financed
  • how the parties arranged other finances and divided responsibility for household finances
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13
Q

How does the court approach the question of quantification in regards to joint legal ownership of the family home?

A

They take into account the whole course of conduct of the parties and search for their actual intention of the parties as to what portions the land should be held in

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14
Q

What happens if the court is unable to ascertain intention as to quantification between the parties with regards to joint legal ownership of the family home?

A

Then the court will impute an intention for ‘fair shares’ based on the whole course of conduct of the parties

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15
Q

When imputing the intention of the parties, what question will the courts ask?

A

‘what their intentions as reasonable and just people would have been had they thought about it at the time’

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16
Q

With regards to joint legal ownership of the family home and quantification, what effect will keeping rigidly separate finances have?

A

Will be indicative that parties did not intend to have a beneficial joint tenancy

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17
Q

With regards to joint legal ownership of the family home and quantification, will one party carrying the full financial burden of the property rebut the presumption of joint beneficial ownership?

A

Not necessarily - further evidence in addition will be required

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18
Q

What is meant be intention can be ambulatory in cases involving trusts over family homes?

A

Means that it is possible for common intention of the parties to change over time such at end of relationship

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19
Q

With regards to joint legal ownership of the family home and quantification, what effect will separation have?

A

Separation alone will be unlikely to rebut presumption of joint tenants

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20
Q

What is the two-step process with sole legal ownership when challenging the presumption that the sole legal owner is the sole beneficial owner?

A

1) Establishing an interest:

  • did the parties have a common intention for the non-legal owner to acquire beneficial interest?
  • has the person relied on this to their detriment?

2) Quantification - if the non-legal owner can establish an interest, what is the quantum of that interest as a proportion of the property?

21
Q

What are the two main ways whereby a person can establish a common intention constructive trust over the family home in sole legal ownership cases?

A

a) Evidence of an express common intention as to the shared ownership of the property followed by detrimental reliance by the non-legal owner

b) Court can infer common intention from the parties’ conduct followed by detrimental reliance

22
Q

If the courts are inferring common intention to create a constructive trust over the family home in sole legal ownership cases, what factors will they consider?

A

They will consider the whole course of conduct of the parties - take a holistic approach

23
Q

When considering statements the parties had about the property, what will the courts look for as evidence as express common intention to create a constructive trust over the family home in sole legal ownership cases?

A
  • they will look for statements about shared ownership not merely shared occupation
  • common intention may be evidenced by legal owner providing excuse as to why their partner may not be jointly registered as the legal owner
24
Q

What words are likely to indicate common intention to create a constructive trust over the family home in sole legal ownership cases?

A
  • half yours
  • 50:50
25
Q

What words are unlikely to indicate common intention to create a constructive trust over the family home in sole legal ownership cases

A
  • family home
  • benefit for both of us
  • you will be looked after
26
Q

What excuses are likely to indicate common intention to create a constructive trust over the family home in sole legal ownership cases?

A
  • you’re too young to own a property
  • it’s your divorce (not sharing legal ownership as it would prejudice partner’s divorce)
27
Q

What excuses are unlikely to indicate common intention to create a constructive trust over the family home in sole legal ownership cases?

A
  • excuses as to avoiding an argument
28
Q

Can common intention to create a constructive trust over the family home in sole legal ownership cases be found where there are limited financial contributions from the other party?

A

Yes - strengthened if combined with other factors - such as cooking all family meals and caring for children

29
Q

Can common intention to create a constructive trust over the family home in sole legal ownership cases be found where there are indirect financial contributions from the other party?

A

Yes - allows other party to pay the mortgage

30
Q

What effect will substantial improvements have in deciding whether or not constructive trust over the family home in sole legal ownership cases?

A

Likely means there is one

31
Q

What amounts to detrimental reliance in cases to create a constructive trust over the family home in sole legal ownership cases?

A

Conduct which the claimant could not reasonably have been expected to embark unless they were to have an interest in the house

Conduct to their detriment relating to joint lives of the parties

32
Q

What examples of detrimental reliance have the courts found?

A
  • heavy DIY
  • renovations to house
  • payment of substantial expenses (including mortgage)
33
Q

What examples have the courts found have not amounted to detrimental reliance?

A
  • decorating
  • giving up work to look after children
  • looking after family and playing traditional wife role
34
Q

What factors will the court consider in relation to quantification of claims in cases to create a constructive trust over the family home in sole legal ownership cases?

A

1) if there is evidence of express common intention as to the shares this ought to be conclusive

2) if no express intention, court will look to infer common intention considering all the factors

3) if neither of the above possible, courts may impute intention in light of whole course of dealing

35
Q

What is proprietary estoppel?

A

Equitable doctrine whereby a person informally acquires property rights.

36
Q

What is the key difference between proprietary estoppel and promissory estoppel?

A

Promissory estoppel can only act as a defence.

Proprietary estoppel can be a defence and a cause of action (basis of claim)

37
Q

What is the objective of proprietary estoppel?

A

To prevent unconscionable conduct

38
Q

What is the result of a successful proprietary estoppel claim?

A

It gives rise to an equity. The court determines how’s to satisfy that equity and enjoys broad discretion in doing so

39
Q

What elements are required for a successful proprietary estoppel claim?

A
  • an assurance is made to the claimant
  • reliance by the claimant on the assurance
  • detriment to the claimant in consequence of their reliance
  • must be unconscionable for defendant to resile from the assurance
40
Q

What form of assurance is required for a successful proprietary estoppel claim?

A

Assurance must be one that claimant has or will acquire a right in the property owned by the defendant

Right can be broad can include ownership, lease, easement etc

41
Q

What factors about assurances did the court highlight in the case Thorner v Major for a successful proprietary estoppel claim?

A
  • assurance need not be explicit - can be inferred from indirect statements
  • relevant assurance must be ‘clear enough’ and whether it is clear enough ‘is hugely dependant on context
  • task of the court is to ascertain how the defendant’s words would have been reasonably understood by the claimant in the context in which they were spoken
42
Q

What form of reliance is required for a successful proprietary estoppel claim?

A

There must be reliance by the claimant on the defendant’s assurance.

There has to be a sufficient link between the defendant’s assurance and the claimant’s detrimental conduct.

Assurance does not have to be sole cause of reliance but has to be sufficient cause.

43
Q

What form of detriment is required for a successful proprietary estoppel claim?

A

Detriment to the claimant in consequence of their reliance on the defendant’s assurance.

44
Q

In Gillett what did the court say about the form of detriment that is required for a successful proprietary estoppel claim?

A
  • detriment is not a narrow or technical concept
  • detriment must be approached as part of a broad inquiry as to whether repudiation of an assurance is or not unconscionable in all circumstance
  • countervailing benefits can be taken into account when assessing whether the claimant’s reliance was detrimental
  • court must determine whether conduct is detrimental on the assumption that the defendant will dishonour the assurance
45
Q

What have the court upheld as detriment for proprietary estoppel claims?

A
  • expenditure
  • provision of services without payment or for less than market value
  • subordinating himself to the defendant and allowing the defendant to make significant choices concerning the claimant and his family
  • passing up opportunities to better themselves or to live a better life - choosing to not pursue educational, employment, or business opportunities
46
Q

What is unconscionability in a successful proprietary estoppel claim?

A

Behaviour that shocks the conscience of the court

47
Q

What will the court have regard to when considering remedies for a successful proprietary estoppel claim?

A
  • all the circumstances of the case
  • the claimant’s expectation and detriment
48
Q

The court has discretion in granting remedies for proprietary estoppel. What remedies may it award?

A
  • transfer ownership of property to defendant
  • hold property on trust for the claimant
  • grant the claimant a property right over defendant’s property (eg easement)
  • grant the claimant a personal right over defendant’s property (eg a licence)
  • pay a sum of money to the claimant
49
Q

In Jennings v Rice, what three principles did the court lay down to regulate the exercise of judicial discretion in granting remedies for proprietary estoppel?

A
  • the remedy should not exceed the claimant’s expectation
  • the court may award a remedy which satisfies the claimant’s expectations but it is not required to do so (and in some cases it would be inappropriate to do so)
  • remedy must be proportionate to the claimant’s detriment

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