Trusts of the Family Home Flashcards
When a non-married couple separate, how can you determine who is beneficially entitled to the family home?
By express trust (often done when couple purchase the home in their joint names):
- Usually done in the TR1 transfer deed
- Must be evidenced in signed writing
- If there is an express trust, this will be determinative
By resulting trust:
- Tracks monetary contribution to the purchase price at the time of purchase only (not eg. paying mortgage)
By common intention constructive trust
By proprietary estoppel
What are the two stages of establishing shares in the family home under a common intention constructive trust?
Stage 1: Establishing a trust
Is the house jointly or solely owned?
Can the non-sole owning partner demonstrate the existence of a common intention constructive trust?
Stage 2: Quantifying the trust
Considering various factors to determine the partner’s share in the family home
How are beneficial shares quantified when the family home is jointly owned?
If the family home is jointly owned (ie. both names on the title register), there is a presumption of joint & equal beneficial shares (a CICT is presumed
→ If one partner wants a bigger share, they must show an agreement / common intention to that effect + reliance on that agreement/intention to their detriment
Court will take into account various factors when surveying the whole course of dealing between the partners
NB. It is v. rare that joint owners will be considered to have intended anything other than equal shares → must have evidence that the couple intended throughout their relationship to keep their financial affairs separate
What are some of the factors that the court may take into account when quantifying shares of the family home?
(a) advice or discussions ** at the time of purchase**
(b) the reasons why the home was transferred into their joint / sole names
(c) the nature of the partners’ relationship
(d) whether they had children for whom they had a responsibility to provide a home
(e) how the purchase was financed, both initially & subsequently
(f) how the partners arranged their finances
(g) how the partners discharged the outgoings on the home & other household expenses
What are the two stages in quantifying the beneficial interests in the family home when the family home is solely owned?
Stage 1 - Common intention constructive trust must be established
Stage 2 - the beneficial interests must be determined
What presumption arises if the family home was jointly owned?
A presumption of joint & equal beneficial shares in the home
When the family home is solely owned, how can the non-owning partner demonstrate the existence of a common intention constructive trust?
Method 1: Express common intention + detrimental reliance
- Express: some kind of (typically oral) agreement or understanding by the partners that both partners were to have an interest in the family home (eg. draft conveyancing doc never signed, emails)
- Detriment: need not be financial expenditure - non-financial detriment (eg. looking after kids) likely to be sufficient so long as it is substantial
Method 2: Inferred common intention + detrimental reliance
- Inferred from the couple’s conduct
- Traditionally courts will only infer common intention from monetary contributions (either to purchase price or paying off mortgage)
Once a CICT has been established, how are the beneficial shares in a solely-owned family home quantified?
→ If there is an agreement that the claimant should have some defined share, the court will give effect to it
→ If there is no agreement, the court determines shares by reference to what is fair given the whole course of dealing - will consider:
(a) advice or discussions at time of purchase
(b) reasons why home is solely owned
(c) nature of partners’ relationship
(d) any children for whom they had a responsibility to provide a home
(e) how the purchase was financed initially & subsequently
(f) how the partners arranged their finances
(g) how they discharged the outgoings & expenses on the home
What are the two stages to a proprietary estoppel claim for the family home?
Stage 1 - the estoppel must be established
Stage 2 - the estoppel must be satisfied (remedies)
How does the claiming party establish estoppel re family home?
I. Assurance: legal owner must have made a representation or created & encouraged an expectation that the claiming party would become entitled to an interest in land (can be active or passive)
II. Detriment: claiming party acted to their detriment in reliance upon the assurance made
- Detriment need not be money, so long as it is something substantial
III. Reliance: the assurance & detriment must be connected, ie. assurance must cause the claiming party to act to their detriment
- Doesn’t need to be sole reason for claiming party’s conduct, but must be a reason
What are some of the remedies the court can grant a claiming party in proprietary estoppel re family home?
Transfer of the legal ownership in land
Grant of a lease
Some right of occupancy
Financial occupation
Beneficial share in the home
What are the bars from obtaining a remedy in proprietary estoppel?
- If the claiming party’s conduct is inequitable or unconscionable (must come to equity with ‘clean hands’)
- An unreasonable delay in bringing a claim
