Trusts of the Family Home Flashcards

1
Q

Express trust of family home

A

Declaration of trust sets out beneficial interests. Must be in signed writing.

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2
Q

Resulting trusts of the family home

A

a) Only contributions towards the purchase price count.

(b) Only contributions made at the time of purchase count.
A cash payment towards the
deposit (on exchange of contracts) or the completion price gives rise to a resulting trust.
Doesn’t create trust if you pay towards mortgage not in your name.

(c) A resulting trust only recognises monetary contributions.

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3
Q

Common intention constructive trusts - home is jointly owned

A

Trust implied. Presumed beneficial interest in home joint and equal like legal title.

If a claiming partner wants to persuade the court they should be entitled to a larger beneficial
share, not only must they evidence an agreement or common intention to that effect, but also
that they relied on that agreement/intention to their detriment - usual case.

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4
Q

Common intention constructive trusts - home is solely owned

A

The partner whose name is not on the legal title has the burden of establishing that they are entitled to a beneficial interest.

2 stages to follow:
* Stage 1 – the common intention constructive trust must be established; and
* Stage 2 – the beneficial interests under the trust must be determined or quantified.

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5
Q

Common intention constructive trusts - home is solely owned - stage 1: establishing the trust

A

Only established if it can be shown that:
(a) there was a common intention between the partners that both were to have an interest;
and that
(b) the claiming partner acted to their detriment in reliance on that common intention.

2 methods:

1: Express common intention + detrimental reliance
Agreement (can be oral) or understanding.

2: Inferred common intention + detrimental reliance
Court has to look at the couple’s conduct.
Generally only be inferred from:
(a) a direct contribution to the purchase price; or
(b) a significant contribution to mortgage payments falling due after the purchase.

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6
Q

Common intention constructive trusts - home is solely owned - stage 2: quantifying the beneficial shares

A

No presumption of joint beneficial ownership.

If the partners came to an agreement as to the size of their respective beneficial interests,
then that agreement will be respected.

If no evidence, the court will award such shares as it
considers fair.

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7
Q

Proprietary estoppel

A

Another method by which a partner may become entitled to an interest in the family home.

Asks whether it would be unfair for a party to go back on their word in relation to a property. Provide relief to party that has suffered detriment.

Used when friend been promised house will be there’s when I die then it is left to someone else in will.

2 stages:
* Stage 1 – the estoppel must be established; and
* Stage 2 – the estoppel must be satisfied (remedies).

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8
Q

Proprietary estoppel - stage 1: establishing the equity

A

3 key elements to establishing a claim in proprietary estoppel:

(a) Assurance
Can be active or passive e.g. tells them or conduct which clearly suggests they think they have a right to the property.

(b) Detriment
Doesn’t have to be money. Has to be substantial.
Detriment must be weighted against any benefits obtained e.g. living rent free in property.

(c) Reliance
Assurance must cause the
claiming party to act to their detriment.
Assurance do not have to be sole reason for claiming parties conduct.
E.g. C gives up job to look after elderly relative. New legal owner may argue that the claiming party’s conduct arose out of ‘natural love and affection’ for the elderly
relative, rather than proprietary self- interest.

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9
Q

Proprietary estoppel - stage 2: satisfying the equity (remedies)

A

Ordinarily court will hold the legal owner to their assurance.

The burden is on the legal owner to prove that enforcing the assurance would be out of all proportion to the detriment sustained by the claiming party.

Ask what remedy will do justice between parties.

Remedies that the court can grant include:
(a) transfer of the legal ownership in land;
(b) grant of a lease;
(c) some right of occupancy (eg the right to live in a house rent-free for life);
(d) financial compensation; or
(e) a beneficial share in the home.

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10
Q

Proprietary estoppel - barred from claiming remedy

A

(a) If the claiming party’s conduct is inequitable or unconscionable.
Must come with clean hands.

(b) An unreasonable delay in bringing a claim in proprietary estoppel may defeat the
claim. Equity does not assist a party who has failed to assert their rights within a
reasonable time – ‘delay defeats equity’.

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