Trusts of the family home

Question 1

Legal title in the name of one member of the couple

Answer 1

Where one member of the couple is the sole proprietor of the property according to the legal title registered at HM Land Registry, the presumption is that the property is owned wholly by that person. The legal title indicates they are the sole owner, and the equitable presumption is that ‘Equity follows the law’.

Thus, if the other member of the couple is to obtain a share of the property, that other member must rebut the presumption that Equity follows the law.
If the other member of the couple manages to rebut the presumption, then the court will try to determine what the common intention of the couple was regarding division of the property between them

Question 2

Legal title in both names

Answer 2

Where both members of the couple are registered proprietors of the property, the presumption is that Equity follows the law and that they own the property in equal shares—namely, a 50:50 split.

Thus, if one member of the couple is to obtain a greater share of the property, they will have to rebut that presumption and show that there was a common intention that the couple were holding the property in unequal shares. This presumption is quite strong, and it is possible that a party seeking to rebut the presumption will not be able to do so.

Question 3

Establishing the parties common intention

Answer 3

Whether the house is in sole or joint names, if the presumption that the legal title reflects the equitable interests is rebutted, the court then has to determine what shares the parties should have in the property.

The intention of the couple may be express, inferred or imputed. If there was a written document evidencing the couple’s intention, then the trust will be an express one, but if their intention was expressed orally, it can be seen as a constructive trust.

If there is no evidence of express statements, then the couple’s intention may be inferred from surrounding circumstances.

Question 4

What are the four elements in proprietary estoppel?

Answer 4

A successful claim for proprietary estoppel will give a volunteer an equitable interest in a property provided certain elements are present:

• there must be a representation by the owner of the legal title that the claimant has, or will have, an interest in the property;
• the claimant must have relied upon that representation;
• the claimant must have suffered detriment due to - the reliance on the representation;
• the defendant’s conduct must have been unconscionable.