Trusts of the Family Home

Question 1

What is the main purpose of a constructive trust in equity?

Answer 1

To prevent unjust enrichment by imposing a remedial trust where a person’s conscience is affected by unconscionable conduct relating to property or money

Question 2

How does equity typically operate in the context of trusts?

Answer 2

Equity acts in personam, meaning it binds individuals rather than the property itself

Question 3

What’s the difference between express and inferred common intention constructive trusts?

Answer 3

• Express: Based on an explicit agreement and requires detrimental reliance
• Inferred: Based on the parties’ conduct, such as direct or indirect financial contributions

Question 4

What key legal test did Lloyds Bank v. Rosset establish?

Answer 4

That a constructive trust requires either:

1. An express agreement and detrimental reliance; or
2. Inferred common intention through direct financial contributions. Renovation alone is insufficient

Question 5

How did the court assess the wife’s beneficial interest in Midland Bank v. Cooke?

Answer 5

The court rejected strict contribution-based (6%) and awarded 50%, considering the whole course of dealings between the parties

Question 6

Can indirect contributions support a constructive trust?

Answer 6

Yes—indirect financial contributions (e.g., paying bills, running a business, inheritance used for mortgage) can support inferred common intention

Question 7

What approach did the court take in quantifying interest in Oxley v. Hiscock?

Answer 7

A broad approach, considering both financial and non-financial contributions to establish and quantify a constructive trust

Question 8

How does a claimant establish a beneficial interest if the property is in the other party’s sole name?

Answer 8

By proving either a resulting trust (direct contribution) or a constructive trust (indirect contribution and common intention), followed by quantification via the whole course of dealings

Question 9

When can the 50-50 presumption in joint ownership be rebutted?

Answer 9

When financial contributions and other factors (like who paid bills or mortgage) show unequal intentions—Ms. Dowden received 63%

Question 10

How did the court treat changing intentions over time in Jones v. Kernott?

Answer 10

The Supreme Court found that beneficial interests can change; Mr. Kernott’s share decreased due to his lack of contribution after moving out

Question 11

What is the default legal and equitable position when a property is purchased in joint names?

Answer 11

The default is a 50-50 split, but this presumption can be rebutted by evidence of unequal contributions, intentions, or changed circumstances

Question 12

What 4 key factors do courts consider when determining the existence and shares of a constructive trust?

Answer 12

Courts look at:
1. Financial contributions (direct & indirect)

2. Nature of the relationship
3. Purpose of the property
4. The entire course of dealings between the parties

Question 13

What is the main difference between constructive and resulting trusts in cohabitation disputes?

Answer 13

• Resulting trusts rely strictly on direct financial contributions
• Constructive trusts consider intentions and whole conduct, allowing indirect contributions to establish or quantify interest