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Published: Fri, 02 Feb 2018
In presumption, legal ownership is usually conclusive but subject to Matrimonial Causes Act(MCA) 1973 and Law of Property Act 1925. But if it was a legal ownership in one’s party name and if the title documents include declaration of trust then it is conclusive but if not, it will be argued as followed. Mary could bring the case as to the fact that Clive did not show detrimental reliance on the agreement as all he did was what any one side of the relationship would have done as seen in Gissing v Gissing that contribution to household too insignificant to give rise to interest.
The purpose of the property plays an important role as stated in the case of Lloyd’s Bank v Rosset  , there has to be an agreement, arrangement or understanding and detrimental reliance. Mary secured the mortgage of £200,000 and a cash of £50,000 into the purchase price and all Clive gave into was £5,000 into the purchase price. Thus this will be counted as direct contribution and in the case above, Lord Bridge stated that no matter how imperfectly remembered or imprecise the terms of the sharing of the property was, they will be held for it as long as there had been any agreement, arrangement or understanding was reached between them. In Gissing v Gissing  , the House of Lords (HL) held that the woman had no interest because she had not contributed anything referable to purchase but Clive did contribute to the purchase price.
Between Mary and Clive, there was an oral agreement that they were to hold the house in equal share as in the case of Hammond v Mitchell  where the court held that as long as there was a statement made thus, they shall hold the shares in whatever amount they agreed to and even though there was no written declaration of trust but if one was to see in the view of Lord Bridge, Clive would be able to claim the house in equal share. In Willmott v Barber  , Fry LJ gave five elements which needs to be fulfilled before establishing proprietary estoppel which mean that Clive would have to have made a mistake as to his legal rights, which he did not made as Mary was suppose and did have the legal estate in the property, Clive must have done some act of reliance which could or could not have been him paying the bills, Mary must know of the existence of her own right which has to be inconsistent with the right which Clive is claiming for, Mary must know of Clive’s mistaken belief and that Mary must have encouraged Clive in his act of reliance which she might have since she needed to pay the mortgage and Clive paid for the bills and the rest to make sure she would have enough wage to pay for the mortgage. However, in Conveyancer and Property Lawyer, the article “Constructive trusts and proprietary estoppel: the search for clarity and principle by Terence Etherton  , which emphasised on the statement made by Lord Scott in Yeoman’s Row which reminds one of the existence of s.2(1) of the Law of Property (Miscellaneous Provisions Act) 1989 which says that a contract for the sale or other disposition of an interest in land can only be made in writing or else it would not be a proprietary claim.
Clive would have to show that he has acted to his detriment to give rise to a constructive trust or proprietary estoppel. But the detriment would have to be of significant value, thus the issue of whether the contribution of Clive by paying some bills and carrying out the renovation project suffice. As in Thomas v Fuller-Brown  , the Court of Appeal (CA) held that merely doing all the things the man did was nothing more than any other man in a relationship would do. In Hammond v Mitchell, the court held that there was detrimental reliance in that she put her interest behind that of the bank. Had Clive not contribute to the purchase price as in Burns v Burns  , where the woman did not contribute to the purchase price and the legal title was in the man’s name only, as Lord Diplock in Gissing v Gissing state, he would not be able to claim an interest in the house as contribution to the household would be too insignificant to give rise to interest without agreement and that paying for household bills merely show an intention to share a day-to-day living arrangements and nothing more.
If a non-legal owner contributed to the purchase price, there could be a possible resulting trust in proportions of contributions or constructive trust. In Lloyd’s Bank v Rosset, Lord Bridge stated that direct contributions to the purchase price by the partner who is not the legal owner, either at the beginning or mortgage payments, will justify the inference of a creation of a constructive trust. As far as the argument goes, it shows that Clive has a good case as he fulfilled the two categories which were stated in Rosset as there was an oral agreement to share the house and that he did pay for some of the purchase price which he can argue as in the case of Grant v Edwards where the CA stated that resulting trust would need direct financial contribution to the purchase price.
If Clive is a person who has an interest in the property, first, he would have to prove interest under the Rosset case and then calculations would be made as governed by s.14 (1) of Trusts of Land and Appointment of Trustees Act 1996 (TOLATA). S15(1) governs the application for the order as subsection (a) finds out the intentions of the party who created the trusts and in this case, the intentions were that the property be of equal shares to both, (b) the purpose of this house would be as a matrimonial home as they decide to buy the house together and even though they do not marry, they gave birth to three children, (c) as this presumably a matrimonial home thus, even though the relationship broke down, but there are still minors living in it thus as long as Mary can show that there is a need for the children to still stay in the house then the courts will not grant Clive his half of the shares  .
The Law Commission Discussion Paper 2002 highlights that the current law is flawed and that it recognises that it is hard for the court to find common intention but no recommendations was given and the courts would still need to continue to ask what the common intentions between the parties were. Thus as in the case of Cox v Jones  , the courts look at all three requirements before making their decisions and base on the two categories (agreement, arrangement or understanding plus detrimental reliance or common intention), the property was bought for the purpose of living in it together thus it sound be a resulting trust but could Clive claim back the £5,000 he paid in for the purchase price as in the above case where the engagement ring was held to be hers if there was no marriage and since the relationship broke down in the case of Clive and Mary, could Clive claim back a share in the house? One would argue that it should be presume an absolute gift unless it is conditional and since they did not have any conditions prior to the produce of money, thus under Law Reform (Miscellaneous Provisions) Act 1970, under s.3(2), Mary could argue that the property be an absolute gift or that she could just pay Clive back the £5,000 and claim that it could be a loan as in the above case of the flat. The law should be just and thus, in the absence of Clive, Mary did try to pay the mortgage and take care of the children. Would it be just if the law just hand Clive the equal share? Clive would also have to come to courts with clean hands and since he did not contribute much besides the £5,000 and paid for the bills and the renovation of the house, which as the man of the house should do, then, Clive did not have much detrimental reliance which would suffice.
If the courts were to hold that shares were to be allotted to Clive, as in the case of Stack v Dowden  , where larger share will be given to the person who made larger financial contribution thus Clive should only get back what his £5,000 would have turned into if the house was sold.
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