Question 1

The establishment and quantification of an interest in the family home by using the law of trusts applies nowadays only to unmarried couples.

Accepted Answer

The law of trusts can be used to establish and quantify an interest in the family home for both married and unmarried couples.

Question 2

How much detrimental reliance is needed for the non-legally owning party to establish a constructive trust?

Accepted Answer

The concept of detrimental reliance is central to the establishment of a constructive trust in cases where legal ownership does not reflect the equitable interests of the parties involved. A constructive trust is an equitable remedy that a court can impose to correct injustice or prevent unjust enrichment when one party holds property under circumstances that would make it inequitable for them to retain it.

To establish a constructive trust based on detrimental reliance, the non-legally owning party (the claimant) must demonstrate the following elements:

1. **Representation or Conduct**: The claimant must show that the legal owner made a representation or engaged in conduct that led the claimant to believe they would have some right, interest, or benefit in the property.

2. **Reliance**: The claimant must have relied on this representation or conduct. This means that the claimant took some action or refrained from taking action based on the belief created by the legal owner's representation or conduct.

3. **Detriment**: The reliance must have been to the claimant's detriment. This means that the claimant suffered some form of harm or loss as a result of their reliance on the legal owner's representation or conduct. The detriment can be financial, but it can also be non-monetary, such as the loss of an opportunity or the expenditure of time and effort.

4. **Unjust Enrichment**: It must be shown that it would be unjust for the legal owner to retain the benefit of the property without compensating the claimant. This is often demonstrated by showing that the legal owner would be enriched at the claimant's expense if a constructive trust were not imposed.

The amount of detrimental reliance needed to establish a constructive trust can vary depending on the circumstances of the case and the jurisdiction. There is no fixed standard or threshold; rather, the court will consider whether, in the context of the particular situation, the detriment suffered by the claimant is substantial enough to warrant the imposition of a constructive trust.

It is important to note that the specifics of establishing a constructive trust can vary by jurisdiction, as different legal systems may have different requirements and precedents. Therefore, it is advisable to consult with a legal professional who can provide guidance based on the relevant laws and cases in the applicable jurisdiction.

Question 3

Which case held that when establishing a Lloyds Bank v Rosset 'category two' trust, the non-legally owning party must establish a common intention to share the property by conduct?

Accepted Answer

The case that held that when establishing a Lloyds Bank v Rosset 'category two' trust, the non-legally owning party must establish a common intention to share the property by conduct is the case of Lloyds Bank plc v Rosset itself. The citation for this case is [1991] 1 AC 107, [1990] 2 WLR 867, [1990] 1 All ER 1111, and it was decided by the House of Lords.

In Lloyds Bank v Rosset, Lord Bridge laid out two categories for establishing a beneficial interest in a property under a constructive trust in situations where the property is in one party's name only:

1. Category one: There is direct evidence that both parties intended to share the ownership of the property. This could be through an explicit agreement, arrangement, or understanding.

2. Category two: Where there is no express agreement, the intention to share the property must be inferred from the conduct of the parties. This conduct must be indicative of a common intention to share the beneficial interest and must go beyond merely contributing to household expenses. It typically involves a significant contribution to the acquisition of the property, such as payment towards the purchase price or substantial improvement of the home.

In the Rosset case, the House of Lords held that the non-legal owner (Mrs. Rosset in this case) had to demonstrate that there was a common intention to share the beneficial interest in the property, and that this intention was deduced from her conduct. However, in this particular case, Mrs. Rosset was unable to establish such a common intention based solely on her conduct, which included supervising and participating in renovation works, as it was not deemed sufficient to demonstrate a shared intention to own the property.

The Lloyds Bank v Rosset case is a leading authority on the establishment of constructive trusts in the context of cohabiting couples and the division of property when relationships break down. It sets a high threshold for the non-legal owner to prove a common intention to share the beneficial interest in the property through conduct.

Question 4

Name a case that demonstrated the courts are prepared to take a relatively wide view of contributions which may show evidence of conduct upon which this type of trust may be based.

Accepted Answer

The answer of Name a case that demonstrated the courts...

Question 5

What was held to be a direct contribution to the purchase price in Midland Bank plc v Cooke (1995) 27 HLR 733?

Accepted Answer

The answer of What was held to be a direct...

Question 6

Which case seems to go against the orthodox position that only direct payments towards the purchase price of the property are sufficient to establish a common intention trust based on the parties' conduct alone?

Accepted Answer

The answer of Which case seems to go against the...

Question 7

What did Stack v Dowden concern?

Accepted Answer

The answer of What did Stack v Dowden concern?...

Question 8

Name a decision since Stack v Dowden and Abbott v Abbott where the court has shown no inclination to widen the types of contribution that may be used to establish a trust of Lord Bridge's second category.

Accepted Answer

The answer of Name a decision since Stack v Dowden...

Question 9

Which Court of Appeal case recognises the quantification of the second type of Rosset trust on constructive trust lines?

Accepted Answer

The answer of Which Court of Appeal case recognises the...

Question 10

In which two situations did Lord Bridge in Lloyds v Rosset (1991) 1 AC 107 state that a constructive trust could arise?

Accepted Answer

The answer of In which two situations did Lord Bridge...

Question 11

Which section of the Law of Property Act 1925 provides that constructive trusts do not need to be evidenced in writing?

Accepted Answer

The answer of Which section of the Law of Property...

Question 12

The HL in Pettitt v Pettitt (1970) AC 777 and Gissing v Gissing (1971) AC 886 laid down a fairly broad test for recognising that a non-legal owning spouse should be entitled to an equitable interest in the property.

Accepted Answer

The answer of The HL in Pettitt v Pettitt (1970)...

Question 13

A more generous result appears to have been reached for the non-legally owning spouse by Lord Denning MR in the Court of Appeal's decision in Eves v Eves (1975) 1 WLR 1338.

Accepted Answer

Lord Denning MR's decision in Eves v Eves was seen as more generous towards the non-legally owning spouse in comparison to previous case law.

Question 14

Lord Bridge in Lloyds Bank v Rosset, expressly approved the earlier cases of Eves v Eves and Grant v Edwards (1986) Ch 638 as examples of where a trust would be recognised by the courts in his first category of constructive trusts.

Accepted Answer

Lord Bridge in Lloyds Bank v Rosset did approve the earlier cases of Eves v Eves and Grant v Edwards as examples of where a trust would be recognised by the courts in his first category of constructive trusts.

Question 15

In order to successfully establish a Lloyds Bank v Rosset 'category one' trust, it must be based on a common intention that is shared between the parties.

Accepted Answer

A Lloyds Bank v Rosset 'category one' trust requires that there is a shared common intention between the parties involved. This means that each party must have intended for the property to be held in trust for their joint benefit, even if this was not explicitly stated at the time. Without this common intention, a 'category one' trust cannot be established.

Question 16

Lord Bridge in Lloyds Bank v Rosset held that only 'direct contributions' towards the purchase price of the property would be enough to establish a category 2 trust.

Accepted Answer

This is correct as Lord Bridge did indeed state in Lloyds Bank v Rosset that a category 2 trust could only be established by direct contributions towards the purchase price of a property.

Question 17

Baroness Hale tried to narrow Stack v Dowden in Privy Council case of Abbott v Abbott (2007) UKPC 53.

Accepted Answer

In Abbott v Abbott (2007) UKPC 53, Baroness Hale did not try to narrow Stack v Dowden; instead, she applied the principles from Stack v Dowden, emphasizing the importance of the parties' intentions in determining the ownership of a property held in joint names.

Question 18

When an agreement and detrimental reliance leads to the creation of a constructive trust, but where the parties have not themselves quantified their shares, the court has a wide discretion how a party's share should be calculated, taking into account the parties' entire conduct.

Accepted Answer

This statement is true. When there is no explicit agreement on the shares of the parties in a constructive trust, the court can use its discretion in determining the allocation of shares based on the parties' conduct.

Question 19

Chadwick LJ in Oxley v Hiscock (2005) Fam 211 stated that a party 'is entitled to that share which the court considers fair having regard to the whole course of dealings between them in relation to the property.'

Accepted Answer

This is a correct statement made by Chadwick LJ in Oxley v Hiscock (2005) Fam 211 regarding the division of property in a cohabitation dispute.

Question 20

In which two circumstances did the Supreme Court in Jones v Kernot (2011) UKSC 53 state that the resulting trust approach would be appropriate for quantifying an equitable interest?

Accepted Answer

The answer of In which two circumstances did the Supreme...

Quiz 14: Trusts of the Family Home