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National Provincial Bank Ltd V Ainsworth.

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Introduction

Case 1: National Provincial Bank Ltd V Ainsworth (May 1965) Case Outline > Mr and Mrs Ainsworth lived together in their home of which the mortgage was in the name of Mr Ainsworth with National Provincial Bank. The land was registered. > During the term of the mortgage repayment Mr Ainsworth fell into arrears and on defaulting on the mortgage Mr Ainsworth deserted Mrs Ainsworth who was still living in the house. > On National Provincial Bank attempting to evict Mrs Ainsworth she resisted and as a consequence the case went to court. > At a final court of appeal it was found that Mrs Ainsworth held an Equitable Interest* in the property and thus the bank was in no position to sell while the wife had rightful occupation of the property. *An equitable interest or an overriding interest takes precedence over everything else. This interest does not need to be registered to affect other people (in this case the bank) dealing with the land. > National Provincial Bank appealed against this decision and the case went to the House of Lords. At the appeal hearing the decision originally made was reversed and the bank was given the right to evict Mrs Ainsworth. > The House ruled that appeal would be held because otherwise it would work as a "clog on the legal title" and it was "contrary to the sanctity of contract". ...read more.

Middle

Case 2: Caunce V Caunce (1969) Case Outline > Mr Caunce was the legal owner of the property with the mortgage in his name. The land was unregistered. > Without the knowledge of Mrs Caunce Mr Caunce conveyed the property into his own name. He then falls into arrears and defaults on the mortgage on the house. He subsequently deserts Mrs Caunce leaving her in the household but with the household no longer in both of their names. > At this time Mrs Caunce has no "Class F" charge (applicable only for unregistered land) but still tries to argue that she has an overriding interest in the property. > The case was heard at the House of Lords but the judge did not hold the case of Mrs Caunce stating that we could not have banks being "snoopers and busybodies". Evaluation and Consequences The judge was implying in this case that there was no means for banks of identifying whether someone has an overriding interest in a property or not. If this case was therefore held banks would have to become "snoopers and busybodies" to obtain this information in future. He argued that this is not in the interest of the public as a whole and thus the case was dismissed. The Law of Property Act (1925) s.87 states it is not the responsibility of the bank to enquire as to whether the spouse has made a contribution to the purchase price of the house on acquisition, whether he/she has an account with the same bank or not. ...read more.

Conclusion

> Mr Rosset later defaulted on repayments and the bank sought possession of the property. > Mrs Rosset resisted and claimed a beneficial/equitable interest on the property due to her many contributions in the renovation of the house. > The case went all the way to the House of Lords where it was held that Mrs Rosset did not have beneficial interest in the property. Evaluation Despite the fact that Mrs Rosset argued she had an overriding interest under the Land Registration Act (1925) s.70 (1) (g). Mrs Rosset lost the case for a number of reasons. Firstly it was dubious whether Mrs Rosset was in occupation when the charge was created to rely upon the land registration act. Secondly there was contrary intention from the trustee(s) who left the money; the house must be in the name of Mr Rosset solely. Thirdly Mrs Rosset had made substantial contributions to the building work on the house but as the Matrimonial Homes Act (1983) states there must be a financial contribution such as a mortgage repayment. Furthermore Mrs Rosset had not registered her interest in the property and therefore could have no claim to rights of occupation even if she had been deemed to make a financial contribution to the property. This case illustrates perfectly how the Matrimonial Homes Act (1983) tidied up the problematic areas surrounding the issue and thus cases are far more clearly cut and indisputable in future. ...read more.

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