Property law report - Whether Carol has rights in the property

One objection to the use of actual intention approach in the leading cases of Eves v Eves and Grant v Edwards is that the legal owner did not intend to share ownership. The reason why the claimants name was not put on the deeds was in such case an excuse, the legal owner having no intentions of giving up sole ownership. It is possible that David had no intentions of giving up sole ownership and that he did not want Carol to have any interest in the flat. In Springette v Defoe the court held that although the parties had not discussed interests in the flat, they had a common but uncommunicated intention. Therefore, if the principal in this case is followed, it is evident that Carol would have an interest in the flat.

However, as far back as Gissing v Gissing, Lord Diplock stressed that common intention is to be tested objectively. If one party leads the other to believe that a common intention exists, then private reservations will not refute the common intention. Therefore, David cannot deny Carol interest in the flat.

Despite Carol not being party to any valid express declaration of trust (Law Of Property Acts), she may establish a beneficial interest by providing a constructive or resulting trust. From the facts given, it seems more probable than not that Carol has established an equitable interest in the flat and this in equity means that the flat is co-owned. Thus, a trust of land is in existence where David holds the flat on trust for himself and Carol in equity (Bull v Bull), there is one trustee of land and two co-owners in equity.

If the principal in Rimmer v Rimmer is followed, then Carol would have an interest in the flat as it would be unjust to deny her an interest in the flat as she is paying the monthly sum equal to that of David. However, the facts are not very clear as to whether David was actually living with Carol. Although he has lent his name for the purpose of the mortgage (as Carol could not obtain one) does not automatically mean that David is living with her in the flat. Therefore, if the principal in McKenzie v McKenzie were followed, David would not have an interest in the flat although he has lent his name for the purpose of the mortgage.

(b) WHETHER CAROL CAN CLAIM RIGHTS TO THE MILL

Improvements to the mill may be difficult to link with common intention. The leading case is Pettit v Pettit, where the courts held that improving property by itself is not enough. Therefore, Carol would not have interest in the mill on the basis of supervising the restoration work.

Although many of the dicta concentrate on the question whether the facts can justify an inference as to the parties intentions at the time of purchase, several leading cases such as Gissing v Gissing and Austin v Keele have recognised that a subsequent intention will be effective. From the facts that have been given, it seems evident that Carol and David had a common intention to live in the mill together once it had been restored.

Carol has contributed financially to the purchase of the mill and has also acted to her detriment as she has given up her employment; therefore, she should have an interest in the mill (Eves v Eves).

The facts in the question with regard to Carol seem to fit with Lloyds Bank Plc v Rossett, where the claimant has spent a lot of time supervising restoration work on the house as well as doing some work herself. Lord Bridge held that there was a detriment. Therefore, if the principal in Lloyds Bank Plc were followed, it is evident that Carol would have an interest in the flat.

As Carol did some work to the mill, courts may sometimes regard this as common intention. Where the work is substantial, then it may be possible to persuade the courts to find a common intention. The threshold for this will be high, the work must be of the type that a contractor would normally be brought in to undertake (Button v Button, Windeler v Whitehall).

However, because Carol is a woman, it is possible that the work she was doing on the mill was very physical and it is also possible that if she thought she never had an interest in the mill, she would not have done the work (Grant v Edwards). From the facts given, it seems evident that David has given assurance (Clough v Killey) to Carol that she had an interest in the mill and Carol has relied on this to her detriment (Ungarian v Lesnoff) (giving up her employment), therefore David cannot deny the interest promised (Grant v Edwards). Hence, Carol can be the beneficiary of a constructive trust, and be entitled to an equitable interest in the mill with her interest equivalent to what she had been promised or deprived of.

( c )  HOW SIZE WILL BE CALCULATED

If there is an express agreement as to size of share, it will govern (Oxley v Hiscock). However, with the situation between Carol and David, it is evident that they do not have an express agreement as to the share and therefore, it will be left to the court to decide as to how much each part is entitled to.

When considering the question as to shares, there are two basic alternatives; firstly, that the share should be proportionate to the capital and income contributions (Huntingford v Hobbs). The second possibility is to choose a proportion representing what the parties would have agreed had they thought about it.

It was recognised in Pettitt v Pettitt that problems of assessing shares may well be so difficult that the only sensible answer is to decide on equality in the order to server the Gordian knot. However, the general adoption of equality was heavily criticised in Gissing v Gissing.

 A more radical approach was however, adopted by the Court Of Appeal in Midland Bank Plc v Cooke. The duty of the judge is to undertake a survey of the whole course of dealing between the parties relevant to their ownership and occupation of the property and their sharing of its burdens and advantages.

However, Drake v Whipp decided after Midland Bank Plc provided a contrast. In the 1980’s cases began to look much more closely at financial contributions and to relate shares to those contributions.

In Eves v Eves, the court held that where a man leads a woman (to whom he is not married) to believe that she is to have an interest in the property, they will find a constructive trust in the favour of the woman. Therefore, if the principal in Eves v Eves is followed, it is evident that the courts will find that Carol has an interest in the mill because the facts state that David told Carol that they would live in the mill once it was restored. Therefore, David has lead Carol to believe that she has an interest in the mill and he cannot go back on his word.

(d) WHETHER DAVID CAN CLAIM THE CAR

The clearest case is evidence that one party (David) intended to make a gift to the other party (Carol). If there is express evidence of words of gift, then effect will be given to these.

From the facts that have been given in the question, it is evident that David has bought the car and intended it to be a gift to Carol as he has clearly stated this according to the facts in the question. In Beechor v Major the courts held that the investments were gifts. Therefore, if the principal in Beechor is followed, it is more probable than not that the courts are likely to view the car as a gift to Carol from David. Therefore, he would not be entitled to have the car back (Bateman Television Ltd v Bateman).   

   

       

 

   

---