Property law

The matter of whether a contractual license is a proprietary right was again examined in Binions v Evans. In this case however Lord Denning gave a dissenting judgment but remained in line with his Errington approach.  Binions, the landlord, bought a house from the Tredegar Estate. He new, that there was a special arrangement, whereby Mrs. Evans, a widow whose husband had been an employee of the Tredegar till his death , could live there for the rest of her life, rent free. That was the reason Binions paid a reduced price for the house. However, later Binions decided to turn Mrs Evans out, saying that she was a tenant at will and he could determine the tenancy. The other two judges found that the conveyance to Binions, for a reduced price created a life interest in favour of Mrs Evans which resulted in her becoming a life tenant under the Settled Land Act 1925 and that Binions took the land subject to that interest. Lord Denning did not want to go that far. Instead, in his descending judgment, found that Mrs Evans had an irrevocable contractual license which gave her an equitable interest in the land, not any sort of tenant. Alternatively he recognised in the facts a constructive trust under which her license would be protected.

The path opened by Lord Denning was followed  by other judges as well although some of them , as for example in Re Sharpe, felt uneasy as they considered that the field of contractual licenses and equitable interest arising there from was not fully explored. Ashburn Anstalt v. Arnold and Another  in 1989 put Lord Denning’s approach to the test. Errington and Binions were reviewed and it was found that the actual decisions were correct .However it was said that their finding that the contractual licences are binding on all potential purchasers except those who had no notice of their existence was per incuriam and wrong. Errington was therefore reduced into an estoppel case.  Ashburn Anstalt also considered the issue of the constructive trust found by Lord Denning in the Binions. It was decided that a constructive trust should be imposed but only when the purchaser expressly undertakes to give effect to a certain interest.

One therefore might argue that Lord Denning’s efforts and exploration went in vain however it seems that they contributed to the enactment of s1(1) of the Contracts (Rights of Third Parties) Act 1999 which solves problems like Binions and one may not call for the constructive trust approach any more.

 Lord Denning’s innovating role in residential occupation was further expressed in the field of property disputes between husband and wife over the house. Again in order to realise his impact it is necessary to go through the cases in a chronological sequence

It was in 1947, when in  the case of H v H Lord Denning came for the first time across a claim by a husband to recover  from his wife, whom he had  deserted, the possession of their ex matrimonial house in which she was leaving but the title of which it was his. Lord Denning saw the injustice and as he himself admits, without citing a single case but relying exclusively on principle decided that under common law the husband did not have a right to turn the wife out of the house and that therefore the court was entitled to invoke s.17 of the Married Women Property Act 1882. He then expanded and said that the said section allowed him to give an order as he thought fit.  Lord Denning applied this principle in other cases as well including Hine v. Hine. However, twenty-three years later the House of Lords in Pettitt v. Pettitt overturned it by saying that s.17 was only procedural and could not be used to effect changes on the respective legal rights

Almost simultaneously with H v H, Lord Denning invented for the wife a right in equity to remain in the husband’s house which she could even impose against the purchaser. Thus in Bendall v. Mc whirter the husband’s trustee in bankruptcy tried to evict the deserted wife from the husband’s house in order to sell it at a better price. Lord Denning decided that the wife had a right in equity to stay in the house and the trustee in bankruptcy took the house subject to that equity.

Many criticized him for this. A correspondent expressed his opposition to what L. Denning was doing, saying:

“Dear Sir: You are a disgrace to all mankind to let these women break up homes and expect us chaps to keep them while they rob us of what we have worked for and put us out on the street. I only hope you have the same trouble as us. So do us all a favour and take a Rolls and run off Beachy Head and don’t come back.” 

R.E Megarry criticized Bendall v. Mc whirter and wrote:

“Any protection for the wife should , it is suggested , be provided by statutory amendments of the matrimonial law operating on the recognised rights of property, rather than by what is( in effect, at all events) the judicial invention of a new proprietary right…”.

This criticism found willing ears in the House of Lords in the National Provincial Bank v. Hastings Car Mart Ltd.. In this case the husband, after deserting his wife, transferred the house to a company of his, mortgaged it to a Bank and failed to service the mortgage. The Bank which knew of the scheme tried to evict the wife so as to sell. At the Court of Appeal Lord Denning found that the wife has a licence coupled with an equity which can be enforced on any successor, with the exception of a purchaser for value without any notice and had a right to remain in the house until the court would order otherwise. The House of Lords rejected L. Denning’s approach. The deserted wife has no equitable right against anybody buying from the husband or receiving a charge from him. She has only a personal right against him to remain in the house so long as he is the owner.

On July 27th 1967, three years after the above decision of the House of Lords, the Parliament enacted the Matrimonial Homes Act 1967 whereby the wives are entitled to stay in the matrimonial home but in order to be protected against the purchaser they need to register under the Land Charges Act a “Class F” charge. Once again Lord Denning’s judicial innovation although criticized managed to result into just legislative changes.

        The co-ownership of a matrimonial house between a husband and wife has also difficulties. In Gurasz v. Gurasz Lord Denning found that the husband could be ordered out of the matrimonial house although he had legal title as co-owner. He stated:

 “Some features of family life are elemental in our society. One is that it is the husband’s duty to provide his wife with a roof over her head: and the children too. So long as the wife behaves herself, she is entitled to remain in the matrimonial home….that is a right which the courts, for the protection of the wife, can restrict: just as it can restrict his right if he were sole owner.” 

The co-ownership of a matrimonial house between a husband and wife has some difficulties when the two parties fail to state their beneficial interests of the property at the time they buy it. In the case of Rimmers v Rimmer L. Denning and his colleagues held that husband and wife intended to hold the house jointly and therefore they should divide equally the proceeds. L. Denning said, that as in Newgrosh v. Newgrosh and Jones v. Maynard, since 1882  wives were entitled to have property of their own and therefore, it the couple failed to make clear as “to whom the beneficial interest belongs then equality is equity”. 

        L. Denning confessed that in the case of Appleton v. Appleton he expressed himself too wide. The house in this case was on the wife’s name that turned her husband out of it and tried to sell it. The husband claimed a merit of the proceeds since he made some work on the house but it was rejected. The Court of Appeal (L. Denning was one of the judges) allowed the appeal. However, the House of Lords disagreed and decided that the improvements made by the husband in Appleton and Pettit case did not intent to affect the legal title of the house. Therefore the husbands got nothing. On the other hand the wives benefited from the improvement they did without spending any money.  

        The Court of Appeal a year later applied in Gissing v. Gissing.the wide approach applied in Pettitt. The House of Lords again overruled this decision. They relied on the law of trusts instead of s.17 of the 1882 Act as it is the “most fruitful trees in the orchard of English law.” Few days’ later, Gissing case was followed by L. Denning and his colleagues in Falconer v. Falconer. What the judicial decisions did establish is that a financial contribution, direct or indirect can be considered as a “share” of the house. A further problem arises when the husband is trying to sell or put the house on mortgage without informing his wife. Thus in Williams & Glyn’s Bank v. Boaland., Templeman J, in his judgment said that “when a mortgagor is in actual occupation of the matrimonial home, it cannot be said that his wife also is in occupation….” and emphasised that “Any other view would lead to chaos”. 

Denning argued that Templeman’s thesis is wrong as contradicting Hodgson v. Marks. He said that actual occupation is not a matter of law but a matter of fact and since the wife was in actual occupation the Bank could not turn her out. He concluded saying:

“We should protect the position of a wife who has a share- just as years ago we protected the deserted wife. In the hope that the House of Lords will not reverse us now as it did then”.

        Lord Denning’s quest of justice in a Don Quixotic way, as he himself implies, invited criticism and his major efforts were overruled by the House of Lords. However it was the very spirit of his judgments which moved the Parliament to improve the law related to the topics discussed in this essay.

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