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Resulting and Constructive Trust in Equity & Trust - Case Study Example

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Resulting and Constructive Trust in Equity & Trust

She also, throughout the relationship, looked after the children and performed all the usual domestic duties around the home.
In Sept 2003, Lynn formed a liaison with another man and moved out of the house. She brought an action against Mike claiming that she was entitled to a half-share in the house by reason of her contributions to the house hold expenses during the period the parties lived together. According to the evidence at the trial in the High Court, both Lynn and Mike had assumed that the house was jointly owned although the matter was never actually discussed between them. It is also not in dispute that, if it had not been for the fact that Lynn was working part-time, Mike would not have been able to meet the mortgage payments out of his own salary.
1) Applying Lloyds Bank plc v Rosset (1994) 1 A.C. 107, (HL), in the absence of any finding of an agreement, arrangement or understanding between the parties to share beneficially, Lynn's indirect contributions to household expenses were insufficient to found a beneficial interest in the house. In particular, the court refused to follow the decision of Mr. Nicholas Mostyn Q.C. (sitting as a deputy High judge) in Le v Le Foe (2002) 2 F.L.R. 970on the ground that it was inconsistent with Lord Bridge's speech in Rosset;
2) Distinguishing Midlands Bank Plc v Cooke (1995) 4 All E.R. 562 (C.A.), it was not open to the court to assess Glady's beneficial share in the house by undertaking a survey of the whole course of dealings between the parties relevant to their ownership and occupation of the property. The principle enunciated in Cooke applied only to the establishment of an equitable interest through direct contributions.
In December 2004, the Court of Appeal dismissed Lynn's appeal affirming both grounds given by the High Court.

Task:
Lynn now wishes to appeal to the House of Lords against the Court of Appeal's decision and seeks your written opinion on the merits of her claim. You should support your advice by reference to decided cases.

Answer:
The current state of caselaw on implied trust and beneficial or equitable interest in property due to indirect contributions to family home is not favourable to the appeal being considered by Lynn Jones. English courts are reluctant to adopt the remedial constructive trust principles of Canadian courts.
It seems to be that judicial reasoning on implied trust rely on contributions to the purchase price and provable agreement, arrangement or understanding between the parties to share the property beneficially prevent the application of principles of justice and conscience in the present case. The facts of the problem show that the court had already struck down Lynn Jones arguments on the application of resulting trust principles because of the lack of contribution to the purchase price or proof of agreement, arrangement or understanding to share equitable interest. Not only the Rosset and Cooke cases but also the basic direction of ...Show more

Summary

Lynn Jones and Mike Smith are an unmarried couple. They met in 1990 and decided to set up home together. In the same year, Mike purchased a house in his sole name, the purchase money coming from his divorce settlement and by way of a mortgage. At Mike's invitation, Lynn Moved into the house shortly after completion of the purchase.
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Resulting and Constructive Trust in Equity & Trust essay example
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