When do improvement works confer a proprietary interest?

In the absence of express agreement between the parties (or perhaps an estoppel), carrying out improvement works to the property of another does not give rise to a proprietary interest in the property. This is especially so where the works are ephemeral or relatively small in value.

Pettitt v Pettitt ([1970] AC 777, HL) has to be seen as part of a broader effort to establish the legal and equitable principles to be applied when deciding on the beneficial entitlements of spouses (or co-habiting couples) in the family home. In particular, it should be read together with Gissing v Gissing ([1971] AC 886, HL), Lloyds Bank plc v RossetĀ ([1991] 1 AC 107, HL) and later authorities in the same line. In Pettitt v Pettitt the matrimonial home had been paid for by the wife and title was in her name. When the marriage broke up, the husband claimed a beneficial interest by virtue of improvement works that he had carried out. The House of Lords was unanimous in concluding that he had no beneficial interest in the home. At least one of them (Lord Reid) would have allowed a claim had the works been more substantial.

Lord Upjohn embarked on a systematic effort to explain the legal and equitable principles that apply in this area. First, one should look for express agreement on the question of beneficial ownership. An express declaration as to legal and beneficial ownership is conclusive in the absence of fraud or mistake. If there is no express agreement as to beneficial ownership then parol evidence can be admitted or it may be possible to infer what the parties had agreed from their subsequent conduct. If the matter is still not settled then an intelligent application of the presumptions that the equitable title follows the legal title, of resulting trust and advancement might help. Lord Upjohn thought that spending money on someone else’s property did not confer any kind of proprietary interest in it but might give rise to a claim for monetary compensation.

Michael Lower

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