Resulting trust and illegality

Teo Ai Hua (alias Teo Jimmy) v Teo Mui Mui ([2011] SGHC 81) is a Singaporean case. Two brothers and a sister contributed money towards the purchase price of a property. Title was in the sister’s name alone. The brothers contended that they were co-investors and that the sister held the property on resulting trust for the three of them. The sister contended that the brothers had made a loan to her. The Court preferred the brothers’ account and declared that the property was held on resulting trust. The sister also raised the defence of illegality alleging that it would have been illegal in Singapore for the second brother to have an interest in the property. This failed because, amongst other reasons, the brother did not need to plead his own illegal act to rely on the presumption of a resulting trust.

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