Weekly Review: 7th – 11th November

Constructive trust and proprietary estoppel

A licence for life can provide the basis for some type of assurance that cannot be revoked or ignored by the person who made it either on the basis of a constructive trust or proprietary estoppel. It can bind third parties who take with notice of the arrangement (Re Sharpe).

Common intention constructive trust: imputed intention: post-acquisition change of common intention

In England (where co-ownership of land gives rise to a statutory trust), when a co-habiting couple buy a family home in joint names but do not declare the nature of the co-ownership there is a presumption of a beneficial joint tenancy (thus, equal shares following severance (Stack v Dowden)). The presumption can be departed from if there is evidence to show either that they had a different common intention at the time of acquisition or that they subsequently reached a different common intention. The common intention is to be deduced objectively from the parties’ conduct (‘the whole course of dealing’). If (a) it is clear that the parties formed a different common intention either at the time of acquisition or subsequently, and (b) it is not possible to find an express or inferred agreeement (common intention) then the parties are entitled to the ‘share which the court considers just having regard to the whole course of dealing between them in relation to the property.’

Common intention constructive trust

Ha Yuet Chi v Yeung Yiu Keung is a District Court decision providing a recent example of an attempt by one joint tenant to argue for the existence of a share in the property on the basis of a common intention constructive trust.

Fiduciary duty

An application for an order for sale or the appointment of a receiver at an interlocutory stage of a claim by a beneficiary that the trustee had sold land forming part of the trust estate at an undervalue failed in Lam Sik Shi v Lam Sik Ying. The registration of a lis pendens was sufficient protection for the beneficiary.

Proprietary estoppel: incomplete contractual negotiations

Where contractual negotiations are incomplete and there is no assurance (independent of those negotiations) concerning an interest in property then there  is  no assurance for proprietary estoppel purposes. Where one party has enriched another (perhaps by providing services in the hope that the contract will be formed) there may be an award based on quantum meruit (A v B).

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