'The law on constructive trusts of the family home generates unfairness, uncertainty
and hardship.' Discuss.
A constructive trust is implied by the court in situations where there is a common intention
between the landowner and the claimant that the claimant is to have an interest in
1
property, and the claimant has acted to his or her detriment in reliance on that agreement.
The court also considers whether it would be inequitable to allow the landowner to deny
2
the claimant a beneficial interest in his land. This means that a constructive trust prevents
the landowner from fraudulently relying on the absence of compliance with the formalities
3
of an express trust to claim the land for him or herself. A successful claimant is provided
4
with a beneficial interest in the land as an equitable co-owner.' Such claims are mainly
brought forth by cohabiting couples, as they are not protected under the Matrimonial
5
Causes Act 1973, which gives guidelines of how property is to be allocated if a married
6
couple got divorced or separated. Although the law on constructive trusts seems
straightforward at first glance, it has been criticised for generating hardship and for being
7
unfair and uncertain. In order to understand the basis of these criticisms, this essay will
examine the current law on constructive trusts and will consider how it has been applied in
various cases.
As mentioned above, a common intention between the parties is a vital ingredient of a
constructive trust. There are various routes which can be used to establish a common
8
intention. An example of such a method is an express understanding between the parties
9
that the property is to be shared beneficially. The finding of such an agreement is based
on the words used and discussions held, however imperfectly remembered and however
10
imprecise the terms may have been. This reveals the flexibility of the law on constructive
trusts, hence showing that it operates with the understanding that in the ordinary course of
1
Gissing v Gissing [1971] A.C 886 at 891 and 905
2
Ibid at 905 (Lord Diplock)
3
B McFarlane, NP Hopkins, SA Nield, Land Law: Text, cases and materials (3rd edn, OUP 2015) 361
4
Mark Davys, Land Law (9th edn, Palgrave Macmillan, 2015) Section 14.4
5
Matrimonial Causes Act 1973, s 24
6
Ibid
7
The Law Commission, Sharing Homes: A discussion paper ( 2002 page 40-41)
<http://www.lawcom.gov.uk/wp-content/uploads/2015/04/lc278.pdf> accessed 23 February 2016
8
Martin Dixon, Modern Land Law (9th edn, Routledge 2014) 179
9
Lloyds Bank Plc v Rosset [1991] 1 A.C. 107 at 127 (Lord Bridge)
10
Ibid at 132
and hardship.' Discuss.
A constructive trust is implied by the court in situations where there is a common intention
between the landowner and the claimant that the claimant is to have an interest in
1
property, and the claimant has acted to his or her detriment in reliance on that agreement.
The court also considers whether it would be inequitable to allow the landowner to deny
2
the claimant a beneficial interest in his land. This means that a constructive trust prevents
the landowner from fraudulently relying on the absence of compliance with the formalities
3
of an express trust to claim the land for him or herself. A successful claimant is provided
4
with a beneficial interest in the land as an equitable co-owner.' Such claims are mainly
brought forth by cohabiting couples, as they are not protected under the Matrimonial
5
Causes Act 1973, which gives guidelines of how property is to be allocated if a married
6
couple got divorced or separated. Although the law on constructive trusts seems
straightforward at first glance, it has been criticised for generating hardship and for being
7
unfair and uncertain. In order to understand the basis of these criticisms, this essay will
examine the current law on constructive trusts and will consider how it has been applied in
various cases.
As mentioned above, a common intention between the parties is a vital ingredient of a
constructive trust. There are various routes which can be used to establish a common
8
intention. An example of such a method is an express understanding between the parties
9
that the property is to be shared beneficially. The finding of such an agreement is based
on the words used and discussions held, however imperfectly remembered and however
10
imprecise the terms may have been. This reveals the flexibility of the law on constructive
trusts, hence showing that it operates with the understanding that in the ordinary course of
1
Gissing v Gissing [1971] A.C 886 at 891 and 905
2
Ibid at 905 (Lord Diplock)
3
B McFarlane, NP Hopkins, SA Nield, Land Law: Text, cases and materials (3rd edn, OUP 2015) 361
4
Mark Davys, Land Law (9th edn, Palgrave Macmillan, 2015) Section 14.4
5
Matrimonial Causes Act 1973, s 24
6
Ibid
7
The Law Commission, Sharing Homes: A discussion paper ( 2002 page 40-41)
<http://www.lawcom.gov.uk/wp-content/uploads/2015/04/lc278.pdf> accessed 23 February 2016
8
Martin Dixon, Modern Land Law (9th edn, Routledge 2014) 179
9
Lloyds Bank Plc v Rosset [1991] 1 A.C. 107 at 127 (Lord Bridge)
10
Ibid at 132
