Chapter 6 Flowcharts with Audio

In this audio I want to talk you through the flow chart on how to determine how interest in the family home is analysed. Start by asking yourself, is there an express declaration of trust? If there is then that will be conclusive as to how the property is held; that’s the authority of Goodman v Gallant.

If there's no express declaration of trust, you need to ask: what is the context in which the purchase--the property--was purchased? Was it purely domestic, a mixed domestic investment context, or a purely commercial or investment context? In a purely commercial or investment context, resulting trust analysis will apply. Under the authority of Laskar v Laskar, this means that equitable interest will be determined by reference to the financial contributions the parties have made.

Where there is a purely domestic or family home context, we apply the common intention constructive trust and we need to subdivide our analysis here between sole legal owner cases and joint legal owner cases. In sole legal owner cases, Lloyds Bank v Rosset tells us that the claimant must prove they actually have an interest in the property, because of course their name is not on the title. They can do this under one of two routes. Route one: express bargain plus detrimental reliance. Or route two: implied bargain plus detrimental reliance.

Where there is a joint legal owner case, the case of Stack v Dowden tells us that the starting point is a heavy presumption of an equitable joint tenancy. That means a heavy presumption of 50/50 in equity. This presumption is rebuttable, however, but is also evidence of an intention to share other than equally. If that presumption is rebutted, the court then moves to quantify that equitable interest.

Equally, in a sole name case, if the claimant has proved they have an interest in the property, you move to quantification. And quantification, the principles on quantification, are the same for sole legal owner and joint legal owner cases, and there are those set out in Jones v Kernott.

The court will look for its express intentions of the parties as to the equitable share. If not, they'll move to attempt to infer intentions as to shares. And finally, if they cannot infer, or find expressed intentions, the court will impute intentions to the parties.

What about if there's a mixed context domestic investment? Well, the Privy Council in Marr v Collie said, in this mixed context, either the Stack v Dowden approach or the resulting trust analysis in Laskar could apply. Neither approach is barred where there is a mixed context, said the Privy Council.

Which approach will be adopted depends very much on a close reading of the factual nexus at play. But just be aware that neither the CICT, the Common Intention Constructive Trust, nor the resulting trust analysis is barred. Either approach could be taken depending on the specific facts of the case.