Essay Examples - Law Essays
British Property Law
Six years ago, Sally and Harry begin living together in Sally's rented flat. Shortly afterwards, Sally discoverers that she was pregnant. Harry then bought the freehold of a house, which was registered in his sole name. The purchase price of 140,000 was financed by Harry's savings and a mortgage loan.
Sally said that she wished that she could contribute to the purchase, but Harry told her, 'It doesn't matter that I'm paying for the house, but we'll say it's one third yours anyway'
The following year, Sally inherited 15,000 from a relative, which she paid over to Harry, saying 'this is for my share in my house'. Harry used the money to reduce the mortgage debt.
Over the last five years, Sally has done a considerable amount of work to the house. Apart from staying at home and looking after their daughter, Sally has redecorated and re-wired the entire house. She has also installed some more radiators and laid a patio in the back garden
Two years ago, Sally's mother Molly, came to live with them. Because the house was too small, Molly paid for an extension to be built, to provide a separate bedroom and bathroom for herself. The extension increased the value of the house by 30,000.
Relations between the parties have now become strained.
A) You are a trainee in the firm of solicitors consulted by Harry. Your principal has asked you to research and prepare a short report (1200 words) outline the legal principles as to what, if any, rights in the house may be claimed by either Sally or Molly and whether there are any particularly relevant cases.
The family home trust and actual possession rules were developed by English law in order to ensure that equity succeeded in cases of injustice as long as certain criteria were fulfilled. This section will explore the criteria and illustrate how this fits the clients Molly and Sally. This is a case where the property was conveyed into Sally's husband's name alone during the marriage, therefore creating the situation where this home fulfils the criteria of a family home, in addition to the fact that the law the husband and wife situation gives rise to a presumption of resulting trust, although the obiter of Pettit v Pettit of Lord Diplock expressed that this presumption is outdated. This opinion seems to be the case in respect to the Court of Appeal's judgement in respect to Sally's husband, because as this application will illustrate there is no relevant evidence to show that this presumption under the law can not be rebutted by Sally. Instead the Court of Appeal have created a discriminatory situation for Sally's husband in respect to his status as a husband and not allowing this appeal would be a breach of his human rights contained within the ECHR as incorporated by the HRA 1998 to a fair hearing Article 6(1) and discrimination under Article 14.
Sally's husband paid the whole purchase price of the matrimonial home, which illustrates that through the basic premise of a resulting trust that direct contributions, as Sally's husband made, should through equity create a resulting trust in the favour of the . Sally's husband provided the whole purchase money, which created a situation Sally's husband was the sole owner. However as Sally then contributed 15,000 to pay off part of the mortgage and increased the property value through re-decorating and re-wiring the couple should regarded as tenants in common with respect to the purchase money given; which is a classic case of Sally's husband holding the property in trust for her husband. The intention of Sally's husband when conveying the family home was to give his wife a beneficial interest of a third to his wife; however no trust was created as the formality required in a trust of land was not completed. Generally trusts can be created in any manner, because equity deals with the substance of the trust not its formal requirements. Therefore as long as the creator of the trust makes their intentions clear then a trust will be upheld by the courts. However a trust in land is a different situation whereby it must comply with the Law of Property Act 1925 section 53(b) and 53(c) for existing equitable interests in land whereby; a declaration of trust respecting any land or interest therein must be manifested and proved by writing.
Yet as Sally provided money to the mortgage and made major improvements then it is a matrimonial home trust. Therefore this intention fulfils the criteria of equity that a resulting trust should be presumed. The following case study will attempt to explain the importance of equity dealing with property law, especially in respect to those who do not hold property rights, socially and traditionally. Hence the reason for choosing women, because traditionally women never held property, in fact they were seen as property, at the worst, and akin to children, at the best, and equity became involved to ensure that women were protected under equity. In the modern era, women can own property and are seen as equal to men; however socially women still do not own property at the same scale as men and traditionally are the home and child carer and the financial contributions to the mortgage are usually be the husband, therefore equitable protection is very important in the case of marital break up. It must be noted that this notion can protect the husband, if in the weaker position; also there is possible indications that it is viable for common-law couples and possibly in the future the modern notion of same-sex couples.
Probert argues that both sides of the argument concerning the possible and inadequacies of the law of equity in relation to woman are deficient. Those who argue that the law of equity is deficient have not properly analyzed the situation and needs to be applied to modern situations and not the Burns v Burns case from 1961, she argues that there needs to be more than a discussion of the deficiencies of the resulting and constructive trusts. Probert further argues that the law did operate to the disadvantage of Mrs Burns who walked away with nothing after a 19-year relationship; but this is not a typical scenario of the modern cohabitant. Probert also illustrates that the argument that purports that there is no discrimination against women and modern co-habitants is lacking, because the only argument that they purport is that in the modern situation that the law does not discriminate against women only suggest that the greater participation of women in the workforce may have made a difference in the situation between men and women. Probert further argues that this line of argument is very deficient, because it provides no legal analysis and does not distinguish between cohabitating women and women, as a whole. Also she argues that the link between earnings and property ownership has not been conclusive, because returning to the Burns case, where Mrs Burns in 1961 was in paid employment but even though she financially contributed to the home, she did receive a beneficial interest in the home, as she was only a cohabitee.
This has become a very modern problem, because the nature of the family and the home is changing; however women traditionally are the non-legal owners of property and the titles are vested in the husband and either women are home-makers or juggle this with a very low paid job and their financial contributions are to children's clothing and housekeeping. Men, on the other hand, are the main contributors to mortgage and home improvement payments. In response to the deficiencies in the common law that was neglecting the situation that was a consequence when families split up because these women did not hold property rights. Lord Denning developed this to ensure that non-financial contributions to the home were recognized and the matrimonial constructive trust was created. However the House of Lords rejected this approach as encroaching on property and in rem rights, but did allow for a trust to be created if substantial contributions were submitted to the matrimonial home, e.g. mortgage payments and home improvements. However there was an outcry and protection was afforded to women statutorily; which creates the resulting trust of married couples once there have been substantial money/improvements to the family home.
In the case of Molly the rules of equity and actual possession are the key. Actual possession's definition stems out of the Boland Case where this case held that the term actual occupation should come from its ordinary meaning, which clarified that the only notice is the notice on the register. Problem with this term is that it could be applied to various situations, stemming, albeit not successfully, from; being physically in the property; the intention of moving in; being away on holiday; sleeping elsewhere but coming back to look after the children and do the household chores; to the storage of goods on unused and uninhabitable land. The case of Hypo-Mortgage Service v Robinson it was contended that minor children were in actual occupation; however the court rejected this view and held the children were only there because there parents were there. Williams & Glyn's Bank Ltd v Boland is a traditional situation of matrimonial home ownership, where the husband was the sole proprietor; however the wife had made substantial contributions to the home, which means that through equity create a resulting trust in the favour of the wife. In Abbey National Building Society v Cann where the property was bought with the intention that Cann's mother would live there; however Mr. Cann stated it was for sole occupation and registered a charge for a loan prior to his mother's occupation. However the initial intention of Mr. Cann was evident as he moved her furniture and carpets prior to the completion of the charge. The court held there was no occupier's right as Cann's mother was not in actual occupation until after the completion, as her holiday ended then. In Chhokar v Chhokar equal contribution to family home. The couple went on holiday and the husband deserted his wife and returned home. The court held that the wife was still in actual occupation and Mr Parmar has the conveyance of the house subject to Mrs Chhokar's overriding interest; holding half the interest in trust to her benefit. In Cheshire Homes the case held that uninhabited land with storage of goods in actual possession. This is applicable to whole area of law concerning overriding interests, except for the minor adjustments contained in the LRA 2002, which may be detrimental to possible beneficiaries and further helps protect lending facilities; therefore creating some uncertainty for subsequent buyers; whereby there will be tensions between the justice in respect to occupiers and prospective buyers; even though the LRA 2002 proposes to simplify and protect third party buyers and applies the situation of Cheshire Homes as the correct approach. Therefore as Molly is obviously in actual possession and she has contributed to the worth of the house, substantially the result would be a constructive trust in the home. Hence any sale of the property is not only subject to Sally's interests but Molly's also.
Back to: Essay Examples
The methodology that was taken that first of all basic textbooks in land law and equity were approached to lay out the development in respect to the matrimonial home trust (also known as the family home trust). An examination of the cases and their rational was explored starting from the pre-Denning cases up to the modern day. It is important to note that the case law in this area started off very narrow and then the Court of Appeal during Denning's time in the 1960's and 1970's started to broaden the basis that a family home trust could be awarded, the reason for the move away from the matrimonial home trust as terminology in this period and by feminists, such as Probert, is that matrimonial assumes that the normal family unit has to be an opposite sex married couple. In truth the 1960's and 70's saw culture changing with higher divorce rates, co-habitees and same sex couples that there needed to be a broader term, but not so broad to include mere associations. Therefore not only did the research on the subject have to consider the case law precedents, but the rationale for change. This is because in equity there is not necessarily a specific formula but the need to reach justice under certain conventions. Therefore this necessitated a consideration of the place of the weaker party in the home and the use of equity to create a situation of justice. Although the case law was narrowed back down by the House of Lords in Burns v Burns a basic principle was created if the individual contributed to mortgage payments, the purchase price or made substantial home improvements then the consequence was a resulting trust, as long as it was the individual's home regardless of whether it is a mother, child, friend, aunt etc. In addition the term of actual possession became an important area to research because this has changed over the years to a confusing topic but was clarified in the LRA 2002 that cleared up the confusion between the Cann Case and Chokar v Chokar with the Cheshire Homes approach to uphold the approach that occupation is any form of storage and does not necessitate living there. Therefore the study was primarily a case study approach, i.e. consulting the cases after identifying them out of the standard textbooks.
In addition to the basic textbooks and consulting law resources such as LexisNexis and Westlaw for case study reports, these electronic databases were used to search for journal articles on the family homes trust, constructive trusts, beneficial interest, the LRA 2002 and occupier's interests. In addition I made a search in the HMSO for the explanatory notes on the LRA 2002 in respect to occupier's interests in order to find out the appropriate precedent and approach to determining the avenue that the act is supposed to take in respect to occupiers interests.
The final act in the research was to do a web search on [1969] 2 All ER 385
More Free Law Essays...
Get free law essays from our extensive online resource library. Hundreds of example essays available from all the major essay topics to help you with your research...
Please note: The above essay was written by a student and then submitted to us to display and help others. Thanks to all the students who have submitted work to us.
