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Resulting trusts

Result

Mr Brownsea purchased a property in the names of himself and Ms Malit in the hope that a relationship would eventuate.  It did not.  Mr Brownsea wanted the title to the property to vest solely in him, Ms Malit would not oblige.

There was no relationship in terms of the Property (Relationships) Act 1976 (the PRA) (if there was the presumption of resulting trust would be negated: PRA, s 10(S)).  Accordingly, there was not bar to proceedings being brought in the High Court.

A resulting trust arises at the time of the transaction, not as a result of subsequent behaviour.

As noted in Westdeutsche Landesbank Girozentrale v Islington London Borough Council:

“Where A makes a voluntary payment to B or pays (wholly or in part) for the purchase of property which is vested either in B alone or in the joint names of A and B, there is a presumption that A did not intend to make a gift to B; the money or property is held on trust for A (if he is the sole provider of the money) or in the case of a joint purchase by A and B in shares proportionate to their contributions. It is important to stress that this is only a presumption, which presumption is easily rebutted either by the counter-presumption or by direct evidence of A’s intention to make an outright transfer …”

The presumption referred to operates as a fist step, independent of evidential or factual enquiry.  See Fowkes v Pascoe

Where the presumption is made out, the property in question will result back to the person who paid for the property.

References:

  • Brownsea v Malit [2019] NZHC 1244
  • Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669
  • Fowkes v Pascoe (1875) LR 10 Ch App 343 at 353.

 

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