Beneficial ownership of house–Man in business on own account put house into mistress’s name to keep it out of reach of creditors–So be it, man cannot be heard to say house held by mistress on a resulting trust for him
This was a
claim by Mrs Thelma Cantor, of Northcote Road, Battersea, London SW, suing as
an executrix of Constance Myrtle Heaney deceased, against Mr Sidney Cox, of 34
Greenway Avenue, Walthamstow, London E13, for possession of those premises. The
defendant counterclaimed a declaration that he was beneficially entitled to the
freehold in the property, alternatively an inquiry as to the beneficial
interests vested respectively in himself and in the Heaney estate.
Mr R R F Scott
QC (instructed by Bennetts) appeared for the plaintiff, and Mr W D Ainger
(instructed by Cartwright, Cunningham, Haselgrove & Co) represented the
defendant. The plaintiff’s co-executrix, Mrs Sheila Doreen Reeve, was joined as
a nominal defendant but took no part in the proceedings.
Giving
judgment, PLOWMAN V-C said that the late Mrs Constance Heaney (‘the testatrix’)
was divorced by her husband in 1950. Mr Cox was co-respondent. After the
divorce the testatrix and the defendant lived together until her death on
August 31 1971. They never married. From 1953 onwards they lived in a house, 34
Greenway Avenue, which was purchased in that year in the sole name of the
testatrix for £2,350. The action concerned the beneficial ownership of that
house. By her will, dated October 30 1970, the testatrix left all her property
to her niece, Mrs Cantor, to Mrs Cantor’s two children, and to another niece,
Mrs Reeve. The house was valued for probate at £8,000, and it was the only item
of any value in the testatrix’s estate. After her death another will was found
which was made out on a printed will form and dated July 17 1971. By it the
testatrix gave the house to the defendant, expressing the wish that he would
leave it to Mrs Cantor and Mrs Reeve after his death. That will was invalid,
since it was not executed in accordance with section 9 of the Wills Act 1937.
But nevertheless the defendant had remained in occupation and claimed to be
entitled to do so as the sole beneficial owner. His case was that he provided
all the money required to acquire the house in the first instance and all the
money required to pay off the mortgage. He said, through his counsel, that
there was no presumption of advancement to operate in the testatrix’s favour
and that she therefore held the property on a resulting trust for him.
Mr Scott, for
the plaintiff, submitted that in this day and age the presumption of
advancement ought to be extended to persons living together as husband and wife
in the same way as if they were lawful husband and wife. But it was unnecessary
for him (his Lordship) to decide that point, because even if the defendant’s premises
were right the conclusion by no means followed. Here the legal estate was in
the testatrix, and the defendant came to the court seeking equitable relief.
The equitable presumption of a resulting trust which arose where the
purchase-money was provided by someone other than the person taking the legal
estate was always rebuttable by evidence of actual intention. The evidence in
this case was perfectly plain. The defendant put the house into the name of the
testatrix in order to be out of reach of his creditors. This was candidly
admitted by the defendant in the witness-box. He said, in relation to the 1953
purchase: ‘I was in business on my own account. I was always afraid of going
bankrupt, and I always wanted to be sure of a roof over our heads.’ He added that he did not intend in 1953 to
give the testatrix no 34.
In his
(Plowman V-C’s) judgment, that evidence was enough to rebut the presumption of
a resulting trust which might otherwise have arisen in the defendant’s favour,
assuming, as he (his Lordship) did for the moment, that he provided the whole
of the purchase-money. To apply what Lord Denning said in the analogous case of
Tinker v Tinker [1970] P 136, the only way consistent with
honesty that the defendant could have ensured that the house would not be
available for his creditors was to give it–and that meant give it
beneficially–to the testatrix. He could not be heard in court to allege a
dishonest motive, for it was axiomatic that he who came to equity must come
with clean hands. And, in circumstances such as the present, Lord Eldon once
said: ‘Let the estate lie where it falls.’
Incidentally, it was alleged on behalf of the defendant in the
correspondence that the testatrix was well aware of his reason for putting the
house in her name. But there was no evidence whatever that this was so, and in
any case the point was irrelevant, as appeared from Gascoigne v Gascoigne
[1918] 1 KB 223. It followed that the plaintiff was entitled to succeed in this
action on the strength of the legal estate. The defendant’s evidence that he
made all the payments might be true, but it did not carry great conviction. If
he (his Lordship) were wrong about what he might call the Tinker v Tinker
point, he would conclude that on the balance of probabilities both parties made
contributions to the purchase. If it had been necessary for him to fix the
shares, he thought that rough justice would have been done by holding them to
be equal.
The plaintiff
was granted an order for possession of the property within an agreed period of
three months. She was also granted an order for delivery-up of the deeds and
documents of title, and a further order for mesne profits in respect of the
defendant’s occupation since January 30 1972, when a letter was said to have
been written asking for delivery-up. A set-off was ordered in favour of the
defendant for a sum of £353 paid out for central heating and a further sum of
£1,290 paid by him in part satisfaction of the mortgage debt.
