Most cases concerning rectification for common mistake relate to commercial contracts. But the question that arose in Ralph v Ralph [2021] EWCA Civ 1106; [2021] PLSCS 135 was whether a Land Registry form TR1, signed by the transferors, but not by the transferees, should be rectified to remove a manuscript cross from the box stating that “the transferees are to hold the property on trust for themselves as tenants in common in equal shares”.
The trial judge took the view that neither of the transferees had ever intended that they should be joint owners in equity. They were father and son – and the son was a party to the purchase in 2000 because his father could not obtain a mortgage advance on his income alone. He did not contribute to the purchase price, or to the mortgage repayments, and it was wholly improbable that his father was gifting half of the property to him – thereby excluding any interest which his siblings or their mother might otherwise have in that share and giving him an immediate right to an occupation rent from his parents. It followed that the son did not have any beneficial interest in the property, which was held for his father alone.
The High Court disagreed. The transferees had not discussed how the property should be held and there was no common intention or expression of any accord. So it was not appropriate to vary the declaration in the TR1 to say that the property was held on trust for the father alone, because that was never agreed. However, it would be appropriate to rectify the TR1 by deleting the manuscript cross from the box on the form, leaving no express declaration of trust at all.
The Court of Appeal reached a completely different conclusion. The Master of the Rolls, Sir Geoffrey Vos, who delivered the judgment, explained that the law does not make contracts for people unless they have agreed to them or shown a continuing common intention as to the term or terms in issue. An accord could include understandings that were so obvious as to go without saying, or that were reached without being spelled out in so many words. But the transferees had not given any thought to the matter at all.
Had the question been raised, the father would have said “this is for my family” and the son – who was being lumbered with legal liability under a mortgage that would prevent him buying a house of his own – would have said: “I want a share”. But what that share might be was unclear. And the trial judge did not make any finding that he was happy to have the same share as his siblings. It followed that it was impossible to find a sufficient, or any, continuing common intention. Consequently, the court was unable to rectify the form.
Interestingly, neither party suggested that the principles that are applicable to the rectification of commercial contracts should not apply to declarations of trust where family members are buying property jointly. So the court proceeded on the assumption that these principles did apply to the form TR1. But Sir Geoffrey Vos suggested that the point should be left open in case it should arise in the future, given that cases like this have features that distinguish them from a commercial context.
Allyson Colby is a property law consultant
