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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Carlton v Goodman [2002] EWCA Civ 545 (29th April, 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/545.html Cite as: [2002] 2 FLR 259, [2002] EWCA Civ 545

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Carlton v Goodman [2002] EWCA Civ 545 (29th April, 2002)

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
(MR PETER LEAVER QC)

		Royal Courts of Justice Strand, London, WC2A 2LL
		29th April 2002

Lord Justice Mummery :

1. This is an appeal from the decision of Mr Peter Leaver QC, sitting as a Deputy Judge of the Chancery Division on 29 June 2001. He made an order on the application of Mr Jerry Goodman (Jerry), acting as administrator of the estate of his late father, Mr Brian Goodman (Mr Goodman), declaring that the defendant, Mrs Anita Carlton (Anita), holds the property known as 13 Zenoria Street, East Dulwich, London SE 22 (the House) upon trust for the estate of Mr Goodman absolutely. He ordered Anita to transfer the House to Jerry as such administrator upon terms that, simultaneously with the transfer, Jerry would procure the discharge of the mortgage in favour of Alliance & Leicester plc (the Mortgage). It was provided that, if Jerry was unable to provide the funds for the discharge of the Mortgage, Anita should use her best endeavours to obtain the agreement of Alliance & Leicester plc to the transfer of the House to Jerry, upon terms that Anita be released from all further liability under the Mortgage. Anita was ordered to give vacant possession of the House on or before 28 September 2001.
2. Anita appeals to this court with the permission of Robert Walker LJ. The appeal raises an interesting point on resulting trusts in a case where the purchase of property acquired for the sole use and occupation of one party is partly financed by a joint mortgage on the property. Anita now accepts that the House was held by Mr Goodman and her on a resulting trust. She does not appeal against the Deputy Judge’s rejection of (a) her claim that the House was held by Mr Goodman and her as beneficial joint tenants, so as to pass to her by survivorship on the death of Mr Goodman; and (b) her claim that the House was held upon a constructive trust for Mr Goodman and her in equal shares in consequence of her having acted to her detriment in reliance on an express agreement or an implied common intention.
3. The dispute is whether Anita has any beneficial interest under the resulting trust. On the one hand, Anita contends that the resulting trust was for herself and Mr Goodman in unequal shares arising from the contribution she made towards the purchase of the House, such contribution not being an actual cash payment to the purchase price, but a deemed contribution by reason of her having executed the Mortgage over the House as security for a loan raised to pay a substantial part of the purchase price. On the other hand, Jerry contends that the resulting trust was, as the Deputy Judge held, for Mr Goodman absolutely.

The Facts

4. Mr Goodman originally lived in the House as a tenant of a Mrs Croft from about 1989. For part of that time his daughter, Joanna, and his son, Jerry, also lived there with him. Anita, with whom Mr Goodman had a relationship from about 1984 until his death on 5 October 1997, never lived with Mr Goodman in the House or anywhere else. She was unmarried, lived at home with her parents in Tooting and worked at the Commonwealth Secretariat. Mr Goodman’s two earlier marriages were over long before the relationship with Anita began. He was considerably older than Anita. He was not in good health. He had a heart attack in 1984 and suffered from asthma. But he held down a variety of jobs at the Streatham Ice Rink, as a part time computer consultant and as a caller and floor manager in bingo halls.
5. In 1993 Mrs Croft decided to retire and move out of London. Mr Goodman thought that it was a good idea to buy the House from her. So did Anita. There were negotiations between Mrs Croft and Mr Goodman. The price was agreed at £50,000. The sale was at a reduced price, as Mr Goodman was a sitting tenant. The open market value was then between £78,000 and £90,000. The House is now on the market for £257,000.
6. In September 1993 Mr Goodman contacted a solicitor, Mr Donald Bailey. He told him that he was buying the House in his own name for £50,000 and would be getting a mortgage through the Legal & General. On 18 November 1993 Mr Goodman informed Mr Bailey that he did not have sufficient income to finance a mortgage by himself and that he would be buying the House with Anita as co-mortgagee. It was proposed to obtain the mortgage through the Halifax. In November and December 1993 Mr Goodman and Anita signed Mortgage Application Forms with property and personal details. They were addressed to the Alliance & Leicester. Mr Goodman filled in the forms. Anita left everything to do with the mortgage, the solicitors and the payment of legal costs to him. She had no contact with the solicitors at any time. She just signed what he asked her to sign without reading the documents.
7. On 9 February 1994 Mr Goodman informed Mr Bailey that he and Anita were expecting to receive a mortgage offer of £47,000 on a joint income of £25,000.
8. On 13 September 1994 Mr Goodman sent a personal cheque for £2,500 to the solicitors in respect of the 5% deposit. Anita made no contribution to the deposit. On 16 September Mr Goodman returned the contract for the purchase of the House signed by him and Anita. On 26 September 1994 contracts for the purchase of the House were exchanged. The House was transferred into the joint names of Mr Goodman and Anita. Completion took place on 10 October 1994. The House was registered in their joint names at HM Land Registry on 13 October 1994. There was no express declaration of the beneficial interests in the House, either in the Transfer or in any other document. The Deputy Judge found that prior to the purchase there was no discussion between Mr Goodman and Anita or with the solicitors about their respective beneficial interests in the House and there was no agreement about those interests.
9. The Mortgage Deed was signed by both Mr Goodman and Anita. At the time of the purchase Mr Goodman told Anita that she would “come off” the mortgage after a year. Her evidence was that she believed that that would happen. Mr Goodman made all the mortgage interest repayments and paid all the premiums on an endowment policy out of his own money. Anita made no contribution to the payments of mortgage interest during Mr Goodman’s lifetime.
10. On 2 October 1995 Mr Goodman contacted the solicitors and asked them to obtain the consent of the building society to the transfer of the House into his sole name. The request was made and the building society sent a form for the Transfer of the Equity, but nothing further was done. In March 1997 Mr Goodman asked the solicitors to assist him in the transfer of the House into his sole name. The matter did not progress.
11. On 5 October 1997 Mr Goodman died intestate. On 27 May 1998 Jerry obtained Letters of Administration to the estate. In 1999 Anita got married. She and her husband-to-be had already moved into the House. They have spent money on it and they have made mortgage repayments and insurance payments. They continued to live there until they moved out at the end of September 2001.

The Judgment

12. After a detailed review of the evidence the Deputy Judge made clear findings of fact, as summarised above, and he considered the relevant authorities cited to him. His conclusion in paragraph 46 was that:

“In my judgment, therefore, the house is held by Anita on resulting trust for the Claimant, as Administrator of the Estate of Mr Goodman. I reach this conclusion as a result of the evidence, in particular, that Mr Goodman made all the payments in respect of the mortgage and the endowment policy and that Anita made none, and of the fact that there is no evidence of any agreement, understanding or common intention that the beneficial ownership of the house was to be jointly held, or of Anita acting to her detriment or altering her position in reliance on any agreement with Mr Goodman.”

Appellant’s Submissions

13. In his succinct and forceful submissions on behalf of Anita, Mr Grant Crawford argued that (a) since both Mr Goodman and Anita covenanted with the Alliance & Leicester to repay the loan of £47,500 used to fund the bulk of the purchase price, and (b) in the absence of any agreement that Mr Goodman should indemnify Anita or be treated as primarily liable under the Mortgage, the Deputy Judge should have held that Mr Goodman and Anita each contributed one half of £47,500 to the purchase price, and that each was beneficially entitled in undivided shares under a resulting trust. The Deputy Judge had ignored the contribution made by Anita to the purchase price in the form of one half of the sum raised on the joint Mortgage on the strength of the total income of both of them. If the intention of the parties was that Anita should not have a beneficial interest, this could have been achieved by the simple expedient of her joining in as guarantor of the loan, instead of as joint owner and mortgagee of the House.
14. Mr Crawford relied on a passage at p. 321 of Underhill’s Law Relating to Trusts and Trustees (15^th Ed by Professor David Hayton) as stating the applicable legal principle:

“Because A and B have legal title any mortgage moneys will be a joint and several liability, so giving A and B joint or equal shares in the proportion of the property purchased with the mortgage moneys unless A and B have agreed that one of them undertakes all mortgage liability or, say, 75% of liability under the mortgage, when the “undertaker” will acquire an equitable interest under a resulting trust in the proportion that the amount of his liability bears to the acquisition cost of the property.”

15. He submitted that the crucial point was that there was no evidence that Mr Goodman had ever communicated to Anita an intention to assume sole liability under the Mortgage and to exonerate her from her joint and several liability under it. In those circumstances it was impossible to infer an agreement by Mr Goodman to that effect. Anita’s continuing liability under the Mortgage constituted a contribution to the purchase price, so as to give her a beneficial interest in the House. If she had not joined in the Mortgage, Mr Goodman could not have bought the House, as his income was insufficient. Her joinder was required by the building society for the making of the advance needed to pay for the House. If Mr Goodman had fallen into arrears with the mortgage payments, she would have been liable to pay them.

The Authorities

16. In the cases cited for the proposition in Underhill, Huntingford v. Hobbs [1993] 1 FLR 736 and Springette v. Defoe (1992) 65 P & CR 1, the issue for decision was the size of the beneficial interests in property jointly acquired, without any express declaration of the beneficial trusts, for the parties to live in together as a family unit. The dispute was whether the beneficial interests should be equal or in some other proportion. So in Huntingford v. Hobbs the man did not contribute directly to the purchase price, but the arrangement as between the two of them was that he should make all the payments due under the mortgage executed by each of them on the joint property and under the endowment policy. It was held that the proper common intention to impute to the parties, as at the date of the purchase, was that the woman should be treated as having contributed her cash contribution and that man should be treated as having contributed the whole of the sum borrowed on mortgage and that the property should be owned by them in shares proportionate to such contributions. As Sir Christopher Slade said at p. 744C

“There is no dispute that when the property was placed in joint names, the two parties intended that they should each have a beneficial interest in it. The difficulty lies in establishing the extent of those beneficial interests in the absence of any declaration of trust.”

17. He went on to hold that the respective beneficial interests fall to be determined by reference to trust law principles, which concentrate on how the purchase money was provided. The general principle was as stated by Dillon LJ in Walker v. Hall [1984] FLR 126 at p.133:

“….[I]t has been consistently held that where the purchase money for property acquired by two or more persons in their joint names has been provided by those persons in unequal amounts, they will be beneficially entitled as between themselves in the proportions in which they provided the purchase money.”

18. The problem posed in Huntingford v. Hobbs was that part of the money required had been borrowed on mortgage. Sir Christopher Slade held that the proper approach was that stated by Vinelott J in Re Gorman [1990] 2 FLR 284 at p.291

“ In circumstances of this kind, the court is concerned to ascertain, so far as is possible, from the evidence, what was the intention of the parties when the property was purchased, or what intention is to be imputed to them. Prima facie, if the purchase is financed in whole or in part on mortgage, the person who assumed liability for the mortgage payments, as between the joint owners, is to be treated as having contributed the mortgage monies.”

19. Sir Christopher Slade held that it was necessary to draw from the conduct of the parties, including subsequent conduct, the most likely inference of common intention, at the date of the purchase, as to the manner in which the mortgage payments were to be provided for. That depended on the facts of the particular case. In that case, while both parties had to join in the mortgage and assume joint and several liability to the lender, there was a clear agreement or understanding that, as between the two of them, the man would pay all the mortgage interest and endowment policy premiums and it was not contemplated that the woman would have to pay anything towards the discharge of that liability.
20. Mr Crawford submitted that, applying that approach to this case, a substantial part of the purchase price for the House was paid from money borrowed on the security of the House by both parties as joint owners; and there was no clear agreement or communicated intention that Mr Goodman would pay all the mortgage interest payments and the endowment policy premiums and exonerate Anita from her liability under the mortgage. He also cited Springette v. Defoe for the proposition that a common intention as to the proportions of the beneficial interests could only be established if it were a shared intention communicated between them. In that case there had been no discussion between the parties as to their respective beneficial interests. So no common intention as to the proportions of the beneficial interests could be established. The same was true of this case. The Deputy Judge held that there was no discussion between Mr Goodman and Anita about the beneficial interests. The consequence was that the parties held the House upon a resulting trust in the proportions to which they contributed to the purchase price. Anita’s proportion was determined by reference to one half of the money advanced on the security of the Mortgage, while Mr Goodman’s contribution, in addition to the other half of the advance, was determined by reference to the amount of the deposit and the amount of the discount on the purchase price attributable to his position as sitting tenant of the House.

Resulting Trusts

21. In all the above cases there was either an admitted or a clearly established common intention shared by the parties that they should each have a beneficial interest in the property jointly acquired to live in together. The dispute before the court was about the proportions. The cases held that, in determining the respective proportions of their beneficial interests, account had to be taken of their common intention as to the discharge of the joint mortgage: whether they would share the repayments or whether one of them would assume sole liability for the repayments.
22. The main question raised by Mr Grant Crawford’s submissions is whether the execution of a joint mortgage on jointly held property acquired for the sole use and occupation of one of them constituted the making of a contribution to the purchase price of the property, so as to entitle each party in all the circumstances, to a corresponding beneficial interest under a resulting trust of the property. In order to answer that question I turn to the fundamental principles described from over 200 years of case law (including the above cases) and apply them to the facts of this case.

i) The consequence of the transfer of the House by Mrs Croft into the joint names of Mr Goodman and Anita was that the legal estate was vested in them as trustees.

ii) As there was no express declaration of the trusts of the beneficial interests, either in the Transfer or in any other document, it is necessary to ascertain whether beneficial interests have been created in an informal way allowed by equity, such as a resulting, implied or constructive trust, which are expressly recognised in, and exempted from statutory formalities by, section 53(2) Law of Property Act 1925. The only claim now made by Anita is under a resulting trust.

iii) The beneficial interests under a resulting trust are ascertained by the process of identifying the person who provided the purchase money to acquire the property and, if more than one person is identified as having done so, by ascertaining the respective amounts provided. As held in Dyer v. Dyer (1788) 2 Cox 92 at p. 93, “the trust of a legal estate results to the man who advances the purchase-money…It is the established doctrine of a Court of equity, that this resulting trust may be rebutted by circumstances in evidence.” See also Walker v. Hall quoted in paragraph 17 above.

iv) There is no dispute that only Mr Goodman directly provided purchase money for the House in the form of the £2,500 deposit paid out of his own resources. It is not disputed that only he contributed added value to the acquisition of the House in the form of the discounted purchase price solely attributable to his personal status as a sitting tenant (see Springette v. Defoe.)

v) Anita made no direct payment of the purchase price of the House. She claims contribution in the form of the liabilities undertaken by her in the Mortgage, which was jointly entered into in order to fund payment of a substantial part of the purchase price. In principle, I see no reason why such an arrangement cannot be treated as a contribution to the payment of the purchase price of property capable of giving rise to a resulting trust : see Calverley v.Green (1984) 155 CLR 242 at 257-258 and 276-268

vi) However, as observed by Laws LJ in the course of argument, the role in fact played by Anita was a different and lesser one than that of a contributor to the purchase price. She facilitated the purchase of the House by lending her name in order to secure the advance from the Alliance & Leicester. She thereby assisted Mr Goodman in his purchase of the House. But that form of assistance was not, on the facts found by the judge, a contribution by her, or intended to be a contribution by her, to the purchase price of the House so as to give rise to a resulting trust in her favour.

vii) The fact is that Anita paid nothing towards the purchase price, and it was never intended, as between Mr Goodman and her, that she should pay anything at all. Her involvement in the purchase was so circumscribed and temporary that it cannot fairly be described as a contribution to the purchase price, entitling her to an enduring beneficial interest in the House. She only became involved after Mr Goodman found that he could not obtain a mortgage on his own in order to purchase the House as his home. On her own evidence the understanding was that she would “come off” the mortgage after a year. The fact that she remained potentially liable to the Alliance & Leicester on the covenant in the mortgage does not assist her claim to a beneficial interest. What has to be considered is her contribution, as between Mr Goodman and her, to the purchase price in the circumstances at the date of acquisition of the House. If she made no contribution at that time, subsequent enforcement of the covenant against her by the Alliance & Leicester would not be a contribution to the purchase price. It would be a contribution to the discharge of the mortgage liabilities.

viii) Nor could the making of such mortgage payments be relied on as a circumstance rebutting the resulting trust to Mr Goodman as sole contributor to the purchase price. The position is that, as a trustee, she would be entitled to be indemnified out of the trust property for any expenses, such as mortgage repayments, incurred by her in respect of the trust property. She would not acquire a beneficial interest in the trust property simply as a result of making mortgage repayments to the building society.

ix) There were no other circumstances rebutting the presumption of resulting trust in favour of Mr Goodman, such as purchasing the House as a family home for them both to live in, or discussions between the parties leading to an agreement, arrangement or understanding between them that the beneficial interests in the House were to be shared, or conduct from which an inference could be drawn that there was a common intention that Anita was to be given a beneficial interest in the House.

The Resulting Trust Debate

23. A valuable debate on the true nature of resulting trusts, on their proper classification and on their role in reversing unjust enrichment has been stimulated by an excellent monograph on the subject by Dr Robert Chambers (Resulting Trusts-1997). The debate is mentioned by Lord Millett in his speech in Twinsectra Limited v. Yardley &Ors [2002] 2 WLR 802 at p. 827 paragraphs 92-95 and the rival theories are discussed in Vol 1 of English Private Law (Ed. Professor Peter Birks) paragraphs 4.249-4.256. It does not appear to me, however, that the rival theories lead to different outcomes in this case.
24. As Lord Millett said in Twinsectra at paragraph 92-

“… the central thesis of Dr Chambers’s book is that a resulting trust arises whenever there is a transfer of property in circumstances in which the transferor (or more accurately the person at whose expense the property was provided) did not intend to benefit the recipient. It responds to the absence of an intention on the part of the transferor to pass the entire beneficial interest, not to a positive intention to retain it.”

25. On the facts found by the Deputy Judge, Mr Goodman was the person at whose expense the House was provided. He paid all the deposit. The discount in the price was solely referable to him as sitting tenant. He was to pay (and did in fact pay) all the mortgage payments and all the premiums on the endowment policy. There was no intention that the transfer of the House into joint names should confer a beneficial interest on Anita. It was part of the arrangements undertaken to acquire the House for his sole use, occupation and benefit. Anita’s participation was intended only to be a temporary involvement on the basis of the limited understanding between them. A resulting trust arose by operation of law for the sole benefit of Mr Goodman.
26. If, however, Dr Chambers’s thesis is not adopted and resulting trusts are approached on the alternative theory (as stated in, for example, Westdeutsche Landesbank v. Islington LBC [1996] AC 669 at 708C-D per Lord Browne-Wilkinson) of trusts giving effect to a common intention of the parties, the right inference from all the primary facts found by the judge was that there was a common intention on the part of Mr Goodman and Anita that they should hold the House on trust solely for the benefit of Mr Goodman, and not on trust for the benefit of each of them.

Result

27. I would dismiss the appeal.

Lord Justice Laws

28. I agree that this appeal must be dismissed. Whether the court must consider the intention of the person at whose expense the property was provided – here Mr Goodman – or the common intention of the parties – Mr Goodman and Anita – it is entirely obvious on the facts that there was no intention whatever to confer any beneficial interest on Anita.

Lord Justice Ward

29. I am grateful to counsel for their concise submissions which they concluded in a morning and which give rise to a deceptively short issue: is Anita to be treated as having contributed one-half of the monies borrowed from the Building Society for which she and Mr Goodman were jointly and severally liable and if so does the doctrine of resulting trust operate so that the beneficial interest in the property is held for her in the proportion that her contribution of that half of the mortgage loan stands to his contribution of the other half, his payment of the deposit and the value of the discount he gained as sitting tenant. I say the issue was deceptively simple because it did not address many of the controversies which bedevil this area of the law. For example, Peter Gibson L.J. began his judgment in Drake v Whipp, The Times, December 19^th 1995, Court of Appeal transcript for 30^th November 1995:-

“Yet again this court is asked to rule on a dispute between a man and a woman, who cohabited but were not married to each other, as to their respective beneficial interests in a property which they purchased to be their home but which was put into the man’s name only. The usual lengthy litany of authorities as well as more recent additions have been recited to us and, as is notorious, it is not easy to reconcile every judicial utterance in this well-travelled area of the law. A potent source of confusion, to my mind, has been the suggestion that it matters not whether the terminology used is that of the constructive trust, to which the intention, actual or imputed, of the parties is crucial, or that of the resulting trust which operates as a presumed intention of the contributing party in the absence of rebutting evidence of actual intention. I therefore like Waite L.J. in Midland Bank v Cook [1995] 4 All ER 562 at pp.564, 5 welcome the announcement earlier this year that the Law Commission is to examine the property rights of home sharers (Item 8, 6^th Programme of Law Reform: Law Com. No. 234.”

30. Waite L.J. had said:-

“The economic and social significance of home-ownership in modern society, and the frequency with which cases involving disputes as to the property rights of home-sharers (married or unmarried) are coming before the courts, suggest that the Law Commission’s intervention is well-timed and has the potential to save a lot of human heartache as well as public expense.”

31. I am told the Law Commission may release their report later this year.
32. Midland Bank v Cook itself can only be properly understood when it is appreciated that the court was satisfied that by the making of a direct contribution a resulting trust had been established in the wife’s favour of some part of the beneficial interest and the real question for the court in that case was to determine what proportions the parties must have been assumed to have intended for their beneficial ownership.
33. The source of confusion between the constructive trust and the resulting trust to which Peter Gibson L.J. referred may be as potent as ever in view of Lord Browne-Wilkinson’s suggestion in Westdeutsche Bank v Islington L.B.C. [1996] AC 669, 708 C-D that:-

“Both types of resulting trust are traditionally regarded as examples of trusts giving effect to the common intention of the parties.”

34. Lord Millett may not agree. In his paper Restitution and Constructive Trusts (1988) 114 L.Q.R. 399, 401 he would regard it as important, as Peter Gibson L.J. also seems to think, that it is the absence of an intention to benefit the recipient not the presence of an intention to create a trust in favour of himself that is the determinative factor. He draws support from Doctor Chambers’ work on Resulting Trusts. Nicola Glover and Paul Todd even write of The Myth of Common Intention in 1996 L.S. 325.
35. We have not heard sufficient argument to become embroiled in, still less to resolve these confusions. Indeed I have probably added to them already. I believe, however, the case can be resolved totally satisfactorily by authority which binds us.
36. I start with Pettitt v Pettitt [1970] AC 777. Lord Upjohn said at pp. 813-4 that:-

“... The rights of the parties must be judged on the general principles applicable in any court of law when considering questions of title to property, and though the parties are husband and wife these questions of title must be decided by the principles of law applicable to the settlement of claims being those not so related, while making full allowances in view of that relationship.

In the first place, the beneficial ownership of the property in question must depend upon the agreement of the parties determined at the time of its acquisition. If the property in question is land there must be some lease or conveyance which shows how it was acquired...

But the document may be silent as to the beneficial title. The property may be conveyed into the name of one or other or into the names of both spouses jointly in which case parol evidence is admissible as to the beneficial ownership that was intended by them at the time of acquisition and if, as very frequently happens as between husband and wife, such evidence is not forthcoming, the court may be able to draw an inference as to their intentions from their conduct. If there is no such available evidence then what are called the presumptions come into play. They have been criticised as being out of touch with the realities of today but when properly understood and properly applied to the circumstances of today I remain of opinion that they remain as useful as ever in solving questions of title.

First, then, in the absence of all other evidence, if the property is conveyed into the name of one spouse at law that will operate to convey also the beneficial interest and if conveyed to the spouses jointly that operates to convey the beneficial interest to the spouses jointly, i.e. with benefit of survivorship, but it is seldom that this will be determinative. It is far more likely to be solved by the doctrine of resulting trust, namely, that in the absence of evidence to the contrary if the property be conveyed into the name of a stranger he will hold it as trustee for the person putting up the purchase money and if the purchase money has been provided by two or more persons the property is held for those persons in proportion to the purchase money that they have provided.

My Lords, all this is trite law but I make no apology for citing the judgment of Eyre C.B. in 1788 in the leading case of Dyer v Dyer (1788) 2 Cox, Eq Cas 92, 93, 94 set out in full in White and Tudor’s Leading Cases in Equity 9^th Ed. (1928), Vol. 2, 749 –

“The clear result of all the cases, without a single exception, is that the trust of a legal estate, whether freehold, copyhold or leasehold; whether taken in the names of the purchasers and others jointly, or in the names of others without that of the purchaser; whether in one name or several; whether jointly or successive – results to the man who advances the purchase-money. That is the general proposition, supported by all the cases, and there is nothing to contradict it; and it goes on a strict analogy to the rule of the common law, that where a feoffement is made without consideration, the use results to the feoffor. It is the established doctrine of a Court of Equity, that this resulting trust may be rebutted by circumstances in evidence.

The cases go one step further, and prove that the circumstance of one or more of the nominees being a child or children of the purchaser, is to operate by rebutting the resulting trust; and it has been determined in so many cases that the nominee being a child shall have such operation as a circumstance of evidence, that we should be disturbing land-marks if we suffered either of these propositions to be called in question, namely, that such circumstance shall rebut the resulting trust, and that it shall do so as a circumstance of evidence.

The remarks of Eyre C.B. in relation to a child being a nominee are equally applicable to the case where the wife is the nominee. Though normally referred to as a presumption of advancement, it is no more than a circumstance of evidence which may rebut the presumption of resulting trust, and the learned editors of White and Tudor were careful to remind their readers at p.763 that “all resulting trusts which arise simply from equitable presumptions, may be rebutted by parol evidence ...”

... these presumptions or circumstances of evidence are readily rebutted by comparatively slight evidence ...”

37. Next I move to Westdeutsche Bank where Lord Browne-Wilkinson said at p.708A:-

“Under existing law a resulting trust arises in two sets of circumstances: (A) 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 contribution. It is important to stress that this is only a presumption, which presumption is easily rebutted either by the counter-presumption of advancement or by direct evidence of A’s intention to make an outright transfer: see Underhill and Hayton, Law of Trust and Trustees pp.317 et seq.; Vandervell v Inland Revenue Commission [1967] 2 AC 291, 312 et seq. In Re Vandervell’s Trusts (No. 2) [1974] Ch 269, 288 et seq. (B) Where A transfers property to B on express trust but the trusts declared do not exhaust the whole beneficial interest: ibid. and Quistclose Investments Ltd. v Rolls Razor Ltd. (In Liquidation) [1970] AC 567.”

38. The resulting trust for which Mr Crawford contends is a type A resulting trust. Although I did not at first accept it, it seems to me that there is force in his submission that the purchase price of this property i.e. the consideration paid by the joint purchasers to the vendor must be seen to be made up of the sum of £2,500, the deposit paid by Mr Goodman and £47,500 paid by them jointly. The legal consequence of their borrowing is that as between the two of them they were equally liable and so the loan should also be equally allocated between them as a contribution of a half of the amount borrowed by each of them. There is, therefore, a presumption of a resulting trust to Mr Goodman in respect of his half of the loan (and the deposit and – it seems common ground – the value of the discount) and a resulting trust in favour of Anita in respect of her half of the borrowing. The issue is whether that presumption is rebutted.
39. For assistance in answering that question I turn to Vandervell v Inland Revenue Commissioners [1967] 2 AC 291 where Lord Upjohn again set out the general principles at p.312:-

“Where A transfers, or directs a trustee for him to transfer, the legal estate in property to be otherwise than for valuable consideration it is a question of intention of A in making the transfer whether B was to take beneficially or on trust and, if the latter, on what trust. If, as a matter of construction of the document transferring the legal estate, it is possible to discern A’s intentions, that is an end of the matter and no extraneous evidence is admissible to correct or qualify his intentions so ascertained.

But if, as in this case (a common form share transfer), the document is silent, then there is said to arise a resulting trust in favour of A. But this is only a presumption and is easily rebutted. All the relevant facts and circumstances can be considered in order to ascertain A’s intentions with a view to rebutting this presumption.

As Lindley L.J. said in Standing v Bowring (1885) 31 Ch D 282, 289:-

Trusts are neither created nor implied by law to defeat the intention of donors or settlors; they are created or implied or are held to result in favour of donors or settlors in order to carry out and give effect to their true intentions, expressed or implied.”

The law was well stated by Mellish L.J. in Fowkes v Pascoe (1875) 10 Ch. App. 343, 352:

“Now, the Master of the Rolls appears to have thought that because the presumption that it was a trust and not a gift must prevail if there was no evidence to rebut the presumption, therefore when there was evidence to rebut the presumption he ought not to consider the probability or improbability of the circumstance of the case, and whether the presumption was really true or not, but ought to decide the case on the ground that the evidence of Pascoe and his wife taken alone was not satisfactory. But, in my opinion, when there is once evidence to rebut the presumption, the court is put in the same position as a jury would be, and then we cannot give such influence to the presumption in point of law as to disregard the circumstances of the investment, and to say that neither the circumstances nor the evidence are sufficient to rebut the presumption.

James L.J. in the same case also pointed out in effect that it was really a jury matter, on the basis, I may add, of weighing the evidence on the balance of probabilities.”

40. I like jury questions. They are much easier to answer than arcane questions of the exact nature of resulting trusts. Here the facts lead to only one conclusion. Looking at the matter first from his point of view, this had been Mr Goodman’s home for years. He wanted to take advantage of his landlady’s desire to sell to acquire the property for himself. He did not intend Anita to benefit. She did not live with him. She used to visit and they had a relationship but he did not intend to share either the use of the property or the title to it with her. There was no question of his making a gift to her of any part of the property which was being acquired through the contribution he was making to its acquisition. His true intention was that the property would be his and only his. The resulting trust in his favour arising out of the contributions he made is certainly not rebutted.
41. Looking at the matter from her perspective, one has to start as one did with Mr Goodman, with a resulting trust arising from her contribution of half the joint loan. But she was in a very different position. She clearly had an affection for Mr Goodman and wished to assist him in his endeavours. If it meant putting her name to the borrowing and to the mortgage, then so be it. She did not really think about it. She did not really care about it. She trusted him. Mr Goodman told her she would “come off” the mortgage in a year, and she believed that that would happen. Her reaction then was that he should do what he wanted to do. She would not be making the mortgage interest repayments nor did she. She would not be making payments of the premium to service the insurance policy on his life (not theirs) which would pay off the borrowing on his death nor did she. The inference is irresistible that as between the two of them the arrangement was that he would be responsible for those payments and that she would not be responsible for any of them. She put her name to the mortgage deed but as between the two of them she had no intention of being responsible for the repayment. She had every expectation that it was his sole responsibility. Putting the matter colloquially she was saying “I am doing this for your”. Putting the matter loosely, and looking at the actuality not to the strict legal straightjacket of contractual obligation arising from a joint loan, she was making a “gift” of her contribution to Mr Goodman. That rebuts the presumption of resulting trust which arose from her contribution of paying the loan money borrowed from the mortgagee.
42. If I have to impute a common intention to the parties, then those facts impel the conclusion that the common intention was that each of them was treating as Mr Goodman’s contribution to the purchase the whole of the monies borrowed since, as between them, he was making himself totally and entirely responsible for the repayment, and absolving her of any responsibility.
43. So, whatever the tortuous complications of law may be, the result on the facts is simple. There is no resulting trust in favour of Anita. Like my Lords, I too would dismiss the appeal.
44. I add only this. The conveyancer who acted for these parties thought at one time that she had discussed with Mr Goodman whether or not he wished to declare their beneficial interest in the conveyance and record that they held as joint tenants, the rules of survivorship having been explained to him. When she gave evidence she eventually concluded that she did not have any such discussion with Mr Goodman and the judge had no hesitation in concluding that no such discussion had taken place. It was common ground that Anita was not involved in any such discussion. I ask in despair how often this court has to remind conveyancers that they would save their clients a great deal of later difficulty if only they would sit the purchasers down, explain the difference between a joint tenancy and a tenancy in common, ascertain what they want and then expressly declare in the conveyance or transfer how the beneficial interest is to be held because that will be conclusive and save all argument. When are conveyancers going to do this as a matter of invariable standard practice? This court has urged that time after time. Perhaps conveyancers do not read the law reports. I will try one more time: ALWAYS TRY TO AGREE ON AND THEN RECORD HOW THE BENEFICIAL INTEREST IS TO BE HELD. It is not very difficult to do.

Order: appeal dismissed with costs, to be the subject of a detailed assessment on the standard basis if not agreed; determination of the amount which it is reasonable the appellant should pay in respect of such costs to be referred to a costs judge; respondent to be entitled to recover any sums paid by him on account of costs and not recovered from the appellant or any other person from the estate of Brian Morris Goodman; public funded costs assessment for the appellant.

(Order does not form part of the approved judgment)