Notes

Module: LW2PLP Property Law Project
Assessed Written Work 2019-20
Title: Problem Question
Antonello and Malek
The issue between Antonello and Malek is whether Malek has any claim to the share of the property, despite the legal title of the home only being in Antonello’s name. The lack of Malek’s name on the Land Registry means that an ideal route to take in order for there to be an equitable result, the equitable remedy constructive trusts is relevant.
Constructive trust is where there is a lack of a declaration of trust, perhaps due to a trustee inducing another to act to their detriment, with belief that in acting to their detriment they will acquire beneficial interest to the land. The case of Stack v Dowden holds the presumption that where the legal title is held by a sole owner, then the beneficial interest will be held only by the sole owner, however this presumption can be rebutted by a constructive trust, where there is a common intention, whether expressed or inferred, to give beneficial interest to the other party. Express common intention is where there have been express discussions between the parties that shows that the property is to be shared beneficially. The case of Eves v Eves demonstrates an excuse used that can be interpreted as an express trust, this case had the defendant stating that the house was only conveyed to his name due to the claimant being too young. This can be argued to be an express agreement as this may show his intent to do so, furthermore her contribution in the form of laborious work on the property meant that there was entitlement to beneficial interest. In contrast, inferred common intention is where there is an absence of an express agreement, a common intention may be found from the conduct of the parties. In the case of Lloyds Bank v Rosset , the sole registered proprietor and only financial contributor defaulted on payments, leading Mrs Rosset to have no entitlement to stay in the property as there was no evidence for shared beneficial interest.
In this case, we can take into account the outcome of Rosset due to its single legal owner rule; a lack of similarity can be found in comparison as in Rosset there was no substantial contributions given, whereas Ms Malek has contributed £100,000 into the house, along with agreeing to pay half of the mortgage. Therefore, we can follow the outcome of Grant v Edwards (express agreement that demonstrated sharing the property and thus giving beneficial interest), the fact that Mr Antonello became the single legal owner because of the fear of Ms Malek’s ex-husband ‘getting his hands on the property’ can amount to an express agreement. Furthermore, with the aforementioned case of Lloyds Bank v Rosset , Lord Bridge sets out his opinion on the matter, “First, how does the court determine whether a claimant has acquired a beneficial interest in real property where there has been no financial contribution by the claimant?” This statement from Lord Bridge emphasises the need for a form of contribution; albeit implying that only contributions of money would suffice, and thus would be too narrow, which would lead to a resulting trust and therefore lead to other case law and stray from the primary focus of constructive trust. This contribution stated by Lord Bridge is shown in this scenario in Ms Malek’s heavy contribution in mortgage instalments, thus supporting her case.
In conclusion, Ms Malek can get back the money that she invested in as she was induced to act to her detriment (in the form of paying significant sums of money towards the house) and thus entitle her to beneficial interest in the land. It would seem that she will likely get 50% of the share on the basis of her promised payment of half the mortgage.
Malek and the new residents
The issue between Malek and the new residents is that as the house was sold to the couples Young and Ainsley, this was done without Malek’s knowledge. Furthermore, Malek is not on the register for owner of the land. This raises the issue of overriding interests, as prioritised in S.29 (2)(a)(ii) Land Registration Act 2002.
The categories on overriding interests is that if there is actual occupation, obvious on a reasonable inspection, and overreaching. The category most relevant to the family home is actual occupation, Williams & Glyn’s Bank v Boland had a case where there was a beneficial interest due to actual occupation, as the spouse was physically living in the house, which in turn meant that despite legal ownership of the other spouse, there is an overriding interest in the property. The case Chhokar v Chhokar entails a wife temporarily leaving the home, the end result leading to the rule of law that temporary absence does not matter. In the case of Malory v Cheshire Homes , there was physical presence in the form of the erected fences and boarded windows to indicate a sign of permanence and continuity, thus actual occupation.
In application to the scenario, the fact that Ms Malek took a 6 month trip to Australia can show similarities to the case of Chhokar v Chokkar , as despite the trip being quite a long time, there is a clear indication that she will return and her absence is temporary, much like the defendant in the Chhokar case. Therefore, meaning there is potentially overriding interest for Ms Malek. In addition to this, it could be argued that the case of Malory v Cheshire Homes shows that perhaps a degree of permanence and physical presence is required. This applies to the scenario as Ms Malek’s large collection of romance novels shows a physical presence, which puts into question if the couple should have made a more careful inspection; although, it can also be argued that what more careful inspection can they do other than search the Land Registry, which will show the sole owner being Antonello. It would be too harsh to criticise the couple on their lack of careful inspection, as we should not assume for them to realise the living situation with Antonello’s former partner (Malek) being one of beneficial interest. This goes hand in hand with the common law concept of the ‘bona fide purchaser’, where the innocent party who purchases the property does not receive a notice of any other party’s claim to the title of that property. Therefore, the bona fide purchaser will take valid title to the property despite the competing claims of the other party. Furthermore, the case of Stockholm Finance Ltd v Garden Holdings Inc indicates that presence must be more than fleeting, as the claimant’s continued absence of the house (which lasted for over a year) could not constitute occupation. This is of course different from a trip to Australia, which seems more temporary and bound to return, however the long length of time Ms Malek took on the trip (6 months) could raise an argument perhaps following the judgment of Stockholm Finance.
In conclusion, it is unlikely that she can get her home back as Schedule 3, para.2 (c)(i) of the Land Registration Act 2002 states that an interest which belongs to a person whose occupation would not have been obvious on a reasonably careful inspection of the land at the time of the disposition, will not lead to the interest of a person in actual occupation to override, which it very much seems the couple have faced, as there was little clear signs of indications aside from old photos of Antonello’s former partner and her collection of books, which can be argued to not hold too strong of a physical presence. In addition, the bona fide purchaser rule has made it clear that it will almost certainly lead to the legal title being held on to the new resident couple rather than Malek’s. Claiming back the money she invested into the property would be the option most assured to succeed.
What if they were married?
The issue upon marriage is that it can give different outcomes as there is an element of reliance. Perhaps the addition of a pre-nuptial agreement may lead to a clear split in interest if formerly agreed upon.
Section 24 (1)(b) of the Matrimonial Causes Act 1973 states that “an order that a settlement of such property as may be so specified, being property to which a party to the marriage is so entitled, be made to the satisfaction of the court for the benefit of the other party to the marriage and of the children of the family or either or any of them”. This indicates to us that if there will be children, it is expected that they take priority and will therefore be entitled to the settlement of the property, along with the parent that cares for them, which is more likely to be the mother.
In application to the scenario, we can look at the case White v White , despite it lacking a dependant child (the former couple’s offspring was now an adult), there was a recognition the non-financial contribution of the parent caring for the child, focusing on ensuring an ‘absence of discrimination’ albeit the case had too much of an excess in wealth that there was an absence of financial need. In regards to the scenario, we can identify that there too seems to be a lack in financial need too, so the aim will focus primarily on ensuring the money invested in the property by Ms Malek to be returned. Perhaps, in a situation where Ms Malek did in fact have a dependant child, she would have more claim to the total wealth than she invested into the property, but the lack of a reliant figure and her comfortable economic status (as indicated by the inheritance money) means that it will be less likely she will receive more money.
In conclusion, nothing significant enough changes, unless of course Ms Malek and Mr Antonello had an offspring that was reliant on them.