Curley v Parkes

A resulting trust arising on a purchase in one person’s name crystallises when the property is acquired. Subject to contrary intention, loan, gift or advancement, the beneficial interest reflects contributions to the purchase price. The registered owner is treated as contributing borrowed purchase money because of the liability assumed under the mortgage. Later mortgage instalments discharge that liability and are not purchase-money contributions. Payments made after completion count only if they discharge a liability to contribute to the purchase price which existed when the property was acquired. Ancillary expenses and removal costs may be relevant to a constructive trust, but do not ordinarily establish a resulting trust.

The claimant and defendant had cohabited in a property registered in the defendant’s sole name. After the claimant’s employer relocated him, the defendant sold that property and purchased another, also in her sole name. The claimant received relocation payments and later paid sums to the defendant and into a joint account.

The claimant claimed an equal beneficial interest, relying principally on an agreement or common intention giving rise to a constructive trust, and alternatively on a resulting trust based on contributions. The county court rejected the constructive trust case but did not address the resulting trust argument. The appeal concerned whether the alleged payments could establish a resulting trust.

1. Disposition. The appeal was dismissed, although the county court judge had erred by failing to address the alternative resulting trust submission. That omission did not justify remittal because the submission had no substance.
2. Applicable principle. A resulting trust of property purchased in one person’s name arises, absent contrary intention, at the date of acquisition. The beneficial interest corresponds to the proportion of the purchase money provided by the other party, subject to the contribution being neither a loan nor a gift and subject to the presumption of advancement. Where the registered owner borrows money for the purchase, that owner is treated as having provided the proportion attributable to the borrowing.
3. Mortgage payments. Later mortgage instalments are payments discharging the mortgagor’s obligations. They are not part of the purchase price already paid to the vendor and therefore do not create a resulting trust.
4. Claimed contributions. The £9,213 paid after completion was not shown to have been required by a liability existing when the property was acquired. The evidence also did not establish an agreement intended to have legal consequences. It could not count for a resulting trust.
5. The alleged payment of solicitors’ fees and expenses was not supported by sufficient findings, was likely made after acquisition, and was not part of the purchase price. Huntingford v Hobbs [1993] 1 FLR 736 involved a constructive trust and contained no discussion making it authority on resulting trusts. Marsh v von Sternberg [1986] 1 FLR 526 likewise concerned a constructive trust and did not assist on the different resulting trust question.
6. The removal costs plainly formed no part of the purchase price and could not give rise to a resulting trust. The appeal was dismissed with costs assessed at £3,900.

1. Court of Appeal (Civil Division): On 25 October 2004, dismissed the appeal and ordered costs of £3,900.
2. Northampton County Court: His Honour Judge Mayor QC, by order dated 7 January 2004, dismissed the claim to an equal beneficial interest and refused permission to appeal. The Court of Appeal held that he had failed to address the alternative resulting trust argument, but found that the omission did not affect the outcome.