Arogundade v Arogundade

Where a person contributes directly or indirectly to the purchase price of property acquired in another person’s sole name, the contribution may give rise to a resulting trust. In the absence of a different arrangement, the beneficial interests are proportionate to the parties’ respective contributions. The court must determine the contributions by evaluating the evidence as a whole, including documentary evidence and the reliability of witnesses. Unsupported assertions and reconstructed records may be rejected, while cultural and commercial practices should not be assessed solely by reference to English expectations.

The claimant and defendant were the registered proprietors and beneficial-interest participants in dispute concerning a leasehold flat bought in the defendant’s sole name. The claimant had registered a caution, asserting that she had contributed approximately £120,000 towards the purchase price. Following an objection to cancellation, HM Land Registry directed her to commence Chancery Division proceedings.

The claimant sought declarations concerning the beneficial ownership of the flat and consequential orders. The central issue was whether, and to what extent, she had contributed to the purchase. Issues concerning the parties’ Nigerian matrimonial status were excluded from determination.

1. The claimant’s claim succeeded. The court declared that she was entitled to a 30 per cent beneficial interest in the flat and reserved consequential directions for further consideration.
2. The applicable principle was that, if the claimant had contributed towards the purchase price, the defendant held the property on a resulting trust for both parties in proportion to their respective contributions: Bull v Bull [1955] 1 QB 234, at p 237, and Lloyds Bank v Rosset [1991] 1 AC 107, at p 133A.
3. The court assessed the evidence in its cultural and commercial context. The parties’ Nigerian background, the passage of time and the possibility of misunderstanding required caution in assessing demeanour and inconsistencies. English assumptions about banking and business practices could not automatically be applied.
4. The claimant’s evidence contained substantial exaggerations and inaccuracies, and several cheque counterfoils appeared to have been annotated retrospectively. Nevertheless, the evidence established that she had made material contributions. The court accepted a contribution of £18,500 arising from the Assaro loan, £34,500 in cash paid to Mr Sodiende, and £9,000 represented by the cheque to West Coast Shipping Lines Ltd.
5. The total acquisition cost, including associated fees, was assessed at approximately £207,000. The claimant’s contribution of £62,000 therefore represented approximately 30 per cent. The court emphasised that undocumented financial transactions carried evidential risks, but did not draw further conclusions about the defendant’s reasons for using cash transactions.