Crown Prosecution Service v Benye

Where one former partner contributes money towards the purchase of property acquired under a right-to-buy scheme, the contribution does not automatically confer a beneficial interest. The court must determine the parties’ common intention from the evidence and the whole circumstances. A contribution may have been intended as a gift, particularly where the parties’ relationship had ended and the transaction was arranged and financed in the other party’s sole name. An admission made in related confiscation proceedings may be given limited weight where it was made in circumstances creating a strong incentive to avoid a larger confiscation order.

The Crown Prosecution Service applied for a declaration that a leasehold flat acquired in Stella Benye’s sole name was beneficially owned by Anthony Benye, and for a receivership order under section 77(8) of the Criminal Justice Act 1988. The CPS relied on payments made by Mr Benye, his admission during confiscation proceedings that the leasehold was his, and evidence concerning the parties’ relationship and the source of funds.

Mrs Benye maintained that she was the sole beneficial owner. The central issue was whether Mr Benye’s payments represented an investment giving him an interest, or a temporary loan or gift made to enable Mrs Benye to acquire the property.

1. The CPS application failed. The court was not satisfied that Mr Benye had any beneficial interest in the Valentine Court flat.

2. Mr Benye’s agreement during confiscation proceedings that he owned the leasehold was entitled to some weight, but not substantial weight. It had been made when he faced the possibility of a much larger confiscation order and therefore had to be assessed against the incentive to identify an asset and limit the proceedings.

3. The evidence supported the conclusion that Mr and Mrs Benye’s relationship had ended following their divorce in 2001. The alleged electoral-register entry was unsupported by documentary evidence and could not establish residence or a continuing relationship.

4. Mrs Benye had lied about the alleged Nigerian land sale which she relied on to explain two cash deposits totalling £18,000. The court inferred that the money came from Mr Benye. That finding did not, however, determine the beneficial ownership of the property.

5. The court considered the relevant question to be the parties’ joint intention when the money was transferred. It was implausible that the transfers were intended to enable Mr Benye to acquire the sole beneficial interest. Mrs Benye had held the tenancy, exercised the right to buy, arranged the mortgage in her sole name and made the mortgage payments.

6. Although Mr Benye had provided the £18,000, the more probable inference was that he intended to make a gift for the benefit of Mrs Benye and the children. The court rejected the contention that he acquired an interest proportionate to his contribution or that the law should confer such an interest in the circumstances.

7. The £26,969.36 paid from Mr Benye’s account in November 2003 was consistent with temporary finance, because Mrs Benye repaid £27,000 eight days later. The earlier transfer to Hartnells was also capable of being a genuine mistake and did not establish that Mr Benye directed the transaction.

Consequential orders were left to agreement or determination on the papers.

The judgment does not state an appellate history. It records earlier confiscation proceedings before Southwark Crown Court, but the present application was determined at first instance in the Administrative Court.