Bindra v Chopra

A trust deed should, where its language permits, be interpreted so as to give effect to all its provisions. A survivorship clause may validly create cross-remainders following life interests and is not necessarily testamentary or an invalid restraint on alienation. Rectification requires convincing evidence of a continuing common intention, outwardly expressed, that the document should have different terms. A common-intention constructive trust requires the intention of all legal owners. Under section 37 of the Matrimonial Proceedings and Property Act 1970, only substantial contributions to improvements can generate an enlarged beneficial interest. Proprietary estoppel cannot bind a legal owner without knowledge, agency or another sufficient legal basis.

The claimant and the defendant were respectively the sister and widow of the deceased, who had been the claimant’s co-owner of two properties. The proceedings concerned the beneficial ownership of 80 Ridge Lane, the proceeds of its sale, the defendant’s alleged contributions and expectations, and the estate’s entitlement to proceeds from the sale of 43 Melrose Place.

The claimant relied on a trust deed providing for unequal beneficial shares during the parties’ joint lives and entitlement of the survivor if either died before sale. The defendant sought rectification and alternatively claimed interests through constructive trust, proprietary estoppel and section 37 of the Matrimonial Proceedings and Property Act 1970. She also sought an inquiry and account concerning Melrose Place.

1. Ridge Lane trust deed. Clause 4 was legally valid and operated according to its terms. The deed was interpreted as giving Akash and Angela interests during their joint lives or until an earlier sale, with the survivor taking the whole beneficial interest if one died before sale. This construction gave effect to the deed as a whole and did not impose an impermissible restraint on alienation. Clause 4 was not testamentary because it was part of an irrevocable inter vivos trust arrangement and operated as a cross-remainder. The court therefore rejected the arguments based on repugnancy and the formalities of the Wills Act 1837.
2. Rectification. The defendant bore the burden of proving, on the balance of probabilities by convincing evidence, a continuing common intention that clause 4 should be absent, together with an outward expression of that prior accord. That burden was not discharged. The evidence instead showed that the parties intended the Ridge Lane deed to reproduce the survivorship provisions used for an earlier property.
3. Alternative claims. The constructive-trust claim failed because the relevant common intention had to be that of all legal owners, and there was no evidential basis for attributing such an intention to Angela. The claim under section 37 failed because the contributions were not sufficiently substantial and, in any event, any interest acquired in Akash’s beneficial interest could last only during his life. Proprietary estoppel failed for lack of Angela’s knowledge, agency or other legal basis for binding her, and on the facts there was no sufficient detrimental reliance.
4. Other relief. Occupation after termination of the licence was trespass, giving rise to damages measured by the ordinary letting value. The defendant was entitled to an inquiry and account concerning the Melrose Place proceeds. The inquiry was to proceed on the basis that Angela and Akash were equally beneficially entitled.

First-instance judgment in the High Court (Chancery Division). No prior appellate decision is stated in the judgment.