Lloyd Dorian Williams v Gerwyn Lloyd Williams & Ors

Where land is acquired in joint names for business purposes, equity normally presumes that the beneficial ownership is held in equal shares as a tenancy in common, without survivorship. The presumption may be displaced by sufficiently unusual circumstances showing an intention to hold jointly, but equal contributions or joint borrowing do not by themselves establish beneficial joint tenancy. The general starting point remains that beneficial ownership follows the legal ownership, with the burden on the person asserting otherwise. In a business context, however, the inference of beneficial joint tenancy is materially weaker because legal co-owners must hold the legal title jointly, while equity readily presumes that business property is held in common.

The claimant appealed against a declaration that Cefn Coed Farm had been acquired by him and his parents as beneficial tenants in common in equal shares. The farm had been transferred into their joint names without an express declaration of trust. It was acquired while the three were business partners, financed entirely by a mortgage, and used for the farming enterprise.

The High Court dismissed the claimant’s wider claims concerning partnership assets and proprietary estoppel and held that the farm was held in common. The appeal concerned only the beneficial form of co-ownership: whether the principles in Stack v Dowden and Jones v Kernott required a starting presumption of beneficial joint tenancy, or whether the business purpose of the acquisition justified a tenancy in common.

1. Appeal dismissed. The declaration that Cefn Coed was held by the claimant and his parents as beneficial tenants in common in equal shares was upheld.
2. The general proposition that beneficial ownership follows legal ownership, and that the burden lies on the person asserting a different beneficial ownership, is not confined to domestic cases. It is nevertheless only the starting point. The context of the acquisition must be considered.
3. Stack v Dowden and Jones v Kernott were concerned with homes acquired by cohabiting couples. Their guidance, including the presumption of beneficial joint tenancy, was closely connected with that domestic and intimate relationship. Those decisions did not undermine the established equitable principle that co-owners acquiring property for business purposes are normally presumed to hold it as tenants in common.
4. That principle applies whether or not the property is formally a partnership asset, and whether or not there is a formal partnership. It reflects equity’s reluctance to attribute survivorship to property acquired for a joint undertaking carried on for profit. The presumption may be displaced by unusual circumstances, but the circumstances must be sufficiently strong to show an intention that survivorship should apply.
5. The farm was acquired as a commercial decision for the benefit of the farming business. The parties’ equal co-ownership, joint mortgage and equal partnership interests did not establish an intention of beneficial joint tenancy. The mortgage documents and the expression “as Beneficial Owner” did not address the distinction between joint tenancy and tenancy in common. The parents’ earlier wills supported the finding, although the business purpose alone was sufficient.
6. The trial judge’s evaluative conclusion was open to him on the evidence and disclosed no appealable error. The Court of Appeal therefore dismissed the appeal.

• Court of Appeal (Civil Division): [2024] EWCA Civ 42 — appeal dismissed.
• High Court of Justice, Business and Property Courts in Wales, Property, Trusts and Probate List (ChD): [2022] EWHC 1717 (Ch) — declaration that Cefn Coed was held as beneficial tenants in common in equal shares.