Ronan Hughes & Anor v R

Paying for a house built on another person’s land does not itself create an equitable or proprietary interest in the house or land. A common intention constructive trust requires an actual shared intention, objectively deduced from the parties’ words and conduct. Proprietary estoppel requires an actual promise or assurance by the legal owner. An estoppel equity does not automatically produce a proprietary remedy; relief may instead be a personal right of occupation or a monetary award. Where the evidence does not support the necessary findings, a confiscation order based on the alleged interest must be quashed. The appellate court may remit the confiscation proceedings for a fresh hearing under the Criminal Appeal Act 1968 and the Proceeds of Crime Act 2002.

Ronan Hughes pleaded guilty to 39 offences of manslaughter and conspiring to assist unlawful immigration. The Central Criminal Court later conducted confiscation proceedings under the Proceeds of Crime Act 2002. The Recorder found that Mr Hughes had a valuable equitable interest in a house built on land registered in the name of his mother, Catherine Hughes, and included approximately £150,000 in the available amount for confiscation.

Mr Hughes appealed against the confiscation order. Mrs Hughes appealed against the determination of the extent of his interest in the property. The central issues were whether the evidence established a proprietary interest and whether the Court of Appeal could remit the matter for a fresh determination.

Appeals allowed. Leave was granted to both Mr Hughes and Mrs Hughes. The confiscation order was quashed and the matter was remitted to the Crown Court for a fresh hearing.

1. Under Irish and English land law, a house built on land becomes part of the land and belongs in law to the landowner. It cannot be separated from the land and sold alone. Payment for construction does not, without more, create an equitable interest.
2. A common intention constructive trust requires an actual shared intention between the registered owner and the claimant that the claimant should have a beneficial interest. The intention may be deduced objectively from words and conduct, but the trust cannot simply be imposed as a judicial solution: Jones v Kernott [2012] 1AC 776.
3. Proprietary estoppel requires an actual promise or assurance by the legal owner. The evidence did not show that the judge had found any such promise, assurance, agreement or shared intention. A bystander’s reaction to the circumstances could not supply that essential element. The same principle was reflected in Guest v Guest [2022] UKSC 27 and Thorner v Major [2009] 1 WLR 776.
4. An equity arising from proprietary estoppel does not determine the remedy. The court must fashion proportionate relief. That may include transfer of land, a monetary award, or a personal right to remain in occupation which is neither transmissible nor saleable. The Recorder therefore misused Inwards v Baker [1965] 2 QB 29.
5. For confiscation purposes, the available amount requires identification of the free property in which the defendant has an interest and calculation of its market value. The evidence below was insufficient to establish that Mr Hughes had a proprietary interest.
6. A defendant may challenge a section 10A determination as part of an appeal against the confiscation order under section 9 of the Criminal Appeal Act 1968. A person with an interest in the property may also appeal under section 31(4) of the Proceeds of Crime Act 2002.
7. The wide power under section 32(2A) of the 2002 Act includes power to remit the matter to the Crown Court for rehearing. The reasoning in R v Pawelski [2023] EWCA Crim 653 was compelling. The power was distinguished from the power under section 32(1), which was held in Barnet LBC v Kamyab [2021] EWCA Crim 543 not to include remittal.

The Crown Court was directed to consider Mrs Hughes’s claim as part of the fresh determination and to ensure that any new confiscation order was no more severe than the order quashed.

• Court of Appeal (Criminal Division): Both appeals allowed. The confiscation order was quashed and the matter was remitted to the Crown Court for a fresh determination.
• Central Criminal Court: The Recorder found that the applicant had a valuable equitable interest in the Irish property, included approximately £150,000 in the available amount, and made a confiscation order of £182,078.90.