(1)References to a person disposing of his property include a reference—
(a)to his disposing of a part of it, or
(b)to his granting an interest in it,
(or to both); and references to the property disposed of are to any property obtained on the disposal.
(2)A person who makes a payment to another is to be treated as making a disposal of his property to the other, whatever form the payment takes.
(3)Where a person’s property passes to another under a will or intestacy or by operation of law, it is to be treated as disposed of by him to the other.
(4)A person is only to be treated as having obtained his property for value in a case where he gave unexecuted consideration if the consideration has become executed consideration.
Cases considering section 314 4
[2012] EWHC 2737 (QB) · 10 October 2012Interprets
Interprets executed consideration as requiring performance of all contractual promises forming the consideration. Partial performance does not satisfy the provision where the consideration is indivisible. (see paras [26]-[30], [36]-[37])
[2010] EWHC 353 (QB) · 2 March 2010Interprets
Section 314(1) defines disposal to include disposing of part of property or granting an interest. The court considered the provision as part of the statutory structure governing whether property could be followed into another person’s hands. (see para [47])
Section 314(2) treats a payment to another person as a disposal. The court considered the provision within the statutory tracing scheme but held that direct acquisition of property through unlawful conduct was not a subsequent disposal by the wrongdoer. (see paras [47]; [57]-[60])
[2025] EWHC 1401 (KB) · 6 June 2025Limits
The judgment considers section 314 but concludes that it does not assist because the deposit was not property for the purposes of the claimant’s argument (see para [44]).
The judgment rejects reliance on section 314(4), holding that the argument failed because the deposit was not property capable of being treated as obtained for value (see para [44]).
What each judgment says about section 314 is in the case-law panel in the full Act.
441.‘Disposing’ of property is a key feature of the provisions at section 304 and305, which deal with following and tracing property. Disposal of property may take place, for instance:
where the property is dealt with to some extent only (including where an interest in the property is created – for example where a tenancy is granted out of freehold real property); a disposal might also consist of the grant of an interest in a part (subsection (1));
where a person makes a payment, in cash or any other kind of property, to another (subsection (2));
where property changes hands on death (subsection (3)).
442.Subsection (4) is relevant to the protection provided at section 308(1) for persons who obtain property ‘for value’. It provides that a person obtains property ‘for value’ only when he has given executed consideration for it. That means that if someone obtains property in return for a promise to pay for it or to perform some service in exchange, that will not count as having ‘obtained for value’ until the payment is actually made or the service performed.