Implied trusts of family-owned land

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This quiz is based on Chapter 17 of Land Law. Remember, you need to know not only which answer is correct, but also why it is correct.

Which of the following is not true of a resulting trust?

It crystallizes on the day that the property is acquired.

It is merely a presumption that the legal owner of property holds that property upon trust for another person or persons.

It will arise whenever someone contributes towards the repayment of a mortgage secured over land to which they do not hold the legal title.

There is a direct link between the proportions of the contributions to the proportions of the beneficial interest.

Clear selection

In the case of a purchase of a house or flat in joint names for joint occupation by a married or unmarried couple where both are responsible for any mortgage, there will be a presumption of a resulting trust if the couple have contributed to the deposit (and any other element of the purchase) in unequal shares.

True

False

Clear selection

According to the reasoning in Marr v Collie, the most important factor in whether a presumption of resulting trust can arise is whether:

The land was purchased as an investment or a home.

The parties to the purchase were a cohabiting couple.

The parties to the purchase contributed to it in equal proportions.

There is a significant age difference between the parties to the purchase.

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The principle underlying the decision in Lloyd’s Bank v Rosset [1991] 1 AC 107 is that equity will always impose a constructive trust to prevent one party to a transaction gaining a manifest and unfair advantage over the other party.

True

False

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In Stack v Dowden [2007] 2 AC 432, what was the main concern that Baroness Hale expressed about the observations of Lord Bridge in Lloyds Bank Plc v Rosset [1991] 1 AC 107?

His twofold classification (express and inferred intention) is inconsistent with previous cases.

He set the threshold for establishing inferred intention too low.

He set the threshold for establishing inferred intention too high.

He set the required level of detrimental reliance too low.

Clear selection

Cathy recently inherited a substantial sum of money and Emma had a win on the National Lottery. They decided to use these moneys to purchase a house together. Emma paid the deposit of £15,000 and the balance of £135,000 came from Cathy’s inheritance. Last week, Cathy told Emma to leave the house immediately. Which two of the following should you include in your advice to Emma?

There may be a resulting trust in Emma’s favour due to her payment of the £15,000 deposit; if so, she is entitled to £15,000.

There may be a resulting trust in Emma’s favour due to her payment of the £15,000 deposit; if so, she is entitled to 15/150 of the value of the house.

There may be a constructive trust in Emma’s favour based on an inferred agreement between Cathy and Emma, and Emma’s detrimental reliance.

There is no evidence that Emma has satisfied the threshold for an inferred intention constructive trust.

It does not matter whether the trust relationship between the parties is constructive or resulting as Emma will only be entitled to 15/150 of the value of the house in either case.

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If the legal title to the land is vested in all the potential beneficiaries, the courts start from the assumption that equity follows the law; that is that the beneficial interest is divided equally between the beneficiaries.

True

False

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Although the courts now take an holistic approach when quantifying the beneficial interest, they still start by trying to determine the intention of the parties; the holistic approach it is not a licence to simply impose whatever result the court believes to be fairest?

True

False

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Which of the following statements is correct?

Both common intention and remedial constructive trusts are based on an agreement, whether actual or fictitious, between the parties.

The Matrimonial Causes Act 1973 adopts the principles of common intention constructive trusts to resolve property disputes arising when a marriage or civil partnership is dissolved.

Common intention constructive trusts are less flexible than remedial constructive trusts when it comes to dealing with circumstances in which individual shares in co-owned property may not have been considered, let alone discussed.

Remedial constructive trusts are less flexible than common intention constructive trusts when it comes to dealing with circumstances in which individual shares in co-owned property may not have been considered, let alone discussed.

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