Thompson v Hurst
Court of Appeal
Citations: [2012] EWCA Civ 1752.
Facts
The respondent was a council tenant. She lived in the council property with the appellant, with whom she had a romantic relationship. The respondent later bought the council property at a discount under a right-to-buy scheme. The appellant contributed to housekeeping costs, some renovations, and costs associated with the couple’s children. The respondent paid the rent and later the mortgage and all other outgoings. The parties kept their finances separate. When the parties’ relationship broke down, the appellant continued living in the property for four years but stopped making any financial contributions.
The appellant sought a declaration that he was entitled to 50% of the property. He argued that the respondent expressly bought the property as a joint venture for the couple and their children. The only reason he was not a party to the mortgage or registered on the title was because a mortgage advisor told him he was unsuitable since he had been out of work for 6 months.
The High Court held that the appellant had a 10% share under a common intention constructive trust, while the respondent had a 90% share. The appellant appealed.
Issue(s)
- Was the appellant entitled to a 50% interest in the property?
Decision
The Court of Appeal upheld the High Court’s decision. While Stack v Dowden [2007] UKHL 17 established a presumption that the parties share equally in the beneficial title where they are both registered as legal co-owners, the presumption did not apply here. This was because the respondent was the sole legal owner.
The court considered that the High Court judge took into account the correct factors when determining the appellant’s share, in particular:
- The respondent was solely responsible for the purchase price, including the discount, deposit and mortgage;
- The respondent’s financial contribution to the home was much larger; and
- The appellant did not seem to mind not being on the property deeds.
On this basis, the judge was entitled to award the appellant only 10%.
This Case is Authority For…
The presumption in Stack v Dowden [2007] UKHL 17 only applies where the parties are co-owners at law. It does not apply where the parties would have liked to have been co-owners, but where the transfer was ultimately made into one of their sole names, whatever the reason.
Other
The Court of Appeal doubted that a constructive trust existed in this case in the first place, as the evidence for a common intention was weak. However, this point was not appealed.
