Wednesday, January 02, 2013

Thompson v Hurst: Stack and Jones applied

Lord Justice Etherton
A brief summary of Thompson v Hurst [2012] EWCA Civ 1752 (30 March 2012), reported today on Bailii.

The facts in this case were that from 1983 Miss Hurst was the local authority tenant of the property. In 1985 Mr Thompson moved in and they lived there as a couple. In 2001 Miss Hurst purchased the property. The purchase was in her sole name, as Mr Thompson could not get a mortgage. The couple kept their finances entirely separate, with Miss Hurst paying the rent/mortgage and the utility bills, and Mr Thompson contributing towards the housekeeping.

At first instance, the District judge found that there was a common intention that the Mr Thompson was to have a beneficial share in the property, but there was no common intention about what the beneficial interests should be. She therefore determining what would be fair having regard to the whole course of dealing between the parties in relation to the property, and found that Mr Thompson's beneficial interest was 10 per cent.

Mr Thompson appealed, claiming that the District Judge had failed to apply the principles in Stack v Dowden [2007] UKHL 17 and Jones v Kernott [2011] UKSC 53, and that he should have been acknowledged to be entitled to a 50 per cent beneficial interest.

Giving the leading judgment in the Court of Appeal, Lord Justice Etherton dismissed the argument put forward on behalf of Mr Thompson that this should have been treated as a joint legal owner case, as the property would have been purchased in joint names if Mr Thompson had been able to get a mortgage. The District Judge had proceeded correctly and in accordance with the principles in Stack and Jones applicable to sole legal owner cases, and her determination of the parties' respective shares had been carried out "in a careful and exemplary fashion". Accordingly, the appeal was dismissed.

Giving a consenting judgment, Lord justice Lewison pointed out:
"The principles have been authoritatively laid down by the House of Lords in Stack v Dowden and the Supreme Court in Jones v Kernott but it is illuminating to see how those principles are applied. In Stack v Dowden at paragraph 92, Baroness Hale said this:
"This is therefore a very unusual case. There cannot be many unmarried couples who have lived together for as long as this, who have four children, and whose affairs have been kept as rigidly separate as this couple's affairs were kept. This is all strongly indicative that they did not intend their shares, even in the property which was put into both their names, to be equal, still less that they intended a beneficial joint tenancy with a right of survivorship should one of them die before it was severed."
Apart from the number of children, that paragraph could be applied to this case word for word."
Lord Justice Thorpe also gave a consenting judgment.

2 comments:

  1. I'm struggling to understand how he got anything. If his only contribution was to housekeeping expenses, where was the detrimental reliance for a constructive trust?
    I suppose I need to read the whole judgment but I thought Stack simply affirmed the "Equity follows the law" principle.

    ReplyDelete
    Replies
    1. Yes, see paragraphs 8 - 15 of the judgment.

      Delete

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