Stack (Appellant) v. Dowden (Respondent)
HOUSE OF LORDS
OPINIONS OF THE LORDS OF APPEAL FOR JUDGMENT
IN THE CAUSE
Stack (Appellant) v. Dowden (Respondent)
 UKHL 17
LORD HOPE OF CRAIGHEAD
LORD WALKER OF GESTINGTHORPE
Lord Bridge continued (132H-133B):
In concurring in this passage the House was unanimously, if unostentiously, agreeing that a "common intention" trust could be inferred even when there was no evidence of an actual agreement. Apart from two bare references to "a constructive trust or a proprietary estoppel" (at 132G and 133F) Lord Bridge did not refer to the elaborate arguments of counsel (at 110G-125C) addressed to him as to the varieties and interaction of these two concepts.
He treated this as giving rise to a constructive trust in the proportions of about 80% for Mr Whipp and 20% for Mrs Drake.
On the facts of that case, applying the doctrine of a resulting trust in the way that Mrs Drake proposed would have been doubly artificial, as it would have unnaturally split the project into two elements, only one of which was to be taken into account in the resulting trust exercise; and it would have ignored the parties' actual common intention for the project as a whole. Their common intention, as found by the judge, was for beneficial ownership in shares corresponding to their overall contributions. In a case about beneficial ownership of a matrimonial or quasi-matrimonial home (whether registered in the names of one or two legal owners) the resulting trust should not in my opinion operate as a legal presumption, although it may (in an updated form which takes account of all significant contributions, direct or indirect, in cash or in kind) happen to be reflected in the parties' common intention.
However, Deane J described this as a constructive trust, and he had earlier (at p 612) treated a resulting trust as excluded by evidence of the parties' common purpose (building and running an arts and crafts centre), even though that purpose had failed. Professor Birks would have treated this as a resulting trust (see Birks and Rose eds, Restitution and Equity Vol 1 (2000) pp 275-279). Other scholars disagree. Drake v Whipp  1 FLR 826 might have been analysed in this way so as to produce the same result, but only if the whole of each party's contribution had been taken into account in applying the resulting trust.
BARONESS HALE OF RICHMONDMy Lords,
How does this problem come about?
The applicable legal principles
The issue in that case was whether there were only three quite narrowly defined situations in which the contrary could be found or whether there were other circumstances which could lead to a contrary conclusion. Their Lordships first observed that it was improbable that joint tenancy in equity was intended where joint tenants in law held commercial premises for their separate business purposes. This is a reminder that the parties may not intend survivorship even if they do intend that their shares shall be equal. In many commercial contexts, and no doubt some domestic ones, it will be highly unlikely that the parties intend survivorship with its tontine "winner takes all" effect. Their Lordships went on to point out that there was no fundamental distinction between buying a lease at a premium with a token rent and taking a lease at a rack rent with no premium. In the latter case the rent is equivalent to the purchase money. This is a reminder that property is often acquired over time, so that payment of mortgage instalments is the equivalent of payment of the purchase price. Finally, their Lordships identified, at p 561, the features of the case before them which appeared to them "to point unmistakably towards a tenancy in common in equity, and furthermore towards a tenancy in common in unequal shares". Amongst these were not only that the parties had paid the refundable deposit, stamp duty, survey fees, rent and service charges in unequal shares, but also that those shares were proportionate to the actual square footage which each of them occupied.
There is no need for me to rehearse all the developments in the case law since Pettitt v Pettitt and Gissing v Gissing, discussed over more than 70 pages following the quoted passage, by Chadwick LJ in Oxley v Hiscock  EWCA Civ 546,  Fam 211, and most importantly by my noble and learned friend, Lord Walker of Gestingthorpe in his opinion, which make good that proposition. The law has indeed moved on in response to changing social and economic conditions. The search is to ascertain the parties' shared intentions, actual, inferred or imputed, with respect to the property in the light of their whole course of conduct in relation to it.
Oxley v Hiscock has been hailed by Gray and Gray as "an important breakthrough" (op cit, p 931, para 10.138). The passage quoted is very similar to the view of the Law Commission in Sharing Homes (2002, op cit, para 4.27) on the quantification of beneficial entitlement:
That may be the preferable way of expressing what is essentially the same thought, for two reasons. First, it emphasises that the search is still for the result which reflects what the parties must, in the light of their conduct, be taken to have intended. Second, therefore, it does not enable the court to abandon that search in favour of the result which the court itself considers fair. For the court to impose its own view of what is fair upon the situation in which the parties find themselves would be to return to the days before Pettitt v Pettitt  AC 777 without even the fig leaf of section 17 of the 1882 Act.
In the case before us, he observed at para 24:
With these passages I entirely agree. The approach to quantification in cases where the home is conveyed into joint names should certainly be no stricter than the approach to quantification in cases where it has been conveyed into the name of one only. To the extent that Walker v Hall, Springette v Defoe and Huntingford v Hobbs hold otherwise, they should not be followed.
But the questions in a joint names case are not simply "what is the extent of the parties' beneficial interests?" but "did the parties intend their beneficial interests to be different from their legal interests?" and "if they did, in what way and to what extent?" There are differences between sole and joint names cases when trying to divine the common intentions or understanding between the parties. I know of no case in which a sole legal owner (there being no declaration of trust) has been held to hold the property on a beneficial joint tenancy. But a court may well hold that joint legal owners (there being no declaration of trust) are also beneficial joint tenants. Another difference is that it will almost always have been a conscious decision to put the house into joint names. Even if the parties have not executed the transfer, they will usually, if not invariably, have executed the contract which precedes it. Committing oneself to spend large sums of money on a place to live is not normally done by accident or without giving it a moment's thought.
The facts of this case
On the other hand, he held that all their other savings and investments, including an account in Ms Dowden's name with the Chelsea Building Society (opened in 2000 with the redundancy payment she received from London Electricity before being immediately re-employed with one of its successors), represented "the ways where the parties have allowed their earnings and their savings to be separately divided", so that all should lie where they were.
Applying the law to the facts
LORD NEUBERGER OF ABBOTSBURY
Beneficial ownership: some general points
Beneficial ownership on acquisition: where there is no evidence
Beneficial ownership on acquisition: differential contributions
Beneficial ownership on acquisition: constructive trust
Beneficial ownership: events after the acquisition of the house
The payment issue