For love, not money: establishing beneficial interests in sole name cases

The recently-reported case of Dobson v Griffey [2018] EWHC 1117 (Ch) provides a helpful reminder of the difficulties in cohabitation cases when seeking a share of a property that is held in another party’s sole name. The decision is that of HHJ Matthews sitting as a High Court Judge. The judgment considers the standard of proof that a claimant must meet, the importance of mutual intentions and the thorny question of discussions between the parties (and solicitors) after separation and the extent to which they are relevant to the claim itself.

In 2005 the parties looked for a suitable property to purchase and renovate as their family home. The farm they found was put in the defendant’s sole name as was the mortgage. The claimant said that she had contributed £10,000 towards the cost of the property but this was denied by the defendant, who provided all other monies.

What followed was years of hard work by both parties, including “heavy and laborious work” by the claimant which amounted to a “significant contribution to the renovations” [76]. The parties separated in 2012 and the defendant sold the farm some years later.

The claimant sought half of the profit from the sale of the farm, pleading a common intention constructive trust and/or proprietary estoppel. She said that the parties had agreed before purchase that they would each have an equal interest in the property and that she had relied upon that agreement to her detriment. The defendant said that there had been no such agreement.

In part the claimant relied upon the defendant’s actions after separation to infer his intentions regarding the property. He had e-mailed her in 2012 offering her half of the profit on the sale of the farm, although they did not reach agreement at the time. When the farm sold some years later, a sum was paid into a joint bank account held by the two firms of solicitors acting for the parties. The claimant said that this demonstrated the defendant’s intentions and understanding of how the property was held.

HHJ Matthews gave a clear and concise judgment which is well worth reading. He found that the claimant had failed to establish an interest in the property. In his judgment, “[t]he defendant was paying for the farm, and he wanted it to be his own exclusive property. This may have been ungenerous, but it was not morally wrong, let alone legally so” [82].

In particular he rejected the claimant’s argument that her significant contributions to the property were because of an agreement that she would have an interest in it. At para 84 he said:

“Her labour and commitment were understandable in the context of their relationship and their intended long-term future together with children. This was to be her home, and that of her children. It is unnecessary to suppose some quasi-commercial bargain between them to explain it.”

He went on at para 89 to say:

“She did what she did because she had decided to make a home with the defendant and hopefully to have children with him there. It is entirely natural to suppose that she would have wanted to use her skills and abilities to make the best possible home that she could for them all, rather than because she was trying to make money.”

This echoes the reasoning in other proprietary estoppel cases such as Lissimore v. Downing [2003] FLR 308.

The judge carefully considered whether there was a common intention between the parties to share the beneficial interest in the property. He found that there was not. He emphasised the need for the parties’ intentions to be mutual. Plainly this is required to establish a common intention constructive trust (the clue is in the name). But equally, a claimant’s own intentions or expectations are insufficient to establish a proprietary estoppel claim unless the expectation came from “any assurance or conduct of the defendant” [59].

Finally, the judge considered the relevance of the defendant’s conduct (and that of his solicitors) after separation. He found that the defendant’s e-mail to the claimant upon separation offering her half of the profit was not evidence of what the parties’ intentions were at purchase or during the relationship. Neither did the judge appear to place any weight on the payment of funds into the solicitors’ joint account on sale of the property: the inference is that this was an ordinary part of litigation and again was not evidence of the parties’ intentions some 13 years earlier.

In summary, this is another example of the difficulties in establishing an interest in a property that is in another party’s sole name. It is also a reminder of the importance that the courts attach to the fact of a committed relationship. It brings to mind the comments of Lord Walker and Lady Hale in Kernott v. Jones [2011] UKSC 53 at paragraph 12 when they remarked that:

“In family disputes, strong feelings are aroused when couples split up. These often lead the parties, honestly but mistakenly, to reinterpret the past in self-exculpatory or vengeful terms.”

It is easy, with hindsight and after what may have been an acrimonious break-up, to reinterpret the reasons for a person’s years of work, commitment or contribution to the family home. This case shows that the courts are alive to this and will not easily find commercial intention in the place of domestic generosity.