Law Report: Illegality no bar to property claim: Tinsley v Milligan - House of Lords (Lord Keith of Kinkel, Lord Goff of Chieveley, Lord Jauncey of Tullichettle, Lord Lowry and Lord Browne-Wilkinson), 24 June 1993
Where a claimant relied on the presumption of a resulting trust, ie, that two persons had jointly bought property registered in only one name, so that the named party held it in trust for them both, the claimant need only prove a contributory payment and a common intention upon which both of them acted, and was not forced to rely on an illegal plan thereby to defraud the Department of Social Security, and so could recover a share in the property's value.
The House of Lords by a majority dismissed an appeal by Stella Tinsley against the Court of Appeal decision ((1992) Ch 310) which, also by a majority, had (i) upheld the dismissal, by Judge Hywel ap Robert in Caerphilly County Court, of her claim for possession of 141 Thomas Street, Abertridwr, Mid-Glamorgan, and (ii) ruled that she held it on trust for the respondent, Kathleen Milligan, and herself in equal shares.
The house had been registered in the sole name of Miss Tinsley, but had been bought by the women jointly and run as a lodging house. They had agreed the legal title should be in Miss Tinsley's name to facilitate the making by Miss Milligan of false claims on the Department of Social Security (on the basis, inter alia, that she did not own her own home but was a lodger).
The parties later fell out and wished to sell the house. Miss Tinsley then asserted sole ownership, arguing that the court should not give effect to an equitable interest arising from a transaction which was unlawful by reason of a claimant's unlawful purpose; and that accordingly Miss Milligan was unable to establish any interest in the house or defeat Miss Tinsley's claim to possession.
James Munby QC and Alexander Hill-Smith (Blake Lapthorn, for Philip G Rees, Risca) for Miss Tinsley; Vernon Pugh QC and Philip Davies (Belmont & Lowe, for Hugh James Jones & Jenkins, Cardiff) for Miss Milligan.
LORD BROWNE-WILKINSON said it was clearly established that at law, as opposed to equity, property in goods or land could pass under or pursuant to an illegal contract. But Miss Tinsley contended that different principles applied in equity, and that equity would not aid Miss Milligan to enforce an equitable, as opposed to a legal, proprietary interest since, as a party to the fraud on the DSS, she did not come to equity with clean hands.
But to draw such distinctions between property rights enforceable at law and those requiring the intervention of equity was surprising more than 100 years after law and equity had become fused. In reality, English law in 1993 had one single law of property made up of legal and equitable interests. If a person could enforce a property right acquired under an illegal transaction, the same rule should apply to any property right so acquired, whether such right was legal or equitable.
Here, Miss Milligan claimed an interest in the house under a resulting trust, based not on contractual obligation but on a common intention, acted upon by the parties to their detriment. Where two parties bought a property conveyed into the name of only one of them, that party was presumed to hold the property on a resulting trust for both, in shares proportionate to their contributions.
If this presumption applied, the plaintiff did not have to rely on the illegality. If he proved the property was vested in the defendant alone but that he provided part of the purchase price, or voluntarily transferred money to the defendant, the plaintiff established his claim under a resulting trust unless the contrary was shown.
Here, Miss Milligan simply pleaded the common intention that the property should belong to them both and that she contributed to the purchase price. She was not forced to rely on the illegality to prove her equitable interest. It was Miss Tinsley who had to rely on the illegality.
Lord Jauncey and Lord Lowry concurred. Lord Goff and Lord Keith dissented.
Newcastle winger is in Argentina having chemotherapy
Returning to the stage after 20 years makes actress feel 'nauseous'
Top conservatoire offers ‘groundbreaking’ arts degree
- 1 Scottish independence: Ireland since 1919 is a lesson for Scotland in what a Yes vote means
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 Grandmas keep accidentally tagging themselves as Grandmaster Flash on Facebook
- 4 Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
- 5 Kanye West halts concert after two fans don't stand up - doesn't realise one is in wheelchair and the other disabled
Islamic State: Pope is 'being targeted by Isis', Iraqi ambassador to the Holy See warns
Jennifer Lawrence and Kate Upton nude pictures exhibition cancelled after artist concedes photos were 'stolen property'
Scottish independence referendum: A nation divided against itself
John Travolta addresses former pilot's gay romance allegations publicly for the first time: 'That was the lowest I'd ever felt'
Richard III: Two years after his body was found scientists discover how he died
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
Portuguese academic says British are 'filthy, violent and drunk'
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
£50 - £85 per day: Randstad Education Preston: Rapidly developing and growing ...
£1034496 - £1516224 per annum: Randstad Education Cambridge: The Job:Randstad ...
£85 - £140 per day: Randstad Education Preston: Randstad Education are urgentl...
£50 per day: Randstad Education Cheshire: SEN Teaching Assistant EBD , Septemb...