Essay
Common Intention Constructive Trust Essay
- Module
- Equity (LAW2041)
- Institution
- Queens University Belfast (QUB)
An excellent essay on Common Intention Constructive Trusts. Achieved a First Class Grade.
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IntroductionA common intention constructive trust (CICT) is based on the assertion that two or more parties had
a common intention for assets to be held for their equal benefit, regardless of the legal ownership of
those assets. The law on constructive trusts in the family home context is based around a tension
between the desire of the courts to achieve a result they consider reasonable, using the constructive
trust as a flexible remedy to protect the claimant’s financial interest, and the uncertain basis for this
intervention regarding the party’s common intention. This essay will evaluate the CICT in relation to
unmarried cohabitees in the family home, its implications, and possible alternative approaches
which could be taken instead. It will recognise that the English law needs reformed to offer greater
protection for unmarried couples, just as if they were married.
Evaluation of the CICT
The foundations of the constructive trust come from Gissing v Gissing, which set out a two-stage
process. First, it must be shown that the legal owner of the land induced the claimant to believe they
would be entitled to a share in the ownership and secondly, the claimant must have acted to their
detriment, for example by contributing to the purchase price. Following Gissing, the HoL in Lloyds
Bank v Rosset elaborated upon the restrict approach upon finding a common intention. They found
that the CICT was only to arise in two circumstances: when an express agreement between the
parties that the beneficial interest in the home is shared, or conduct of the parties, in the form of
financial contributions from which the court can infer a common intention.
As Gardner (1993) points out, the central difficulty is that the common intention analysis focuses on
the parties own thinking as the basis for the imposition of a constructive trust, when in fact they will
often have little or no thought to the question of ownership. This is unfair in my view and was
appreciated by Lord Diplock in Pettitt v Pettitt, that proprietary interests are often not thought
about by parties in a relationship when the property is being acquired and paid for, but only when
their relationship deteriorates or breaks down. This viewpoint is plausible; couples will most likely be
thinking about the happy times to come in their new home together, not about when their
relationship is going to break down and who will get what share of the house. At this point, it simply
isn’t practicable to look for their intention as to their proprietary interests, particularly when it is
young couples acquiring homes together. It was on this basis that Lord Diplock was willing to impute
a common intention as to proprietary ownership, considering the agreement that would have been
reached by the parties had they put their minds to it when the property was acquired.
Although this undermines Gissing, Gissing remains the current state of the law; a shift towards
certainty of property rights and away from judicial discretion, which may come as an expense for
unmarried cohabitees in many cases; an unconscionable approach.
Following Rosset, in Oxley and Clarke, it was held that in the absence of an express common
intention regarding the share of property, the quantum of the beneficial interest should be not be
limited and should take in an account of the whole course of dealing. This shows that proprietary
estoppel and constructive trusts can be both be used to achieve the same result, which is certainly a
plausible approach for unmarried cohabitees.
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