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Equitable Interests Problem Notes

Law Notes > Property B Notes

This is an extract of our Equitable Interests Problem document, which we sell as part of our Property B Notes collection written by the top tier of Monash University students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Property B Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Equitable interests arising by operation of law: trusts and estoppel Introduction: what is sought/must be proved Position in law
... has the legal interest in the property, since he/she is [registered proprietor etc]; this interest is conferred by the act of registration (Breskvar). Here, circumstances suggest that the position in equity differs from that in law. Position in equity

Express trust

1. A declaration of the trust (eg 'I declare that I my land on trust for Y'). This must be in writing: PLA s 53(1)(b).

2. Transfer (eg 'I transfer my land to X to hold on trust for Y'). This must be in writing: PLA s 53(1)(a).

Resulting trust Resulting trust (RT)?
... may argue there is a RT, where equity presumes a party conferring a property interest did not intend to transfer his/her beneficial interest. RTs do not need to be in writing: PLA s 53(2). There is a presumption of a resulting trust if...

1. [Voluntary transfer] ...the owner of property transfers a whole/part interest to a volunteer, or buys property for a volunteer.

2. [Unequal contributions] ...there are unequal contributions to the purchase price not reflected in the legal title. A presumption that the parties hold the properties on trust for themselves in shares proportionate to their contributions then arises (Cummins). This is a 'purchase money' resulting trust. a. Is Y's contribution a contribution to purchase price?
i. A contribution directly to the purchase price at the time of purchase clearly is.

1. Purchase of land and later building of a house on the land may be considered a single, composite transaction: Cummins (possibly inconsistent with Calverley)

ii. A contribution to incidental costs (stamp duty, legal costs, bank charges, registration fees) is a contribution to the purchase price: Boumelhelm iii. assumption of liability under a mortgage loan used to fund the purchase, which is a contribution to the purchase price (regardless of whether the person assuming liability pays off the loan): Calverley

1. The parties are taken to have made contributions reflecting their shares of the liability: Calverley

2. ... a mortgage repayment, which is not a contribution to the purchase price, but rather a payment to secure release of the charge: Calverley a. However, the court might deal with this by equitable accounting principles (such as by an equitable lien) if a person was unjustly enriched by mortgage payments made for him/her: Calverley The presumption of a RT may be rebutted (the onus of proving this is on the person seeking to rebut) if...
... a presumption of advancement operates: this presumes the transferor intended to give the other a beneficial interest due to their special relationship. i.

The presumption of advancement will operate in cases of transfers from...
a. ...husband to wife b. ...fiance to fiancee c. ...parent (of either sex) to child i. It is now likely to apply from mother to child: Nelson v Nelson (HCA), Brown (NSWCA 1993)

ii. However, the presumption will not operate in cases of transfers from...
i. ... one de facto partner to another ii. ...wife to husband (Cummins)

iii. However, a presumption of advancement can be rebutted by evidence of actual intention to the contrary at the time of the transfer or purchase.

...there is evidence of actual intention (express or inferred from words or conduct) to pass a beneficial interest: Cummins. i.

The intention is that of the parties (and particularly that of the person passing the interest) at the time of the transfer or directly before, and can be evidenced by their acts, words and conduct at that time.

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