A typical example would be where a couple decide to purchase a property together, but one of them, for whatever reason, can’t get a mortgage. As a result, the property is purchased in the sole name of the person who is able to obtain the mortgage yet the parties intend the beneficial interest in the property to be held jointly.
Difficulties can arise if the relationship breaks down. Without an express declaration of trust, it will be necessary for anyone wanting to claim an interest in the property, as the non-legal owner, to show that there was a common intention that both should have a beneficial interest in it; and that they acted to their detriment in the belief that they had a beneficial interest in it.
If it is not possible to point to an express agreement, an intention to share the property beneficially can be implied from direct financial contributions to the purchase price by the non-legal owner, whether initially or by payment of or towards mortgage instalments.
Another example would be where a daughter has agreed to give up full time work and move in with her parents who are elderly and frail in order to care for them on the promise/understanding that she will inherit their property on their death. The parents then die leaving their entire estate by Will to a local charity.
If the daughter can show that she relied on the promise of her parents to leave the property to her, and that she has suffered detriment as a result, the Court may award the property to the daughter.
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