AA v BA [2025] EWFC 278 (B) (01 August 2025)

Neutral citation number: [2025] EWFC 278 (B) Claim No: 1728381924728838 IN THE FAMILY COURT AT BRADFORD Date: 1 st August 2025 Before : District Judge Sundstrem-Brown - - - - - - - - - - - - - - - - - - - - - Between : AA Claimant - and – BA Defendant - and – CA and DA Intervening - - - - - - - - - - - - - - - - - - - - - Mr Sproston of Counsel (instructed by Atkinson Firth Solicitors ) for AA Mr Ali of Counsel (instructed on a Direct Access Basis) for the CA & DA BA appeared as a litigant in person Hearing date: [9 th and 10 th July 2025] - - - - - - - - - - - - - - - - - - - - - Judgment Approved This judgment was handed down remotely at 2pm on 1 st August 2025 District Judge Sundstrem-Brown This is a preliminary issue hearing in a financial remedy application. The purpose of the hearing is to determine the extent, or otherwise, of the intervenors interest in assets held in the name of the husband and wife. The applicant in this matter is AA, she is the applicant wife. She was represented before me by Mr Sproston. The respondent is BA, he is the respondent husband and a litigant in person who has the assistance of a Qualified Legal Representative (QLR) for the purposes of these proceedings. The interveners are CA and DA, they are the husband's parents. They have been litigants in person throughout these proceedings but have attended at each hearing with the assistance of a direct access barrister. Mr Ali has represented the interveners at this hearing. The interveners claim that they are the true beneficial owners of 2 properties, the family home (registered in the sole name of the husband) and an investment property (registered in the sole name of the wife). The intervenors also claim to be the true beneficial owners of shares held in the name of the husband and the wife. The intervenors also claim to be the beneficial owners of an ISA account held in the name of the husband, called the CoFunds account. The husband agrees with the intervenors position. The wife denies their claim and asserts that the payments made by the intervenors towards purchase and/or works on properties were intended to be a form of inheritance tax planning, and as such were absolute gifts. The wife accepts that culturally the intervenors may have lived with them in the future, but that this did not provide them with an interest in the family home. The Litigation History These proceedings began on the 17 th of October 2024 when the wife applied by form A for financial remedy. A first appointment was listed to take place on the 28 th of January 2025. In advance of that hearing the interveners applied for leave to be joined in to the proceedings. The first appointment took place on the 8 th of April 2025 where the interveners were in attendance and represented by Mr Ali. Directions were given for the matter to be listed for a further directions appointment. The matter came before me on the 28 th of May 2025 at that hearing I directed that the interveners were to comply with paragraph 16 of the order of 8 th April requiring them to serve on the other parties their points of claim and a witness statement setting out their case is fully in respect of their interests in the various assets. A further hearing for PTR before me on the 30 th of June 2025. At this hearing further directions were provided including for the provision of skeleton arguments dealing with any application relating to the covert recordings provided by the wife. In advance in the final hearing a further application was received seeking disclosure of the conveyancing file relating to the family home. This was not opposed by any of the parties and I ordered that the file be obtained, but only on the strict understanding that if the conveyancing file was not available for the preliminary issue hearing, then the hearing would not be adjourned as it was not proportionate to do so. I noted that I would have expected the conveyancing file to have been one of the first pieces of evidence sought by the parties, and certainly the applicant. This hearing The hearing before me has progressed as a remote hearing, I have heard oral evidence from CA (the husband's father) on behalf of both interveners. I raised with the other parties whether DA (the husband's wife) would wish to give evidence or whether she would simply be supporting and relying on her husband's evidence. At the outset of the hearing I was told that DA would not provide any separate or additional evidence and therefore all parties agreed it was not necessary to hear from DA. Having concluded CA's evidence I asked again whether it was intended for DA to give evidence. I was told not and the matter proceeded to hearing evidence from the husband. I then heard evidence from the wife. For the purposes of this hearing I have also considered a paper copy of the trial bundle and the supplemental bundle. I have also had the benefit of two skeleton arguments from each counsel involved in this particular case and written closing submissions. Throughout this case the interveners and the husband have been acting in person and whilst I've given them some leeway in this regard I have noted the observations in the case Barton v Wright Hassell. I have also considered the medical evidence that has been filed. I have ensured at all stages that the interveners are able to hear proceedings, I have allowed time for breaks. I am satisfied for the article 6 rights of all parties have been fully and properly respected. The Issues The points of claim set out that the intervenors claim amounts to £866,300 plus shares and savings which they assert are loans advanced to the husband and the wife between 2013 and 2024 for the purposes of the purchasing and improving the family home and investment property The intervenors claim there was a common intention that the true beneficial ownership of the family home would remain within the intervenors. The intervenors also assert that the additional works undertaken to the property were paid for by the intervenors on the basis that they were the true owners of the property. A similar argument is made in respect of the investment property. The particulars of claim say that in 2019 the intervenors paid £88,000 cash to acquire a second property. This property was placed in the wife's name for tax purposes but the intervenors retained the true beneficial ownership of the property. There is an ISA account called CoFunds. This is held in the name of the husband. The position advanced by the intervenors is that the income from the investment property was paid into that account and therefore they are fully entitled to the contents of the CoFunds account. Finally, the intervenors claim £8,000 for shares bought in the names of the husband and the wife. They assert their claim at £4000 per person. It is agreed between all of the parties that the dividend income from the shares were paid to the intervenors, however it is the wife's position that this did not alter the fact that the shares were hers. The Law I have had helpful skeleton arguments from both counsel. The law appears to be largely agreed save for one discreet point. Mr Sproston takes issue with the was that Mr Ali characterises this claim. Mr Sproston notes that this is a sole owner case, akin to Kernott and therefore he asserts that the intervenors must establish that there was a common intention that they were to have any interest in the property before the court computes what share they are to receive. I agree with that analysis. The law that I will apply can therefore be summarised as follows: When determining this claim I must make finding of fact. It is for the person who asserts a fact to prove this to the requisite standard, i.e. the balance of probabilities. Findings of fact must be made on the basis of the evidence provided and any inferences that can be properly drawn from evidence. In the case of a single legal owner, such as the present, where there is no express declaration of a trust, the intervenors first need to establish some sort of implied trust, normally what is now termed a common intention constructive trust. The intervenors must show that it was intended that they were to have a beneficial interest at all. That can only be achieved by evidence of the parties' actual intentions, express or inferred, objectively ascertained. If such evidence does show a common intention to share beneficial ownership, but does not show what shares were intended, then each of them is to have that share which the court considers fair, having regard to the whole of dealing in relation to the property. The presumption of a resulting trust is rebuttable. To rebut the presumption any evidence tending to indicate that the intervenor's intention was that the husband or wife should take the beneficial interest in a property acquired with the intervenors money is relevant, as would the intervenors intention to make a gift to the husband or wife. The presumption of resulting trust is therefore only to be relied upon as default rules where there is no sufficient evidence to displace them. Per para 25-011 and 25-012 of Snell's Equity. When considering the common intention between the parties I must have regard to the whole course of dealing between the parties. As per para 69 of Stack "These include: any advice or discussions at the time of the transfer which cast light upon their intentions then; the reasons why the home was acquired in their joint names; the reasons why (if it be the case) the survivor was authorised to give a receipt for the capital moneys; the purpose for which the home was acquired; the nature of the parties' relationship; whether they had children for whom they both had responsibility to provide a home; how the purchase was financed, both initially and subsequently; how the parties arranged their finances, whether separately or together or a bit of both; how they discharged the outgoings on the property and their other household expenses." I must be alive to the prospect of the parties re-interpreting past events in order to support their respective case, as per para 68 of Stack. "The burden will therefore be on the person seeking to show that the parties did intend their beneficial interests to be different from their legal interests, and in what way. This is not a task to be lightly embarked upon. 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. They also lead people to spend far more on the legal battle than is warranted by the sums actually at stake. A full examination of the facts is likely to involve disproportionate costs." The Evidence The wife has included covert recordings in her witness evidence. There has been no application by the wife to rely on hearsay evidence. The covert recording of CA was part of a longer conversation, and the covert recording of the husband is deployed by the wife on the basis of what the husband did not say rather than what he actually said. In closing submissions Mr Ali asserted that a further interpretation of these covert recordings would be that the wife accepted that the intervenors were the true owners of the property as she discussed not being 'pushed out' of the property. The wife's response to this was that it was a cry for help. The covert recordings add more heat than light. They are open to misinterpretation, one of which is in a language I do not understand so I am invited to consider a translation without any nuance. I place absolutely no reliance on the covert recordings. CA The first witness I heard from was CA. He was a witness who was doing his best to assist the court. However, it quickly became apparent that there had been some significant support provided by the husband to his parents. During the course of cross examination CA explained to me that his son had written his witness statement and that he had signed it. CA told me that during the course of his evidence that although there was a reference to the CoFunds account in his witness statement, the first he understood or knew about it was about seven days ago. This contradicted the husbands account that CA opened the CoFunds account for the husband with £10,000 some years ago. The quality of CA's evidence was further diminished when I heard from the husband, who told me that while drafting the statement he had shown his father some documentary evidence and had on at least one occasion explained to his father his (BA's) recollection of what had happened and his father had agreed with him. To add to this the husband alleged, for what appears to be the first time, that his father suffers with dementia. The husband's position was that where there is a discrepancy between the father's written evidence and his oral account I should prefer CA's written evidence (as prepared by the Husband). The intervener had provided a letter from his GP dated the 30 th of May 2025. In this letter there is a list of CA's medical conditions. The letter lists Diabetes Mellitus two, hypertension, ventricular septal defect and Periferal neuropathy of both legs. This letter requests a remote hearing because of frequent trips to the toilet. There is no reference to dementia in this letter nor in the witness statement filed on behalf of the intervener. I have taken a cautious approach in assessing the evidence of the CA. However, even allowing for the above I found him to be an inconsistent witness. By way of example, CA explained to me that he had no intention of engaging in inheritance tax planning. He told me that he had been made rich by this country and he had no objection whatsoever to paying tax, including inheritance tax. He told me that all his money could go to England. I gained the impression that he was trying to persuade me that he found it offensive to suggest that he engaged in tax planning. When CA was taken to his written evidence, it was pointed out that he had accepted that he engaged in attempts to minimise his own tax burden. For example at paragraph 24 of his statement he notes " we agreed to put the title deeds for the matrimonial home in the respondents name, as he did not have a house in his name and we were persuaded by the applicant and the respondent that it would be tax efficient to put the property in the surname of name of the respondent. " The note continues that they would save money on stamp duty. Also, at paragraph 35 " in January 2019 they bought the [Investment Property]. The applicant works part-time and pays income tax at 20% whilst the respondent pays income tax at 40% and so a lower rate of tax could be paid on the rental income if the rental properties are in the applicant's name (this was the same logic for placing all five rental properties in the applicant's name). " CA was inconsistent in respect of other aspects of his claim. For example his initial claim was that he had made loans to his family and that these were to be repaid. When it was put to him but these were not loans, but they were gifts, CA was adamant that that was inaccurate. CA went on to tell me that he would give his children money and that if he gave them money he did not tell him it was a present or a gift. He added that if they chose to return it then it was up to them. When clarifying this account he said he would give money to help them and that " I never said anything but expected and hoped that they return it " he said that BA returned most of the money and the other two returned small amounts now and again. I took this to mean that BA's siblings had not returned the majority of the money provided to them by CA. There were further inconsistencies in the evidence provided by the intervenors. For example at paragraph 17 their statement says " it was never intended to give the respondent or the applicant our life savings and retirement provisions totalling £866,300 as this will be completely unfair on our other children. Our intention was for the money to be a loan to purchase a property... ". In his oral evidence CA explained that he currently had his own CoFunds account with roughly £500,000 in, alongside his own property and his pension provision. I can think of no good reason why CA sought to suggest that all his life savings were provided to BA, other than seeking to bolster his case. CA was asked to explain his understanding of why the investment property was put the wife's name. He had no explanation, he told me that he gave money to his son to invest and that's what they were doing. This ran rather differently to his assertion in the particulars of claim that he was the beneficial owner of the property. CA also explained that he had a very difficult time during the divorce with the husband's first wife. He said that he lost a lot of money and " I could see the same thing happening here ". He explained that he wasn't involved in the first divorce. I got the impression that the loss of money related to the settlement that the first wife received. As it appears as though CA offered some assistance in respect of paying out the first Mrs BA. When asked about his intention following his death, the intervenor was first of all asked about the shares. He explained that that's so far as the wife's interest in the shares is concerned, "if I die first she can have the shares". He was then asked about his position in respect of the family home. What would happen to it if he died. Again his answer was clear. It will be up to the owner to decide. This is indicative that CA accepted the beneficial owner of the properties and assets are those whose name they are currently held. My impression of CA is that he is a shrewd man who has been successful in his chosen career. He is generous and had supported his children throughout his life. His written evidence is littered with examples of ways he has sought to minimise tax liability by putting assets in the names of others, yet he seeks to persuade me that he would never engage in tax planning for his children's benefit. I found that this was illogical, not supported by the evidence and highly unlikely in any event. In my judgement this is fundamentally important when considering the issue of the purpose of the transfers of funds. The Husband The next witness I heard from was the husband. I note at this point that the majority of the evidence he gave was provided for the first time from the witness box. The husband has represented himself throughout these proceedings. He has had ample opportunity to provide a written account but has repeatedly chosen not to. A good example is the husband's response to the wife's questionnaire. The husband was asked to provide the declaration of trust setting out his parents interest in the family home. His response was that the interveners will cover this in their statement. The husband was asked to provide proof of payments made to him from the intervenors, and again his response was that the intervenors will cover this in their statement. The husbands approach to providing limited answers extends to issues other than the purchased of properties. He was asked to explain a credit of £23,500 in February 2024. His answer is that this was a payment was from his parents, the intervenors will cover this in their statement. The husband's evidence in the main proceedings is clearly lacking, his evidence on the intervenors case is equally lacking. He filed a statement which was initially one line which told me that he agrees entirely with the interveners position. He then subsequently filed a statement aimed at addressing the suggestion that his parents loaned money and he repaid money. There is no evidence of the various sums paid by the father coming into his account. (I note that the spreadsheet indicates that cheque stubs have been provided to the court, I assume that's in the previous divorce proceedings). There is no evidence or bank statements in these proceedings to correlate to the alleged payments made by the father to the husband. I note that the husband has provided no documentary evidence of money going out to pay for the properties. No evidence of the money going out to pay their renovation works. There is also a simple assertion that all of the money in the CoFunds account belongs to CA despite the fact it appears that a large proportion of that money was in existence even before the properties that were the subject of these proceedings were bought. I have considered the husband's written evidence, or lack thereof, because it's important to recognise that the vast majority of what he told me in oral evidence was not supported by documentary evidence or a witness statement and it is therefore very difficult to assess his consistency. I heard extensive evidence from the husband. Mr. Ali ran the husband through the intervenors case accusing him of manipulating or using his father. Mr Ali accused the husband of abusing CA's trust and taking advantage of him. Despite the tenor of this cross examination, the Intervener and the husband's position were effectively as one. This was clearly underlined when it transpired that the intervenors statement has been written by the husband. The husband explained in evidence that because of CA's issues he would show CA documents in order to explain the position. That the Husband would on occasion tell CA his recollection and CA might agree. This is a most unsatisfactory way of producing a witness statement. However, I would have anticipated that this level of support or collusion would result in a clear and well documented case. It did not. The husband's explanation for when CA's oral evidence deviated from the witness statement was to blame it on his father's cognitive decline. He was asked about the letter from the GP and simply explained that the reason the reference to dementia was missing that was because the letter was to try and obtain a remote hearing and not to excuse his father's attendance. The husband's position was that the documentary evidence he had provided should be sufficient to establish that his father had lent them the money and therefore the intervenors should have it back. When answering questions from Mr Ali the husband explained, as one might expect, that he always assured the father that the family home was CA's and that any time they needed to be works undertaken on the property he would go to his father and tell him it's your house, therefore you should pay for it, or words to that effect. The husband put in no real witness statement about the course of dealing between the parties, no statement addressing these conversations. The vast majority of the husband's evidence was coming from the witness box for the first time. The husband was taken to a text message exchange between the parties from the 30 th of November 2023. In this he sends the wife a valuation for the family home then tell her AA is a millionaire. Her response is "no I'm married to one." The husband said that this was a joke and that all parties knew that the property belonged to the Father. This seems a peculiar joke. The husband was taken to a spreadsheet attached to the wife's statement. In that spreadsheet there was a document entitled savings [AA] and [BA]. It was put to the husband that this was a spreadsheet setting out his net assets. Husband denied this explaining that he created this document and it was used as an aide memoir when working out which properties needed to form part of his tax return. There are only five properties. The husband is not an unsophisticated man, he has a PHD. The husband was asked why the Chelsea investment trust appeared on this list, as this was an ISA. Ultimately, he accepted that this was a snapshot of the assets in his name. The husband was asked about the CoFunds account. He explained that this was opened by his father with £10,000 in 2010 and that investment income has been paid into it. His position was that the funds in the account therefore belongs to his father. Some of the funds that went into the account may well have been from the Investment property. However, allowing for a regular payment of £500 per month since the property was bought. At the most allowing for no significant repairs of void periods this would total £500 a month for 6 ½ years i.e. £39,000. Even were I to accept that the £10,000 initial investment from CA went back to CA (despite the father's own evidence), that would total £49,000. The current value of the account is £80,000. The husband provides no written evidence as to why the full balance of the CoFunds account also belong to his father. This failure to account for this discrepancy further reduces his credibility. During the course of proceedings the husband referred to the intervener's will. A copy of which has not been provided to the court. The husband's position was that if anything happened to his father then the assets owned by the Father would form part of his estate. He appeared to suggest that that is what his father wanted and he would abide by the wishes. This ran counter to CA's own evidence that the shares would belong to the people who own them, and the owner of the family home would decide what happened to the property. During the cross-examination of the wife the husband clarified his case. It was put to the wife that the intervenors covered not only the purchase price of the property but also the cost associated with buying it. The bottom line figure was therefore £766,000. The curious feature is that that is wholly and inconsistent with the husband's case that the intervenors paid for the purchase of the family home, the purchase of the investment property and the purchase of the extension over the garage and the granny annex (the estimated cost of the granny annex was £50-£60,000. On any analysis there was a shortfall between the funds allegedly received from the interveners and the money spent. This further undermines the credibility of the husband. Overall the husband was an unhelpful witness. A significant amount of information he gave to the court was heard for the first time from the witness box. He is an intelligent man, and he has run this case on behalf of himself and the intervenors. He has had access to all of the necessary documentation and has picked and chosen what he wanted to provide the court with. I am drawn to conclude that if he failed to provide the necessary documentation there is probably a reason to his advantage why he decided to do this. The wife The wife gave evidence next. She confirmed her written evidence was correct and corrected a type error in the papers. Otherwise her evidence was broadly consistent. She was fully and robustly challenged by Mr Ali and Ms Kaur (QLR) at length. The wife confirmed her view that the funds advanced by the intervenors was a mechanism to avoid inheritance tax. She explained her recollection of conversations that she had been present at, although she may not have taken part in. She understood that the payments were provided so that if anything would happen to the interveners the money would not form part of the estate. She was aware that inheritance tax was 40% that the funds had to be handed over seven years before death. Her evidence was that as a young woman, she didn't know this from any other source other than these conversations. The wife explained her understanding that the intervenors had given money to other family members of similar amounts in order to reduce potential inheritance tax duties. The wife was cross-examined about the conversations she had overheard. It was put to the wife by both the intervenors and the husband that all of the funds used to purchase the family home, the investment property and the two extensions were paid for from money given by the intervenors. That money total £866,000. The wife explained that she did not accept that the investment property was paid for entirely from the funds provided by the intervenors. She said her recollection was that there was a discussion that if husband and wife raised £80,000 then the interveners will give them a further £30,000 so that they can invest in an investment property. It was put to the wife that this was a significant change from her defence. She readily accepted that. This is an inconsistency that I will take into account. It was put to the wife that there was a further inconsistency in her account. In one of the recordings she asks for the income from four rental properties. It was put to the wife she said four rather than five because she understood that the investment property actually belonged to the intervenors. The wife's explanation was that the conversation took place in March 2024 and they were still in the process of buying the fifth investment property at that time. That appear to me to be a spontaneous and believable answer which undermines the criticism and bolstered the credibility of the wife. It was put to the wife that there was a common understanding as to the ownership of the properties. She denied this. She said that she was always led to believe that the assets belonged to her and her husband respectively. She told me that the family home was in BA's name ' but it was mine as well, but that has now flipped. ' The wife's account of the purchase of the family home was that the husband was the one who was looking for the home that had things he wanted, for example a double garage. When they visited properties, the intervenors were more keen on finding a granny flats or separate Annex that they could live in. The wife denied that she persuaded the intervenors that they were buying a family home, she said she was observant and listened to the conversations, but didn't really have a say. It was put to the wife that she sold gold for a significant amount of money. The wife denied this and appeared surprised that when she was told that the gold was sold for about £16,000. This is despite the fact that her own receipts evidence this sale price. The wife was also taken to her form E. In this document she explained that the parties had a significant standard of living, they dined out frequently and had numerous parties and lived in an expensive property. The wife's reaction was to downplay this suggesting and tell me that the eating out was actually part of a job where they receive a reimbursement for a meal if they fill in a questionnaire following eating in the restaurant. This indicates to me tendency on the part of the wife downplay allegations of misconduct or excess level against her. Whilst the wife tends to downplay her role to avoid criticism, I generally found her to be a more straightforward and honest witness than I did the intervenor or the husband. Findings of fact In this particular case the intention of the parties is everything. Was the intention of the parties, as the wife asserts, for the intervenors to divest themselves of a significant lump sum so that any transfer would be outside the reach of inheritance tax, or was the intention of the parties that be beneficial interest in the family home and investment properties remain with the intervenors. In balancing these issues I bear in mind a number of features. First of all the general credibility of the intervenor and the husband. The intervenor made sweeping generalisation about his willingness to pay tax, he told me " all the money could go to England for all he cares. " This was not consistent with his written evidence. That he wished to save money on stamp duty so put the family home in the name of the husband. I also bear in mind that the intervenors son is a chartered accountant and he is therefore more than capable of assisting his father in preparing a tax return to account for his income from the investment property. If the intervenor is to be believed and he wished to pay all the tax that was owed by him then it is difficult to see why he would allow the income for investment properties, that he claims were beneficially his, to be run through his sons accounts and the wife's tax returns. It is also difficult to see how he would allow those funds to be paid into an ISA that is not in his name. Then I turn to the financial evidence provided by the parties. I note that all parties appear to agree that the husband and CA were meticulous record keepers. The husband put to the wife on a number of occasions that he was best placed to interpret the spreadsheets because he created them. I note that the husband has effectively prepared this case for the interveners, he has had access to the intervenors documents as these were attached to the statement he prepared. I would therefore expect, against that background, the account of how properties were purchased to be accurate clear and easily understandable. It is not. The husband has chosen not to produce any evidence of how he utilise the funds provided by the intervenors. The reason for this is because his version of events simply does not add up. Taking a broad brush approach the husband's case is that the interveners paid: £766,000 for the family home, £93,000 for the investment property £50-£60,000 for the annex An unknown sum for the garage conversion This totals £909,000 - £919,000 (with a further sum for the garage conversion.) When the figures are considered in slightly more detail the position appears to unravel further. By the 13 th of November 2017 the interveners had transferred £659,800 to the husband. This is a full £100,000 short of the sum required to purchase the family home. By the end of 2019 the intervenors had transferred £769,800 to the husband. These funds were, according to the husband and intervenors used to buy the family home £766,000, the investment property £93,000 and to pay for the works undertaken above the garage. It simply does not add up. It appears to be just sufficient to fund the purchase of the family home, but it is insufficient to fund the garage works and the purchase of the investment property. This evidence runs entirely counter to the husband's clear assertion that when works were needed to be done to the family home he told his father he must pay for them as it is his house. When I then return to the question of why the husband has failed to provide evidence of how the intervenors money was spent the answer becomes obvious, it's because it would have provided clear evidence that his (and the intervenors) pleaded case is inaccurate. I then consider what evidence there is to support either party's version of events. I add to the wife's side of the scales the fact that it is conceded that nowhere in the paperwork for the purchase files of the family home or the investment property do either of the intervenors' names appear. That again is peculiar, if everything were intended to be entirely transparent, I would have expected the solicitor to have a letter or confirmation from the intervenor explaining that they were the source of the purchase funds, but that is absent. The intervenor and husband both seek to criticise the wife for an inconsistent approach to the assets in this case, varying between asserting that the investment property was bought with intervenor funds and then later marital funds. This criticism rings particularly hollow, the intervenors case was that they never discussed money with the wife, my note of the husband's own evidence was " I never discussed [the investment property purchase with the wife].. I said sign this TR1 etc, she not aware of what doing, she not aware of all the transactions that took place. I get a tenant to rent out, ex wife signed the forms and I deal with the rest ". The wife largely agreed with that, with the caveat that whilst she was not involved in the discussions she was listening to what was spoken about. Far from being inconsistent, I would have expected the wife to have very little knowledge about how various properties were funded. I do not view this as an inconsistency that materially affects the wife's credibility. I add to the wife's side of the balance sheet the fact that her account of a conversation appears to be supported by the figures set out at paragraph 65 above. The wife told me in evidence that she heard a conversation where CA offered to provide £30,000 if the husband could raise £80,000 to buy an investment property. It is apparent from my analysis above that that there was a shortfall between that which the intervenors provided and the funds required to buy both properties and undertake all the necessary works. By my calculations the interveners would have needed to provide £859,000 for the purchase of both the family home and the investment property. That leaves £7,300 for a garage conversion and ground floor annex. The short fall figure in the region of £80,000. On this basis I accept this calculation of corroborative evidence that the wife had heard this conversation and accurately described this to the court. I add to the intervenors side of the balance the presumption that paying towards a property can establish a common intention trust. However, this is a rebuttable presumption and only where there is no evidence of the real intention between the parties. The lack of credibility of the husband and intervenor, coupled with the fact their figures do not tally significantly erodes this presumption. When I consider all of the features of this case, the lack of credibility of the intervenor and the husband, and the overall timing of the transfers, the fact that the intervenor now has a level of savings close to the inheritance tax threshold. I am satisfied that the purchase of the family home was undertaken in an attempt to shield the intervenors funds from inheritance tax. It is clear that works were done to the property, however, the costs of these works remains unclear. The intervenors written case is that they paid funds between 2020 and 2022 to pay for improvements in the house. These cheques total £43,000. The husband's case is that the downstairs extension cost between £50-£60,000 alone. I can not be certain how much the extensions have ultimately cost as the intervenors have chosen not to attach any evidence for costings, and the husband has chosen not to provide any evidence as to how the building works were funded, i.e. copy bank statements, invoices etc. In respect of investment property, the evidence provided by the intervenors fails to demonstrate that they had contributed sufficient funds to enable the property to be bought with the intervenors funds. The income from the investment property was paid into the husband's CoFunds account. There is no information in the property file to suggest that the intervenors had any interest in this property, and further the husband asserts that this was funded from his savings. The intervenors have claimed £8,000 for the purchase of shares. This is calculated on the basis that the intervenors gave the husband £8,000 to purchase shares and that the funds were not returned when the share purchase concluded. The parties accept that the shares exist, but the wife has no knowledge of when or whether the husband failed to return the balance. The husband and intervenors have failed to produce any evidence of the funds in the husband's account. Their lack of credibility coupled with the intervenors evidence that he would give his children money and it was up to them if they repaid this also doe not permit me to find that the £8,000 was the subject of an agreement to repay. The common intention I have considered the totality of the evidence. I am satisfied that the intention of the intervenors and the husband was for the intervenors to provide funds to the husband in order for them to be placed outside the reach of inheritance tax. The fact that these were utilised for the purchase of a family home does not alter the fact that for this intention to be achieved the payments needed to be an absolute gift. As outlined above, the rationale for this decision is that: The husband and intervenors lacked credibility; The intervenor was inconsistent in his approach to tax efficiency; The intervenors names do not feature in either of the property purchase files; The intervenor has reduced his current asset base to close to the IT threshold; The intervenor and husband failed to provide clear and compelling evidence as to how the funds provided were utilised; and The wife was a credible witness, I accepted her account of the conversations she said she heard relating to IT planning; Therefore, far from the Intervenors acting to their detriment, they provided these funds in order to try and obtain an advantage for their children by mitigating their inheritance tax obligations. Did the intention of the parties change over time? The intervenors claim that they invested further sums into the family home in order to renovate and improve the property. I do not accept that this changed the essential purpose of the transfer of funds. Had it been intended that the renovation and extension works should give rise to an interest in the property then that would have undone the common intention that the funds were provided as a part of inheritance tax planning. I am therefore satisfied that there was no common intention that the intervenors should have an interest in the family home. I find as a fact that the property and renovation works were in large part funded by the intervenors as an advance on inheritance and will be treated as such for the purposes of the financial remedy proceedings. The Investment property The intervenors claim to have funded the purchase of the investment property. The onus of proving this rests on the intervenors. As set out above, at the time that the property was purchased the intervenors evidence was that they had provided £769,800 to the husband. This sum would only allow £3,800 to go towards the purchase of the investment property. I also note that the purchase file noted that the funds to purchase the investment property came from the husband and wife's savings. On the basis of the totality of the evidence the intervenors have failed to demonstrate that their funds were utilised to purchase the investment property. I am satisfied and find as a fact that this property was purchased from the savings of the husband and wife. The investment property was purchased in the name of the wife. I prefer the evidence of the wife and accept that there was no common intention that the intervenors should have any beneficial interest in this asset. It therefore follows that the income from the investment property, which was directed to the CoFunds account, are not beneficially owned by the intervenors. The funds in the CoFunds account are matrimonial assets, as is the investment property. The Shares I am also satisfied on the evidence of CA that the loans he made to his children were at best soft family loans. There was no obligation to repay these funds and no terms to the repayment. He accepted that if they repaid the money that was a matter for his children. These terms make these payments as close to a gift as it is possible to get without the moral family pressure to repay the money. The intervenors have provided some evidence that they sent funds to Saga and Royal Mail for share purchases. Even were I to accept the intervenors position that the over payment was not returned to them, it appears that this would fall under the category of a soft loan. I do not accept that there was a clear agreement that any overpayment should be returned. Finally, the shares themselves are held by the applicant and respondent. CA accepted that these were the property of the husband and wife respectively. The curious feature of these assets is that there was an agreement that the dividend income would be paid to CA. I am told that this has occurred. In my judgment the agreement between the parties was that so long as the parties held the shares they would pay any dividend income to CA, however, it was and remains open to the parties to sell these shares when they wish. It is thereafter a matter for the parties as to whether they repay the value of the shares to CA, as per his stated position. Judgment The intervenors claim is dismissed. The intervenors shall pay the costs of the wife of and incurred as a result of this application. District Judge Sundstrem-Brown st August 2025 BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII