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England and Wales decisions
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The land was not gifted to the Second Respondent; it was placed in his name to avoid Stamp Duty. The Second Respondent holds legal title but beneficial ownership is jointly held by the Applicant and Respondent under a constructive trust, alternatively a resulting trust. Illegality in Stamp Duty evasion does not bar the trust claim.
Source excerpt
The Court of Appeal upheld a declaration that a home was held on trust in equal shares, finding a common intention to share and no need to rely on illegality.
O'Kelly v Davies [2014] EWCA Civ 1606 (11 December 2014)
Court of Appeal dismissed an appeal over beneficial ownership of 74 Lon Olchfa, holding the respondent did not need to rely on illegality to prove a constructive trust.
The High Court held that 36 BR had been promised to H in return for major renovation work and expenditure, giving rise to proprietary estoppel and requiring transfer of the property.
Barrett v Barrett [2008] EWHC 1061 (Ch) (19 May 2008)
Appeal dismissed. The court held that Thomas Barrett’s claimed beneficial interest failed because it depended on an arrangement made to conceal the interest from his trustee in bankruptcy.
The court dismissed an appeal over a claimed trust in a former family home, holding the claim was unenforceable because it depended on an illegal purpose linked to bankruptcy concealment.
Collier v Collier [2002] EWCA Civ 1095 (30 July 2002)
The Court of Appeal held that the father could not enforce an alleged trust over property transferred to his daughter because doing so would require reliance on the parties’ illegal purpose.
Mortgage Express v McDonnell [2001] EWCA Civ 887 (22 May 2001)
The Court of Appeal held that illegality did not bar Mrs McDonnell’s equitable interest claim and allowed Mortgage Express subrogation only to the extent of the prior bank charge.
Lowson v Coombes [1998] EWCA Civ 1849 (26 November 1998)
Court of Appeal held that an unmarried partner could claim a half beneficial interest in a home held in the other partner’s sole name, despite the illegal purpose behind the transfer.
Tribe v Tribe [1995] EWCA Civ 20 (26 July 1995)
The Court of Appeal held that shares transferred to a son to shield them from creditors could be recovered because the illegal purpose was never carried out.
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