Hussey v Palmer
Money paid to build an extension on another person's house for the payer to live in was held on trust for the payer when the arrangement ended.
Facts
Mrs Hussey, an elderly widow, was invited by her daughter and son in law to live with them. She paid about £600 for an extension to be built on their house, in which she would live. After a family quarrel, she left, and asked for her money back. She argued that it was a loan, or that the money was held on trust for her.
Legal principle
The Court of Appeal, by a majority, held that the son in law held the house on trust for Mrs Hussey to the extent of her payment. Lord Denning MR said that the trust was a constructive trust imposed by law whenever justice and good conscience require it, which he called a new model constructive trust. Phillimore LJ said that the trust was a resulting trust. Cairns LJ dissented, holding that the money was a loan. Lord Denning's approach to constructive trusts was later rejected.
Related cases on resulting trusts
- Re Abbott Fund Trusts [1900] 2 Ch 326
- Air Jamaica Ltd v Charlton [1999] 1 WLR 1399
- Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567
- Bennet v Bennet (1879) 10 Ch D 474
- Dyer v Dyer (1788) 2 Cox Eq 92
- Fowkes v Pascoe (1875) LR 10 Ch App 343
- Re Gillingham Bus Disaster Fund [1958] Ch 300
- Laskar v Laskar [2008] EWCA Civ 347, [2008] 1 WLR 2695
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