Rochefoucauld v Boustead
Equity will not allow the statute requiring writing for trusts of land to be used as an instrument of fraud, so an oral trust of land may be enforced against the trustee.
Facts
The Comtesse de la Rochefoucauld owned coffee estates in Ceylon, which were mortgaged. Mr Boustead bought the estates from the mortgagee, under an oral agreement with the Comtesse that he would hold them on trust for her, subject to repayment of what he had paid. He later sold the estates and claimed to be entitled to keep the proceeds, relying on the Statute of Frauds, which required declarations of trusts of land to be evidenced in writing.
Legal principle
The Court of Appeal held that Mr Boustead held the estates on trust for the Comtesse. Lindley LJ said that the Statute of Frauds does not prevent the proof of a fraud, and that it is a fraud on the part of a person to whom land is conveyed as a trustee, and who knows it was so conveyed, to deny the trust and claim the land himself. The court would therefore allow the trust to be proved by oral evidence. The principle now applies to section 53(1)(b) of the Law of Property Act 1925.
Related cases on formalities and constitution of trusts
- Re Brooks' Settlement Trusts [1939] Ch 993
- Cannon v Hartley [1949] Ch 213
- Choithram (T) International SA v Pagarani [2001] 1 WLR 1
- Fletcher v Fletcher (1844) 4 Hare 67
- Grey v IRC [1960] AC 1
- Hodgson v Marks [1971] Ch 892
- King v Dubrey [2015] EWCA Civ 581, [2016] Ch 221
- Mascall v Mascall (1984) 50 P & CR 119
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