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Lloyds Bank v Rosset [1991] 1 A.C. 107

Land Law – Trusts – Cohabitees – Constructive Trusts – Land Registration Act 1925 – Property – Equity – Common Intention – Beneficial Interest

Facts

The defendant, Mrs Rosset, was married to Mr Rosset, who was the sole registered owner of the property in question. Mr Rosset had bought this house with his family trust money, which had insisted on his sole ownership as a condition for using that money. Mr Rosset had secured a loan against the property from the complainant’s, Lloyds Bank. The defendant had helped in the building work and decorating of the property. However, Mr Rosset defaulted on his payments and the complainants sought repossession of the property.

Issues

The appeal concerned whether the defendant had a beneficial interest in the house and if she was entitled to stay in the property under section 70(1)(g) of the Land Registration Act 1925. The complainants argued that Mrs Rosset did not have rights in the property and her renovations did not allow equitable rights in the property to arise.

Held

It was held that the defendant did not have a beneficial interest in the property. Mrs Rosset did not make any financial contributions in buying the property nor for the renovations; she had only helped with the physical building and redecorating of the house. There was no discussion or agreement between Mr Rosset and Mrs Rosset regarding the ownership of the property and without express agreement, there could be no beneficial interest for the common intention needed to form a constructive trust. Mrs Rosset’s work on the house was not enough to form an equitable interest. Thus, the complainants were successful.


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