As discussed in a number of our previous blogs, a common intention constructive trust requires two elements to be established:
(1) a common intention to share ownership of a property; and
(2) detrimental reliance that significantly altered his/her position.
The conceptual difficulty with identifying these two elements when one of the parties is a minor is that he/she will lack capacity until the age of 18 years old in the eyes of the law. Can a common intention constructive trust be held for a minor through the agency of an adult (with mental capacity) acting on behalf of the minor? The recent case of Fox and Bridge (in their capacity as joint trustees in bankruptcy of Marcus Nathan Bent) v Bent and others [2024] EWHC 2179 (Ch) has brought some clarity to a situation like this.
Fox and Bridge v Bent and others
Background
Mr Bent was made bankrupt in January 2019. The Court found an agreement was entered into between Mr Bent and his former partner and mother of the couple’s daughter, namely Ms Clark, (Agreement) which gave rise to a common intention constructive trust in favour of the daughter.
The Agreement provided that a property purchased by Mr Bent in his sole name was to be held on trust by Mr Bent until the daughter reached the age of 18 at which point she would be entitled to become the owner of the property. Therefore, the property would not form part of Mr Bent’s estate in bankruptcy and the trustees in the bankruptcy could not claim for possession of the property and/or an order for its sale.
The trustees in the bankruptcy appealed that decision arguing that the Court was wrong to find the common intention constructive trust given that the daughter was a minor, more specifically, two years old at the time when the constructive trust was said to have come into existence.
Decision
The Appeal Court dismissed the trustee’s application for the following reasons and, affirmed the existence of a common intention constructive trust:
1. Detrimental reliance could be through an agent, who is Ms Clark in this case. The reason why this element is required is because it would be inequitable to deny a beneficial interest in the land. The actions of Ms Clark taken on behalf of the daughter were sufficient to establish that the daughter had suffered detriment in reliance upon the agreement; and
2. The Court would not conduct a rehearing of the issue in the trial, especially given that nothing indicated that the trial judge made an error that would permit the Court to interfere with the finding.
Comment
This case confirms that, where the minor is acting through the agency of a parent or other adult party (with mental capacity), there is no conceptual difficulty in either common intention or detrimental reliance being established, subject to such a detriment being proven.
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Ronny Tang is an Associate in our expert Dispute Resolution team, specialising in defamation claims, contentious probate and inheritance claims, Trusts of Land and Appointment of Trustees Act 1996 claims, Equality Act 2010 claims and Protection From Harassment 1997 claims.
If you need any advice concerning the subject discussed in this article, please do not hesitate to contact Ronny or another member of the team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online enquiry form.
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