Key Facts
- •Mr. Waites provided £230,000 for the purchase of land, registered in Mrs. Karpaviciene's name.
- •The parties intended to develop the land jointly, with profits split equally.
- •The purchase price was described as a loan to avoid stamp duty.
- •The joint venture failed, and Mr. Waites claimed ownership of the land.
- •The lower court ruled in favor of Mr. Waites, declaring him the sole legal and beneficial owner.
Legal Principles
Resulting trust: A trust implied by law where a person provides the purchase money for property but the property is transferred to another.
Westdeutsche Bank v Islington LBC [1996] 2 WLR 806
Illegality: Courts will not assist a claimant who must rely on their own illegality to establish their claim.
Tinsley v Milligan [1994] 1 AC 340, Patel v Mirza [2016] UKSC 42
The 'reliance' principle from Tinsley v Milligan has been modified by Patel v Mirza, adopting a more flexible approach to whether illegality should bar a claim.
Patel v Mirza [2016] UKSC 42
Substance over form: The true nature of a transaction is determined by its substance, not merely the labels attached by the parties.
Gascoigne v Gascoigne [1919] 1 KB 223, In re Emery's Investment Trusts, Emery v Emery [1959] 1 Ch 410, Tinker v Tinker [1970] 1 All ER 540
Outcomes
Appeal dismissed.
The court found that the judge correctly disregarded the parties' attempt to label the transaction as a loan to avoid stamp duty and correctly applied the resulting trust principle.