Geary v Rankine [2012]
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Geary v Rankine [2012] EWCA Civ 555 is a significant English land law case concerning the establishment of constructive trusts in relation to beneficial interests in a business enterprise between romantic partners. The case revolves around the absence of formal agreements, direct financial contributions, and formal wages in a guest house venture.
The case involves Mrs Geary and Mr Rankine, who entered a romantic relationship in 1990. In 1996, Mr Rankine purchased a guest house with his savings. Initially, the plan was for the property to be managed by someone else, but managerial issues prompted Rankine to take over. Mrs Geary actively participated in the business without receiving formal wages. The relationship soured, leading Geary to claim a beneficial interest in the guest house through either a business partnership or a constructive trust.
The initial judgment rejected Geary's claim, prompting her appeal. The Court of Appeal, considering the legal title solely in Rankine's name, analysed the question of whether there was a common intention for Geary to possess a beneficial interest. Referring to Jones v Kernott [2011], the court emphasised an objective evaluation of the parties' conduct. While a common intention to run the business together was acknowledged, extending this to a common intention about property ownership was deemed impermissible. The court concluded that Geary failed to establish a constructive trust.
Lewison LJ's closing statement highlighted the impermissibility of assuming a common intention for property ownership based on the common intention to run a business together. Geary's evidence, including Rankine's refusal to recognise her until divorce and his reluctance to grant security for her and her son, was considered inconsistent with an intention for her to have a beneficial interest in the property.
This case underscores the need for clarity in establishing beneficial interests in business ventures, especially in the absence of formal agreements. The case emphasises the importance of objective evaluations of common intentions and highlights the challenges of extending partnership expectations to property ownership without explicit agreements.
In summary, this case contributes valuable insights into the realm of constructive trusts, particularly within business enterprises involving romantic partners. The case serves as a reminder of the nuanced assessments required when determining beneficial interests in the absence of formal documentation and the significance of parties' conduct in shaping legal outcomes.
The case involves Mrs Geary and Mr Rankine, who entered a romantic relationship in 1990. In 1996, Mr Rankine purchased a guest house with his savings. Initially, the plan was for the property to be managed by someone else, but managerial issues prompted Rankine to take over. Mrs Geary actively participated in the business without receiving formal wages. The relationship soured, leading Geary to claim a beneficial interest in the guest house through either a business partnership or a constructive trust.
The initial judgment rejected Geary's claim, prompting her appeal. The Court of Appeal, considering the legal title solely in Rankine's name, analysed the question of whether there was a common intention for Geary to possess a beneficial interest. Referring to Jones v Kernott [2011], the court emphasised an objective evaluation of the parties' conduct. While a common intention to run the business together was acknowledged, extending this to a common intention about property ownership was deemed impermissible. The court concluded that Geary failed to establish a constructive trust.
Lewison LJ's closing statement highlighted the impermissibility of assuming a common intention for property ownership based on the common intention to run a business together. Geary's evidence, including Rankine's refusal to recognise her until divorce and his reluctance to grant security for her and her son, was considered inconsistent with an intention for her to have a beneficial interest in the property.
This case underscores the need for clarity in establishing beneficial interests in business ventures, especially in the absence of formal agreements. The case emphasises the importance of objective evaluations of common intentions and highlights the challenges of extending partnership expectations to property ownership without explicit agreements.
In summary, this case contributes valuable insights into the realm of constructive trusts, particularly within business enterprises involving romantic partners. The case serves as a reminder of the nuanced assessments required when determining beneficial interests in the absence of formal documentation and the significance of parties' conduct in shaping legal outcomes.
