Kingsnorth Finance Co Ltd v Tizard [1986]

Kingsnorth Finance Co Ltd v Tizard [1986] 1 WLR 783 addressed the significance of a wife's beneficial interest in the matrimonial home and its impact on a purchaser for value who failed to conduct adequate inspections before acquiring the property. The central issue was whether the wife's beneficial interest in the property constituted constructive notice for the purchaser, considering the defendant's failure to conduct thorough investigations.

A married couple jointly contributed to the purchase of a property intended to be their matrimonial home. The husband, however, took sole legal title to the property at the time of registration. As the marriage deteriorated, the wife ceased full-time occupation of the property but continued to visit daily to care for their children and occasionally spent the night when the husband was absent.

Subsequently, the husband, falsely claiming to be single, mortgaged the property and arranged for an inspection by the defendant. The inspection was scheduled when the husband knew the house would be vacant. During the inspection, no evidence of the wife's presence was found, and the husband stated that she had stopped living there months earlier. However, the inspector did note the presence of children in the property.

The court held that the wife's beneficial interest should serve to bind the defendant under the doctrine of notice. The husband's application contained inconsistencies with the inspection results, and the defendant failed to make further inquiries about these inconsistencies. Additionally, the inspection was arranged at a time convenient for the claimant (husband), suggesting a lack of diligence on the defendant's part.

The court determined that the defendant had not fulfilled its duty to take all reasonable steps to discover any beneficial interests in the property, and as a result, constructive notice applied. This decision marked a departure from the previous approach in Caunce v Caunce [1969], where a similar claim by Mrs Tizard might not have been successful.

In summary, Kingsnorth Finance Co Ltd v Tizard established the principle that a purchaser for value could be bound by a wife's beneficial interest in a matrimonial home if adequate inspections were not carried out, emphasising the importance of thorough due diligence in property transactions.
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