Paul v Constance [1976]
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Paul v Constance [1976] EWCA Civ 2 is significant in English trusts law, particularly in establishing the requirements for the three certainties needed to create a valid trust.
Mr Constance and Ms Paul were in a relationship, and Mr Constance received damages from a workplace accident. He deposited the money into a joint account, despite the account being in his sole name. Over time, they made joint contributions to the account, including winnings from bingo. When Mr Constance passed away without a will, a dispute arose between Ms Paul and Mrs Constance over the ownership of the money in the account.
The Court of Appeal, led by Scarman LJ, held that the words and conduct of the parties demonstrated Mr Constance's intention to create a trust for both himself and Ms Paul. Scarman LJ emphasised the need to consider the unsophisticated nature of the parties and their understanding of their domestic situation. The court accepted that Mr Constance's repeated statement, "This money is as much yours as mine," constituted a present declaration of trust.
Bridge LJ concurred with Scarman LJ, citing Richards v Delbridge and emphasising that while specific words like "I declare myself a trustee" are not necessary, the settlor must do something equivalent to it. The court must interpret expressions used by the settlor according to their proper meaning.
This case underscores the importance of analysing the words and actions of the settlor in their specific context to determine the intention to create a trust, establishing the first certainty required for a valid trust.
Mr Constance and Ms Paul were in a relationship, and Mr Constance received damages from a workplace accident. He deposited the money into a joint account, despite the account being in his sole name. Over time, they made joint contributions to the account, including winnings from bingo. When Mr Constance passed away without a will, a dispute arose between Ms Paul and Mrs Constance over the ownership of the money in the account.
The Court of Appeal, led by Scarman LJ, held that the words and conduct of the parties demonstrated Mr Constance's intention to create a trust for both himself and Ms Paul. Scarman LJ emphasised the need to consider the unsophisticated nature of the parties and their understanding of their domestic situation. The court accepted that Mr Constance's repeated statement, "This money is as much yours as mine," constituted a present declaration of trust.
Bridge LJ concurred with Scarman LJ, citing Richards v Delbridge and emphasising that while specific words like "I declare myself a trustee" are not necessary, the settlor must do something equivalent to it. The court must interpret expressions used by the settlor according to their proper meaning.
This case underscores the importance of analysing the words and actions of the settlor in their specific context to determine the intention to create a trust, establishing the first certainty required for a valid trust.
