Tinsley v Milligan [1993]
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Tinsley v Milligan [1993] UKHL 3 is a significant English trusts law case that deals with resulting trusts, the presumption of advancement, and the complex intersection of these principles with issues of illegality in a contractual context. The decision was later overruled by Patel v Mirza in 2016.
Miss Tinsley sought possession of a house that was registered solely in her name. Her former partner, Miss Milligan, had contributed to the purchase price, but the property had been intentionally registered in Tinsley's name alone to maximise social security benefits. After their relationship ended, Tinsley moved out and claimed sole entitlement to the property. Milligan argued that there was a common intention that the property belonged to both of them, and she did not rely on the illegality of the initial arrangement.
The House of Lords held that Miss Milligan could invoke the presumption of a resulting trust without relying on the illegal purpose of the initial arrangement. As a result, she was deemed to have a share in the house. The burden shifted to Miss Tinsley to demonstrate her intention to defraud the social security system in order to rebut the presumption of a resulting trust and secure sole ownership. Lord Browne-Wilkinson emphasised that a plaintiff could establish an equitable interest without relying on the underlying illegal transaction, as long as the presumption of advancement did not apply.
Lord Browne-Wilkinson's statement highlighted that in cases where the presumption of advancement doesn't apply, a plaintiff can establish an equitable interest without directly invoking the illegality. Milligan, as the defendant, could plead the common intention of joint ownership and her contribution to the purchase price without relying on the illegal purpose. The judgments did not consider the clean hands doctrine despite the central plan involving fraudulent claims for social security payments.
Interestingly, the House of Lords did not explore the clean hands doctrine, a principle asserting that those seeking equity must approach the court with clean hands. Despite the fraudulent aspect of the social security plan, the court focused primarily on the question of illegality in a contractual context.
Tinsley v Milligan, criticised for creating capricious results, was later overruled by Patel v Mirza in 2016 which introduced a more nuanced approach to the illegality defence and emphasised a broader consideration of public interest and policy factors when assessing claims involving illegal agreements.
Miss Tinsley sought possession of a house that was registered solely in her name. Her former partner, Miss Milligan, had contributed to the purchase price, but the property had been intentionally registered in Tinsley's name alone to maximise social security benefits. After their relationship ended, Tinsley moved out and claimed sole entitlement to the property. Milligan argued that there was a common intention that the property belonged to both of them, and she did not rely on the illegality of the initial arrangement.
The House of Lords held that Miss Milligan could invoke the presumption of a resulting trust without relying on the illegal purpose of the initial arrangement. As a result, she was deemed to have a share in the house. The burden shifted to Miss Tinsley to demonstrate her intention to defraud the social security system in order to rebut the presumption of a resulting trust and secure sole ownership. Lord Browne-Wilkinson emphasised that a plaintiff could establish an equitable interest without relying on the underlying illegal transaction, as long as the presumption of advancement did not apply.
Lord Browne-Wilkinson's statement highlighted that in cases where the presumption of advancement doesn't apply, a plaintiff can establish an equitable interest without directly invoking the illegality. Milligan, as the defendant, could plead the common intention of joint ownership and her contribution to the purchase price without relying on the illegal purpose. The judgments did not consider the clean hands doctrine despite the central plan involving fraudulent claims for social security payments.
Interestingly, the House of Lords did not explore the clean hands doctrine, a principle asserting that those seeking equity must approach the court with clean hands. Despite the fraudulent aspect of the social security plan, the court focused primarily on the question of illegality in a contractual context.
Tinsley v Milligan, criticised for creating capricious results, was later overruled by Patel v Mirza in 2016 which introduced a more nuanced approach to the illegality defence and emphasised a broader consideration of public interest and policy factors when assessing claims involving illegal agreements.
