Express declaration of trust is conclusive
In Stack v Dowden, Baroness Hale said that an express declaration of trust in an assignment to co-owners is conclusive as between the parties.
She went on, however to say that the declaration could be varied by subsequent agreement or be affected by proprietary estoppel (Stack, [49]).
The question in Nilsson v Cynberg ([2024] EWHC 2164) was whether the subsequent agreement in question had to satisfy the formalities requirements of the Law of Property (Miscellaneous Provisions) Act 1989 (or of section 3 of the Conveyancing and Property Ordinance in Hong Kong).
Facts
In Nilsson, Mr. and Mrs. Cynberg were joint tenants of the family home, having declared in the transfer to them that they were beneficial joint tenants.
The relationship broke down. Mr. Cynberg left the property, telling his wife that she could have the property if she left it to their children in due course.
From then on, Mrs. Cynberg met all the expenditure relating to the property (including the mortgage repayments). She used an inheritance to carry out various minor works at the property.
Mr. Cynberg was declared bankrupt and his trustee in bankruptcy claimed Mr. Cynberg’s interest in the property.
Mrs. Cynberg argued that she was the sole beneficial owner under a common intention constructive trust or through proprietary estoppel.
The informal agreement varied the express declaration
Mrs. Cynberg succeeded; the informal agreement gave rise to a common intention constructive trust which was effective to vary the initial express declaration:
‘an express declaration of trust is capable of being overridden by a subsequent agreement (Stack v Dowden). As to what is meant by “subsequent agreement” … while of course this can include a formal agreement which complies with the requirements of LP(MP)A 1989, in my judgment it … may include a common intention constructive trust’ ([48] James Pickering KC DHJC).
Michael Lower
**Disclaimer**: The information provided on the Hong Kong Land Law blog is for educational purposes only. It is intended to offer a general understanding of the cases or issues discussed, not to provide specific legal advice. Readers should not act upon this information without seeking professional legal advice. The views expressed are my own and do not necessarily reflect the official policy or position of any court or legal authority.