• Transfer made so Mrs N could later obtain Defence Services Homes Act (DSHA) loan at preferential rates. • When applied for DSHA loan, falsely declared had no financial interest in other property. • When house sold, Mrs N claimed entitled to proceeds of sale, as presumption of advancement rebutted. • E claimed presumption of advancement could not be rebutted by mother using illegal conduct as basis of claim.
Topic 12 – Resulting Trusts Equity & Trusts 70517 Nelson v Nelson (1995) 184 CLR 538 per Deane & Gummow JJ • A question in the present case … arises as to whether the trust in respect of the proceeds of sale which Mrs N asserts … is tainted by illegality because of its association with or furtherance of a purpose which is contrary to the policy of the law… • In our view, as the price of obtaining the relief she seeks for the recognition and enforcement of a RT …, Mrs N must be prepared to do equity according to the requirements of good conscience. • Mrs N not debarred by illegal conduct from claiming proceeds of first house based on purchase money RT. • Majority – if Mrs N did not repay amount equal to benefit to Cth, proceeds should be held on trust for E & Mrs N. • Mrs N could not use equitable principles relating to RTs to obtain fruits of illegal conduct.
Patel v Mirza  Tinsley v Milligan ‘reliance test’ – party to illegal contract cannot enforce claim if has to rely on illegal conduct as element of claim. Rejected by majority of UKSC in Patel v Mirza. Court should make flexible assessment of whether public interest would be harmed by enforcement of illegal contract. Relevant factors: (1) underlying purpose of prohibition; (2) public policy; & (3) whether denial of claim would be proportionate, bearing in mind punishment for illegality is a matter for the criminal courts.
Topic 12 – Resulting Trusts Equity & Trusts 70517 Next lecture …
Equity & Trusts 70517 Topic 1 - History and Nature of Equity Topic 2 - Unconscionable Dealing and Undue Influence Topic 3 - Introduction to Estoppel/ Proprietary Estoppel Topic 4 - Promissory Estoppel Topic 5 - Equitable Interests/ Equit’l Assignment of Property Topic 6 - Equitable Assignment of Property Topic 7 - Fiduciary Obligations Topic 8 - Accessorial Liability for Breach of Fiduciary Duty or Trust Topic 9 - Tracing/ Account of Profits Topic 10 - Equitable Compensation Topic 11 - Constructive Trusts Topic 12 - Resulting Trusts Topic 13 - Express Trusts Topic 14 - Duties, Powers, Rights and Liabilities of Trustees; Rights of Beneficiaries
Equity & Trusts 70517 End of lecture
You've reached the end of your free preview.
Want to read all 75 pages?
- One '14
- Wills and trusts, Trust law, Express Trusts