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Jones v Kernott
Factual and Procedural Background
The Appellant and the Respondent co-habited from the early 1980s until 1993 and had two children. In 1985 they purchased a house at [Number] Main Street for £30,000, taking the legal title in their joint names without an express declaration of trust. The Appellant provided the entire £6,000 deposit from the sale of her previous home; the balance was funded by a joint endowment mortgage. During cohabitation the Respondent contributed £100 per week towards household expenses and supplied labour for an extension that increased the property’s value.
The Respondent left the family home in 1993 and, in 1996, bought his own property using the proceeds of a joint life policy that the parties had encashed. From 1993 onwards the Appellant alone serviced the mortgage and all outgoings on the family home and received minimal child maintenance from the Respondent.
In 2007 the Appellant sought a declaration under the Trusts of Land and Appointment of Trustees Act 1996 that she owned the entire beneficial interest. The County Court judge (Judge Dedman) held that the parties’ common intention had altered after separation and awarded 90 % of the beneficial interest to the Appellant and 10 % to the Respondent. The High Court affirmed. The Court of Appeal (majority) restored equal shares, holding that no change of intention could be inferred or imputed. The Supreme Court granted permission and now decides the appeal.
Legal Issues Presented
- Whether, in a joint-name purchase without an express trust, the parties’ common intention as to their beneficial shares can change over time and, if so, how that change is to be identified.
- Whether a court may impute (as opposed to merely infer) a common intention about altered shares when direct evidence of such intention is lacking.
- What methodology should be applied to quantify the parties’ respective beneficial interests once a change of intention is established.
Arguments of the Parties
Appellant's Arguments
- The parties’ conduct after separation—particularly the Respondent’s purchase of a separate home and cessation of contributions—shows a common intention that the original joint tenancy in equity be varied.
- Even if no actual intention can be inferred, the court should impute a fair division reflecting the whole course of dealings, which justifies a 90 / 10 split.
- Preserving a strict presumption of equal ownership would produce an unjust windfall for the Respondent, contrary to established equitable principles.
Respondent's Arguments
- The presumption that equity follows the law in joint-name cases was never displaced; there was no express or inferred agreement to change shares.
- The Court should not impute intentions the parties never held; Stack v Dowden does not authorise such an approach.
- The extension work and initial weekly contributions support an equal division, and post-separation events are irrelevant to pre-existing beneficial interests.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Stack v Dowden [2007] UKHL 17 | Presumption that joint legal ownership implies joint beneficial ownership; possibility of rebuttal via whole-course-of-dealing analysis. | Primary authority; Court clarified and applied its principles, emphasising that presumption can be displaced and that imputation is permissible in limited circumstances. |
| Gissing v Gissing [1971] AC 886 | Concept of common-intention constructive trusts and objective deduction of parties’ intentions. | Cited to support objective assessment of parties’ conduct and to discuss inference versus imputation. |
| Pettitt v Pettitt [1970] AC 777 | Early rejection of rigid resulting-trust presumptions in domestic contexts. | Used to illustrate shift away from presumptions based solely on financial contributions. |
| Oxley v Hiscock [2005] Fam 211 | Court may impute shares that are “fair having regard to the whole course of dealing” when actual intention on proportions is unascertainable. | Approved as authority for imputing a fair share (90/10) where precise common intention on proportions could not be inferred. |
| Midland Bank v Cooke [1995] 4 All ER 562 | Holistic approach to quantifying beneficial interests in the family home. | Quoted to emphasise that equity must accommodate relational trust and informality in domestic settings. |
| Grant v Edwards [1986] Ch 638 | Need for clear evidence before varying presumed beneficial ownership. | Referenced in discussing limits of inference and the heavy burden on a party seeking to displace presumptions. |
| Lloyds Bank v Rosset [1991] 1 AC 107 | High threshold for inferring common intention absent express agreement. | Distinguished as too restrictive for modern domestic-ownership disputes. |
| Abbott v Abbott [2007] UKPC 53 | Affirmation that constructive-trust analysis applies equally to married and unmarried couples. | Relied on to reinforce abandonment of resulting-trust presumptions in family-home cases. |
Court's Reasoning and Analysis
Judge Walker and Judge Hale delivered a joint judgment restoring the trial judge’s 90 / 10 division. The Court reasoned as follows:
- Starting Presumption: Joint legal ownership presumptively means joint beneficial ownership, but this is rebuttable.
- Change of Common Intention: The parties’ post-separation conduct—especially the Respondent’s purchase of a separate house funded by proceeds formerly earmarked for the joint home and his complete cessation of contributions—objectively demonstrated a shared decision that future equity growth in the family home would belong almost entirely to the Appellant.
- Inference vs. Imputation: Although preference is given to inferring actual intention, equity may impute an intention where necessary to achieve a fair outcome. Here, the evidence permitted an inference; imputation served only as a confirmatory tool.
- Quantification: Applying the “whole-course-of-dealing” test (per Oxley), the Court found that a 90 % share to the Appellant accurately reflected her sole funding of the property for 14+ years, her larger capital input, and her responsibility for child care and outgoings, while the Respondent had realised an independent capital gain on his own property.
- Rejection of Pure Resulting-Trust Analysis: The Court reaffirmed that, in domestic joint-name cases, proportional financial contributions do not automatically dictate beneficial shares.
Holding and Implications
HELD: The appeal is allowed; the trial judge’s declaration that the Appellant holds 90 % and the Respondent 10 % of the beneficial interest in the property at [Number] Main Street is restored.
Implications: The Supreme Court clarifies that (1) the presumption of equal beneficial ownership in joint-name cases can be displaced by post-acquisition conduct; (2) courts may, where necessary, impute a common intention to achieve equity; and (3) strict resulting-trust analysis based solely on financial contributions is inappropriate for family-home disputes. The decision reinforces the flexible, fact-sensitive approach introduced in Stack v Dowden and provides authoritative guidance for lower courts confronting similar co-ownership conflicts.
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