Legal Principles and Key Points
- In the case of Goodman v Gallant 1986 fam 106, it was found that where a a conveyance into joint names contained an express declaration of trust that the parties were to hold the proceeds of sale of the property on trust for themselves as joint tenants, then on severance of the tenancy, a tenancy in common in equal shares was created.
Facts of the Case
- In 1960, P and her husband bought a house which was conveyed in the sole name of the husband, although it was agreed between the couple that P was entitled to half a share in the beneficial interest in the property.
- By 1971, P had left the husband and later began living in the property with D.
- In 1978, the husband, in consideration of his share, conveyed the freehold to P and D as beneficial joint tenants of the trust for sale to hold the net proceeds upon trust for themselves as joint tenants.
- In 1978, P severed the joint tenancy and issued a summons for the determination of their respective beneficial interests.
- P contended that she was entitled to three quarters of the beneficial interest on the basis that she already owned one half and it was intended that the joint tenancy should only extend to the half share she received from the husband.
- At first instance, the registrar held that they held the title as tenants in common in equal shares with the judge on appeal by the claimant upholding this decision.
- P then appealed this to the Court of Appeal.
Issues in Goodman v Gallant 1986 fam 106
- Was P entitled to a more than equal share of the sale price?
- Did a resulting implied or constructive trust apply?
Held by Court of Appeal
- Appeal dismissed.
- Held that a tenancy in common was created when the trust for sale by joint tenancy was severed.
- “It would no doubt be possible for a trust in terms to provide that the beneficial interests of two parties should be equivalent to those of joint tenants unless and until severance occurred, but that in the event of severance their interests should be otherwise than in equal shares. In our judgment, however, such an arrangement cannot be spelt out of the relevant wording of the conveyance in the present case, which must be construed according to the traditional sense of a beneficial joint tenancy, with all its incidents, including those relating to the effect of severance” pg. 119.