{"id":14296,"date":"2023-07-10T01:02:32","date_gmt":"2023-07-10T01:02:32","guid":{"rendered":"https:\/\/careerinlaw.net\/uk\/?p=14296"},"modified":"2023-11-23T09:45:54","modified_gmt":"2023-11-23T14:45:54","slug":"case-summary-lyus-v-prowsa-development-ltd-1982-1-wlr-2004","status":"publish","type":"post","link":"https:\/\/careerinlaw.net\/uk\/case-summary-lyus-v-prowsa-development-ltd-1982-1-wlr-2004","title":{"rendered":"Case Summary: Lyus v Prowsa Development Ltd 1982 1 WLR 2004"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\" id=\"h-legal-principles-and-key-points\"><strong>Legal Principles and Key Points<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>In the case of Lyus v Prowsa Development Ltd 1982 1 WLR 2004, it is established that a mere notice of a contractual licence is not enough to impose a constructive trust.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Facts of the Case<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A building company contracted with the claimant, Lyus (C), for the purchase of a plot of land which was part of an estate under the development of the defendant, Prowsa Development Ltd (D).<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Lyus paid a deposit for the plot but before the completion of the building, the developers became insolvent.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The bank holding the charge over the property sold the land on but noted the unique nature of the claimants, Lyus\u2019s, plot within the agreement.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The land was sold once more 3 months later, on the same basis but this time the claimant was not recognised in the agreement.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Issues in Lyus v Prowsa Development Ltd 1982 1 WLR 2004<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Could the claimant rely on their contract under the Law of Property 1925?<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Held by The High Court<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Both buyers after the after the insolvency were to be subject to the contract under constructive trusts<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The claimant was entitled to have specific performance against the final buyer.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Justice Dillon<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A \u2018subject to\u2019 clause is not enough to impose a constructive trust<\/p><div id=\"caree-177409525\" class=\"caree-within-the-content caree-entity-placement\" style=\"margin-left: auto;margin-right: auto;text-align: center;\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/careerinlaw.net\/uk\/wp-content\/uploads\/sites\/3\/2023\/10\/MRF-169650-in-article-336x280-1.png\" alt=\"\"  srcset=\"https:\/\/careerinlaw.net\/uk\/wp-content\/uploads\/sites\/3\/2023\/10\/MRF-169650-in-article-336x280-1.png 448w, https:\/\/careerinlaw.net\/uk\/wp-content\/uploads\/sites\/3\/2023\/10\/MRF-169650-in-article-336x280-1-300x250.png 300w\" sizes=\"(max-width: 448px) 100vw, 448px\" width=\"448\" height=\"373\"  style=\"display: inline-block;\" \/><\/div>\n\n\n\n<ul class=\"wp-block-list\">\n<li>There are many cases in which land is conveyed subject to incumbrances without the intention of conferring fresh rights on third parties, the land may be&nbsp;expressed to be sold subject to incumbrances to satisfy the vendor\u2019s duty to disclose all possible incumbrances and to protect the vendor against any potential claim by the purchaser.<\/li>\n\n\n\n<li>The words \u201csubject to\u201d will, of course, impose notice, but notice is not enough to impose an obligation to give effect to a contract into which he did not enter.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">How a constructive trust arises in the current case.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The bank could not have been under any obligation to C, thus the \u2018subject to\u2019 clause was part of the bargain between the bank and the first buyer after the insolvency.<\/li>\n\n\n\n<li>The defendants could not rely on the Land Registration Act 1925 to overreach the constructive trust, or it would alter its use to an instrument of fraud.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Legal Principles and Key Points Facts of the Case Issues in Lyus v Prowsa Development Ltd 1982 1 WLR 2004 Held by The High Court Justice Dillon A \u2018subject to\u2019 clause is not enough to impose a constructive trust How a constructive trust arises in the current case.<\/p>\n","protected":false},"author":7,"featured_media":13103,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[23],"tags":[],"class_list":["post-14296","post","type-post","status-publish","format-standard","has-post-thumbnail","category-case-summaries","entry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.4 (Yoast SEO v28.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Case Summary: Lyus v Prowsa Development Ltd 1982 1 WLR 2004 | Careerinlaw.net | UK<\/title>\n<meta name=\"description\" content=\"In the case of Lyus v Prowsa Development Ltd 1982 1 WLR 2004, it is 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