The thorny issue of a
couple’s beneficial interests in a jointly owned property following
relationship breakdown has once again been examined by the court, this time
relating to a Privy Council decision on appeal from the Bahamian Court of
Appeal. The case concerned the
relationship between Mr Marr and Mr Collie, who together had jointly purchased
several properties over the years in the Bahamas during their 17 year relationship.The last major
decision on this point came out of the 2007 English case of Stack v Dowden. It confirmed the principle that, in domestic
situations, ‘the starting point where there is joint legal ownership is joint
beneficial ownership...unless and until the contrary is proved’. To reach a different outcome, there needed to
be evidence that the parties shared a common intention that the beneficial
ownership should be held unequally. The
intention need not be expressly stated by either of the parties – inferences
from conduct and conversations throughout the relationship would be relevant. This mode of analysis was to be preferred to the
legal principle of a presumption of a resulting trust, where joint owners of
property hold the entire beneficial interest on trust for whichever of them pays
the purchase price, if only one of them had paid for it.
Stack concerned the beneficial ownership of a home. However, in the Marr case, the relationship was both personal and commercial. Mr Marr had funded the purchase of a home
for him and Mr Collie but there were other residential properties, purchased as
investments. Although the facts were
disputed between the parties, Mr Marr, a banker, used his own funds to pay the
deposit and serviced any debt associated with their purchase, while Mr Collie provided
his building skills. No declaration of
trust existed setting out how the equity was owned by the two parties. Did the reasoning in Stack apply only to ‘the purely domestic setting’? The court in Marr said no.
The Marr case is authority for extending the
Stack approach to jointly acquired
investment property, where there is an element of commercial endeavour as well
as a personal relationship. The
intention of the parties is still critical where a property is bought in the
joint names of a cohabiting couple, even if the purchase is for pure investment.
Putting a property into joint names is
evidence of intention but not conclusive evidence. Purely commercial transactions, where there
is no intention to derive any mutual benefit, continue to fall outside the Stack common intention analysis. The case also extends the Stack analysis to a wide range of
jointly owned assets, in this case including a car, boat and artwork.
