Paul v Constance [1977] 1 WLR 527

Facts

Mr. Constance’s marriage broke down (but he never divorced) and he moved in with Ms. Paul. Following a workplace accident, he received £950 in damages and after discussions with a bank manager, he paid it into a new joint account with Ms. Paul. They were unmarried, so the account was put in Mr. Constance’s name alone.

He told Ms. Paul that “this money is as much yours as it is mine”.

The couple played bingo as a joint venture and with the winnings, they made three further deposits into the account.

There was one withdrawal from the account amount to £150 and this was used to buy Christmas presents and food.

Mr. Constance died interstate in 1974 and his wife as admistratrix of the estate closed the account and claimed the money in the account formed part of his estate.

The claimant argued that the sums contained in the account were held on trust for the benefit of her and Mr. Constance jointly.

Held:

There was an express declaration of trust and the claimant was entitled to the money in the account.

Lord Justice Scarman:

“When one bears in mind that unsophisticated character of the deceased and his relationship with the plaintiff during the last few years of his life, the words that he did use on more than one occasion ‘this money is as much yours as it is mine’, clearly convey a present declaration that the existing fund was as much the plaintiff’s as his own”.

we are dealing with … people, unaware of the subtleties of equity, but understanding very well indeed their own domestic situation. It is right that one should consider the various things that were said and done by the plaintiff and Mr Constance during their time together against their own background and in their own circumstances.”

Categories: Trusts: Case Summaries

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