AC 886
House of Lords
Mrs Gissing had been married to Mr Gissing for 16 years, and had paid a substantial sum towards furniture and the laying of a lawn, but the house had been conveyed into the name of Mr Gissing alone, and Mrs Gissing had made no direct contributions towards its purchase. On their divorce, she claimed a beneficial interest.
The House of Lords held that she had no interest.
1. Lord Diplock drew a distinction between express agreement and inferred intention, which is essentially the same as that drawn by Lord Bridge in Lloyds Bank v Rosset between the first and second categories.
2. The interests of the parties were determined on the basis of their inferred intentions at the time of acquisition of the property, and not by their subsequent conduct. In the absence of express agreement, only conduct relevant to the acquisition of the property will generally be relevant. However, subsequent conduct may be evidence of intention at the time of acquisition.
3. As in Pettitt v Pettitt the fact that the parties were married made no difference.
4. The MCA 1973, ss. 24-25 were a reaction to the decision in Gissing v Gissing. These provisions only applied to breakdown of marriage, however, general equitable principles continuing to apply otherwise, as in e.g., Burns v Burns.
Extract from Lord Diplock's speech in Gissing v Gissing:
Any claim to a beneficial interest in land by a person, whether spouse or stranger, in whom the legal estate in the land is not vested must be based on the proposition that the person in whom the legal estate is vested holds it as trustee on trust to give effect to the beneficial interest of the claimant as cestui que trust. The legal principles applicable to the claim are those of the English law of trusts and in particular, in the kind of dispute between spouses that comes before the courts, the law relating to the creation and operation of `resulting, implied or constructive trusts'. Where the trust is expressly declared in the instrument by which the legal estate is transferred to the trustee or by a written declaration of trust by the trustee, the court must give effect to it. But to constitute a valid declaration of trust by way of gift of a beneficial interest in land to a cestui que trust the declaration is required by s. 53(1) of the Law of Property Act 1925, to be in writing. If it is not in writing it can only take effect as a resulting, implied or constructive trust to which that section has no application.
A resulting, implied or constructive trust - and it is unnecessary for present purposes to distinguish between these three classes of trust - is created by a transaction between the trustee and the cestui que trust in connection with the acquisition by the trustee of a legal estate in land, whenever the trustee has so conducted himself that it would be inequitable to allow him to deny to the cestui que trust a beneficial interest in the land acquired. And he will be held so to have conducted himself if by his words or conduct he has induced the cestui que trust to act to his own detriment in the reasonable belief that by so acting he was acquiring a beneficial interest in the land.
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