Solomon v Solomon

• Jurisdiction: Cayman Islands
• Judge: (Collett, C.J.)
• Judgment Date: 11 August 1988
• Court: Grand Court (Cayman Islands)
• Date: 11 August 1988

Grand Court

(Collett, C.J.)

S. SOLOMON

and

T. SOLOMON, CARTER and TATUM

C.H. Rose for the applicant;

Ms. C. Bridges for the respondent.

Cases cited:

(1) Burns v. Burns, [1984] Ch. 317; [1984] 1 All E.R. 244.

(2) Crabb v. Arun District Council, [1976] Ch. 179; [1975] 3 All E.R. 865, dictum of Lord Denning, M.R. applied.

(3) Grant v. Edwards, [1986] Ch. 638; [1986] 2 All E.R. 426, dictum of Mustill, L.J. applied.

(4) Hughes v. Metropolitan Ry. Co.ELR(1877), 2 App. Cas. 439; [1874–80] All E.R. Rep. 187.

(5) Inwards v. Baker, [1956] 2 Q.B. 29; [1965] 1 All E.R. 446.

(6) Ofori Atta II v. Abu Bonsra IIELR, [1958] A.C. 95; sub nom. Abuakwa v. Adanse, [1957] 3 All E.R. 559, distinguished.

(7) Turton v. Turton, [1988] Ch. 542; [1987] 2 All E.R. 641.

(8) Willmott v. BarberELR(1880), 15 Ch. D. 96, dicta of Fry J. applied.

Estoppel-res judicata-different parties in earlier litigation-donee of interest in land who fails to join earlier unsuccessful litigation challenging donor”s title not estopped from joining subsequent litigation affecting title-estoppel raised if earlier litigation established donor”s defective title

Trusts-constructive trusts-expenditure on land-no inference of constructive trust of beneficial ownership of mother”s home if rebuilt by son at own expense but without common intention to share ownership-no proprietary estoppel in absence of encouragement by owner unaware of expectation-compatible with intention to give rent-free occupational rights

The applicant applied for a declaration that he was entitled to an equitable interest in land and property owned and occupied by his mother and rectification of the Land Register accordingly.

In 1966 the applicant”s mother, whilst continuing to occupy the family home, conveyed the whole premises to her three daughters, the respondents, by way of gift in equal shares as tenants in common. At the same time by a separate deed of gift, she conveyed a nearby lot of land to the applicant, her son, who was then living abroad.

Two years later an unsuccessful action was brought against the

mother in respect of the family home. The respondents were not joined as parties in these proceedings nor did they seek to intervene to assert their own title under the deed of gift. All the necessary expenses of the case and the subsequent appeal were met by the applicant.

In 1973, the applicant returned permanently to the Cayman Islands and took up residence with his mother in the family home. During the first year he lived there, he undertook, with his mother”s approval, substantial renovation work on the building involving in large part his own labour. He met all the other expenses of the work from his savings and upon its completion continued to live there for the next 14 years whilst contributing to the support of his mother.

When land registration was introduced in 1974, the applicant took the necessary steps to procure his own registration as first proprietor of the land which had been conveyed to him by his mother in 1966 but he made no attempt to establish and record a proprietary interest in the family property; nor did any of the respondents take any steps to secure their own registration as proprietors but instead allowed their mother to register as the sole proprietor. This had the effect under the Registered Land Law, s.23 of revesting the sole title in that lot to the mother.

In 1980, the mother transferred the title to the family home to the respondents but neither she nor the respondents signed the instrument of transfer and, in lieu of signature, appended a copy of the 1966 deed of gift. This was accepted by the Land Registrar as a proper observance of the formalities and the respondents became the registered proprietors.

In 1987 the applicant brought the present proceedings against the respondents, seeking a declaration that he was entitled to an equitable interest in the property; and rectification of the Land Register to add his name to those of the respondents as the legal owners.

He submitted that (a) the deed of gift in favour of the respondents had lapsed prior to 1973 by reason of their failure to join in the previous proceedings against the mother in 1968 and as a result they had lost their proprietary interest and moreover had no locus standi in the present proceedings; (b) a constructive trust had been created in his favour by his expenditure of a large part of his savings and the input of his time and labour in rebuilding the house, none of which he would have done had his mother not clearly demonstrated her intention to give him a proprietary interest in the property; and (c) alternatively, the doctrine of proprietary estoppel applied and it would accordingly be inequitable for the respondents to insist on their strict legal rights as they were aware of his ignorance of the conveyance to them in 1966 and had stood by and allowed him to spend a considerable sum of money on it knowing that he was under the mistaken belief that it still belonged to his mother and was hers to dispose of as she wished.

Held, refusing the application:

(1) The respondents” decision not to join in the earlier action challenging the mother”s title to the land would have estopped them from relitigating that issue only if it had been held in those proceedings that the mother did not in fact have a good possessory title to the land. Further, they were not estopped from raising the new and separate issue of the

validity of the deed of gift to themselves, either against the mother herself or against any other person claiming to derive title from her, since this was not an issue that had ever been raised or decided upon in the earlier suit. As they had done nothing to cause the deed of gift to lapse, it remained in full force up to the time of the first registration of the land in their mother”s name in 1974. Up to that time the respondents would have had full legal title to the property and thereafter a beneficial interest upon the reversion of the title to the mother as sole proprietor. These were both circumstances which gave them the right to defend those interests in a court of law (page 149, lines 2–6; page 149, line 37 – page 150, line 13).

(2) There was no basis for holding that a constructive trust had been created in the applicant”s favour. He had not established that there had been a common intention shared by himself and his mother that they should both have a beneficial interest in the property or that he had rebuilt the family home in the belief that he would thereby acquire such an interest. Moreover, the fact that he had made no attempt to register the proprietary interest claimed at the time he had registered a similar interest in the other land given to him by his mother belied the claim that he ever did believe he had acquired such an interest. The mere fact of rebuilding the house at his own expense was sufficient only to establish a common intention that he should reside there rent-free. In any event, even if there had been a common intention to vest a proprietary interest in him, the mother had already transferred the whole legal and beneficial interest to the respondents prior to her own registration as sole proprietor in 1974 and any purported gift of an interest in the same land to him before that date would have been void. After 1974, the beneficial interest in the property remained in the respondents by virtue of the 1966 deed of gift and the mother would thereafter have been holding the property on an implied trust in their favour, upon which a further constructive trust in the applicant”s favour could not be imposed (page 152, line 3 – page 153, line 1).

(3) The applicant could not rely on the doctrine of proprietary estoppel in support of his claim, for although he may have made a mistake about his own legal rights and expended a considerable sum on that basis, there was no evidence to show that the respondents (a) had known of the applicant”s mistaken belief or (b) had encouraged him in any way in that belief or to spend his money or work on the property. The requisite elements for establishing a proprietary estoppel had therefore not been made out and there was no basis for finding that it would be unconscionable or contrary to fundamental equitable principles for the...