National Crime Agency v Dong [2017] EWHC 3116

Key point
  • The presumption of resulting trust is not abolished by s60(3) LPA 1925
Facts
  • NCA sued to claim unpaid taxes from Dong
  • Dong had transferred his home to his friend Feng’s name but continued living in the home with his family
  • NCA argued that the home was held for Dong on a presumed resulting trust and sought a charging order on the home
  • It was argued by counsel for Dong that the presumed resulting trust had been abolished by s60(3) Law of Property Act 1925
Held (High Court)
  • Dong retained beneficial interest in the home under a presumed resulting trust
Chief Master Marsh

Effect of s60(3) LPA 1925: [34]

  • The presumption of resulting trust is not abolished by s60(3) LPA 1925
  • Instead, s60(3) was aimed removing the technicality that a specific formula of words had to be included in a conveyance (stating the property conveyed for the “use or benefit” of the grantee) for the conveyance to be effective

Justification: [35]

  • If it was the intention of the draftsman to abolish the long-standing presumed resulting trust, the Act would have done so in clear terms
  • There is no good reason to abolish the presumption in relation to land but not chattels as the interest in land being conveyed without consideration might be worth very much less than the value of some types of chattel
Commentary
  • s60(3) LPA 1925 states that “[i]n a voluntary conveyance a resulting trust for the grantor shall not be implied merely by reason that the property is not expressed to be conveyed for the use or benefit of the grantee”
  • Prior to this case, the deputy judge in Lohia v Lohia held in first instance that on a literal interpretation s60(3) Law of Property Act 1925 the presumed resulting trust was abolished, Lord Browne-Wilkinson thought that this interpretation was “arguable” in Tinsley v Milligan
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