Equal sharing principle applies to all jointly owned assets, says UK court
The decision in Marr v Collie concerned a dispute in the Bahamas over the existence of a resulting trust. However, the court's decision is likely be followed in England and other jurisdictions.
It is closely related to the House of Lords case Stack v Dowden (2007), which established that where a domestic property was conveyed into the joint names of cohabitants, without any declaration of trust, prima facie both the legal and beneficial interests in the property were joint and equal. That position could only be displaced if the parties' whole course of conduct in relation to the property showed a common intention that their beneficial interests were to be different from their legal interests. The same principle arose in the important Supreme Court case of Jones v Kernott (2010 UKSC 53) concerning the beneficial interests in a family home acquired in joint names by an unmarried couple.
In Marr v Collie, the Privy Council has gone beyond that judgment in applying the principle to assets other than a couple's home. The dispute between Terry Marr and Bryant Collie concerned other types of assets, including works of art, a boat and a motor vehicle, as well as land – investments acquired for joint benefit.
The appellant, Marr, had provided most of the money for the purchase of these assets, and thus he claimed that the presumption of a resulting trust in his favour should be upheld without him having to prove it.
At first instance, Isaacs J concluded that the burden was indeed on Collie to rebut the presumption of a resulting trust in favour of Marr, and that he had failed to discharge it. This was later partially overturned in the Bahamas Court of Appeal, which found that there was sufficient evidence to conclude that it was the common intention of the parties that the beneficial interest should be shared.
However, the Privy Council disagreed with this, calling it 'unsustainable'. It accepted Marr's evidence that he had not intended to confer an equal beneficial interest in the investment properties on Collie, and that the decision to have the properties conveyed into joint names was on the basis that Collie would make an equal contribution to their development – a contribution that never fully materialised.
The Privy Council thus allowed Marr's appeal. However, it emphasised that it did not regard the Stack v Dowden judgment to be limited to the 'purely domestic setting', and that it applied also to investment assets. It thus remitted the case back to the Supreme Court of the Bahamas for a determination of ownership of the investment properties (Marr v Collie, 2017 UKPC 17).
So, despite the success of Marr's appeal, the fact that the Privy Council accepted that the Stack v Dowden 50-50 starting point rule applies to joint investment assets is a significant one, said Collie's counsel Mark Hubbard. 'The judgment reduces the role of the presumption of resulting trust in relation to a couple's assets, and perhaps in other family situations', he said. 'The implications are quite broad in both matrimonial and non-matrimonial situations and, for example, insolvency.'
- Privy Council (PDF file)
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