The law of implied trusts continues to provoke controversy and confusion. This collection of essays from an impressive range of experts is an important recent contribution to the debate, albeit one that contains a significant amount of historical material. The volume is conveniently divided into two parts, thus reflecting its title, although the subject-matter of Ben McFarlane's chapter in particular straddles both resulting and constructive trusts.
Paul Matthews opens the book with a “partial history” of the constructive trust. He begins by focusing on the differences between express and constructive trusts as regards formality requirements and limitation of actions. Most of the chapter is taken up by a comprehensive discussion of the relationship between the common intention constructive trust and the doctrine of proprietary estoppel, an account rendered all the more useful by the number of high-profile recent cases in which the matter was considered.
With reference to a number of contexts, Simon Gardner then seeks to characterise the constructive trust as one that corrects the loss suffered when a person forgoes alternative opportunities to achieve a desired result in reliance on another's representation. He stops short of a firm conclusion that the law intervenes in such circumstances as a general rule outside as well as inside property law, but contemplates that possibility.
William Swadling then considers the nature of the trust imposed in the seminal case of Rochefoucauld v. Boustead. In his chapter, Gardner regards it as “quite clear” that the trust was constructive (68). Swadling, by contrast, thinks that the “only tenable view” is that it was an express trust (95). In the process, he systematically deconstructs the arguments in favour of regarding Rochefoucauld as an example of the constructive trust in a highly convincing manner.
In their chapter on knowing receipt, Charles Mitchell and Stephen Watterson also counter a prevailing view, albeit advocating a return to earlier understanding. They attempt to reassert the propriety of the language of “constructive trusteeship” to describe the liability of third-party recipients of trust property. They then provide an exhaustive account of the duties of such recipients and a comparison with other forms of liability, including a critical analysis of unjust enrichment-based approaches to recipient liability.
Matthew Conaglen and Amy Goymour continue the knowing receipt theme. They argue that a claim in knowing receipt should not be possible against a purchaser of registered land, regardless of his level of knowledge surrounding the original breach of trust. In order to defend this position, which opposes that of the Law Commission, they invoke section 29 of the Land Registration Act 2002. That section, inter alia, allows a purchaser who registers his title to take it free of beneficial interests under a trust unless the beneficiaries are in actual occupation. Conaglen and Goymour claim that the lack of proprietary liability where section 29 applies also negates parasitic personal liability for knowing receipt because the potential defendant does not receive “trust property”, and because such liability would undermine the purposes of land registration by re-attaching significance to concepts such as notice.
In his more general contribution to the volume, Ben McFarlane powerfully refutes the commonly held view that resulting and constructive trusts are mere anomalies. In the process, he also expresses doubts about the proprietary conception of the trust. Rather, he conceptualises a trust as existing where A owes a duty to B relating to a right held by A, provided that duty encompasses an obligation not to use the right for A's own benefit. McFarlane uses this analysis to argue that express trusts, as distinct from resulting and constructive trusts, are simply important instances of a wider principle. In turn, in his view, there is no reason to prioritise them and implied trusts do not require any particular justification. In fact, McFarlane claims that express trusts are dependent on implied trusts.
John Mee opens the second part of the collection with a chapter on the justification for “automatic” resulting trusts. He points out that the notion of the settlor retaining the beneficial interest when such a trust arises has a longer pedigree than is often assumed. Nevertheless, Mee questions the cogency of the “retention” explanation, as well as the alternative restitution-based arguments. The key factor, he argues, is the settlor's intention to make the recipient of the trust property a trustee, such that only the settlor may justifiably take any unallocated portion of the beneficial interest.
Drawing on the work of William Swadling, Robert Chambers and Lord Millett, James Penner examines “three controversies” generated by their writings on the unjust enrichment-based analysis of resulting trusts. The first relates to whether the presumption of resulting trust is raised only where there is no consideration for the relevant contribution to the defendant's property or the transfer of title to him. Penner prefers the view that the presumption's operation is not limited to such circumstances, largely on the basis of authority rather than principle. The second issue is whether the presumption is one of evidence or of law. After a thorough analysis of the relevant cases, Penner concludes that the presumption is one of law, mostly preferring the work of Chambers to that of Swadling. The final controversy addressed by Penner is whether the resulting trust responds to unjust enrichment. On this point, he mounts a robust defence of the “retention” analysis adopted by Lord Millett, and argues that even accounts based on unjust enrichment depend to an extent on the acceptance of that analysis.
The very existence of the presumption of resulting trust is questioned by Chambers himself in the next chapter. He contends that the true presumption is that of advancement, and that a resulting trust occurs where the presumption of advancement does not apply. Chambers does not seek to doubt the existence of the resulting trust itself: he simply points out that such a trust usually “responds to evidence of intention rather than a presumption of intention” (275). While he plays down the practical significance of this argument in its own right, he argues that the presumptions tell us much about the nature of the resulting trust and its relationship with unjust enrichment.
Discussion of the presumption of advancement has been somewhat overtaken by events as far as England and Wales is concerned, since section 199 of the Equality Act 2010 will (if commenced) abolish the presumption prospectively as regards both spouses and parents. Unfortunately, this casts a particular shadow over Jamie Glister's chapter, in which he argues that advancement should not necessarily be equated with maintenance and support. Rather, he claims, advancement relates to establishment in life and facilitating a contribution to society.
Charlie Webb returns to the resulting trust's relationship with unjust enrichment in his chapter. He rejects a suggestion by Swadling that the unjust enrichment explanation of the resulting trust is conceptually incoherent. At the same time, Webb pleads for a better understanding of the normative justification for claims relating to mistaken and otherwise defective transfers.
Finally, Irit Samet offers a highly distinctive perspective on the invocation of the resulting trust and other mechanisms by parties to schemes tainted by illegality. She does so from the standpoint of a moral philosopher. In her chapter, Samet inter alia discusses the significance of whether the scheme was brought to an end because of genuine repentance or self-interest by one of the parties, and whether a distinction should be made between cases where the harm was achieved and those where it was not.
Many of the chapters in this volume will incite further debate, and none of them can be accused of simply rehearsing old arguments. The book is an invaluable resource for scholars, graduate students and able undergraduates.
