Thorpe and Chadwick LJJ and Wall J
Transfer of beneficial interest in property — Document signed by one party only — Whether document a contract to dispose of equitable interests under section 2 of Law of Property (Miscellaneous Provisions) Act 1989 or a disposition in writing for purposes of section 53(1)(c) of Law of Property Act 1925 — Matter remitted back to master for reconsideration
In 1988, the appellant, Mrs Chandler, purchased a family home in her sole name with money that belonged jointly to herself and her husband. In 1997, she and her husband agreed to divorce. A document was drafted, and signed by Mr Chandler, which purported to transfer all his beneficial interest in the property to Mrs Chandler in exchange for a sum of money, although the precise terms were not agreed at that stage. Mr Chandler subsequently made a will appointing the respondent, Mrs Clark, as his sole beneficiary, trustee and executor. The divorce was finalised in 1998. Shortly thereafter, Mr Chandler died and the will was granted probate.
In 2001, proceedings were commenced to determine the ownership of the property. A master held that the document signed by Mr Chandler was a contract to dispose of his equitable interest, but it was unenforceable because it had not been signed by both parties, as required by section 2 of the Law of Property (Miscellaneous Provisions) Act 1989. Furthermore, the wording of the document indicated that some future financial arrangement was still to be agreed. It was ruled that Mr and Mrs Chandler had held the beneficial interest in the property in equal shares. As Mr Chandler’s sole beneficiary, Mrs Clark was therefore entitled to his share in the property and an order for sale was made accordingly. Mrs Chandler appealed this decision on the ground that the document was not a contract for the disposal of the equitable interest, but was a disposition in writing in accordance with section 53 (1)(c) of the Law of Property Act 1925.
Transfer of beneficial interest in property — Document signed by one party only — Whether document a contract to dispose of equitable interests under section 2 of Law of Property (Miscellaneous Provisions) Act 1989 or a disposition in writing for purposes of section 53(1)(c) of Law of Property Act 1925 — Matter remitted back to master for reconsiderationIn 1988, the appellant, Mrs Chandler, purchased a family home in her sole name with money that belonged jointly to herself and her husband. In 1997, she and her husband agreed to divorce. A document was drafted, and signed by Mr Chandler, which purported to transfer all his beneficial interest in the property to Mrs Chandler in exchange for a sum of money, although the precise terms were not agreed at that stage. Mr Chandler subsequently made a will appointing the respondent, Mrs Clark, as his sole beneficiary, trustee and executor. The divorce was finalised in 1998. Shortly thereafter, Mr Chandler died and the will was granted probate.
In 2001, proceedings were commenced to determine the ownership of the property. A master held that the document signed by Mr Chandler was a contract to dispose of his equitable interest, but it was unenforceable because it had not been signed by both parties, as required by section 2 of the Law of Property (Miscellaneous Provisions) Act 1989. Furthermore, the wording of the document indicated that some future financial arrangement was still to be agreed. It was ruled that Mr and Mrs Chandler had held the beneficial interest in the property in equal shares. As Mr Chandler’s sole beneficiary, Mrs Clark was therefore entitled to his share in the property and an order for sale was made accordingly. Mrs Chandler appealed this decision on the ground that the document was not a contract for the disposal of the equitable interest, but was a disposition in writing in accordance with section 53 (1)(c) of the Law of Property Act 1925.
Held: The order was set aside.
The document was not an immediate and unconditional disposition in writing. It was clearly drafted for the purpose of facilitating a swift and uncontested divorce, and, in the circumstances, it could not have been Mr Chandler’s intention to convey his beneficial interest unconditionally to Mrs Chandler. It was unsuccessful as a conditional disposition because the conditions it contained were not, and could not, be fulfilled. Evidence adduced at the hearing indicated a joint tenancy and, since that had not been successfully severed, Mrs Chandler should therefore be granted full ownership by right of survivorship. It appeared that the master had been under the misapprehension that it was common ground that Mr and Mrs Chandler had been tenants in common, but this was not the case. The order was therefore made on erroneous grounds and would be set aside, and the matter remitted for reconsideration.
Stuart Nicol (instructed by Margaret Reynolds & Co, of Grays) appeared for the appellant; Janice Johnson (instructed by TA Capron & Co, of Grays) appeared for the respondent.
Vivienne Lane, barrister
