Richard Power’s case Jones v Kernott  EWCA Civ 578 is going to the Supreme Court. The CA gave leave to appeal on 26th May 2010.
This is a seminal case and will give the Supreme Court an opportunity to reconsider the question of ‘ambulatory’ trusts, (Stack v Dowden  UKHL 17).Ms Jones and Mr Kernott, an unmarried couple, acquired a residential property in joint names and lived together. Ms Jones had paid all of the deposit, but she accepted that Mr Kernott had made a “fair” contribution to other household expenses including the mortgage payments. The judge at first instance found that Mr Kernott was responsible for an extension which increased the value of the property by approximately 50%.
Between 1993 and the hearing in 2008 Ms Jones had continued to live in the property with their children, paying the mortgage and all the other outgoings. The parties co-operated in order to acquire a property for Mr Kernott by cashing in a life insurance policy. He could not have afforded his new property if he had continued to contribute to the mortgage payments or household bills of his former home.
During the relevant 14 year period there was a huge increase in the value of both the joint property and Mr Kernott’s own property. In the absence of the ambulatory principle, Mr Kernott receives the combined windfalls of all of the increased value of his own property and half the increased value of the joint property.
The trial judge, HHJ Dedman, bravely refused to grant this, as did Mr Nicholas Strauss QC on appeal. It was left to the majority of the Court of Appeal to stick with authorities decided in another age in holding that their interests were equal.
Once again Lamb Chambers leads the way in much needed reform of the law of equity.
Philippa Seal / 1st Oct 2010
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