IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
B E T W E E N :
D.S. LOHIA AND MRS. H.K. LOHIA
Plaintiffs
- and -
UGARA SINGH LOHIA
Defendant
______________
Judgment
______________
Mr. William Geldart, instructed by Messrs. Harman Garfinkel, appeared for the plaintiffs; Mr. R.K. Sahonte, instructed by Messrs. Raymond Sewell & Co, appeared for the defendant.
This case concerns a house at 41, Aberdeen Road, London, N.5. It was bought for £1,650 in December 1955. By October 1999 it was worth £525,000. Its registered owner after 1995 was Mr. M.S. Lohia, who died intestate on 20th February 1971. The original plaintiff was Mr. J .S. Lohia, the younger son of Mr. M.S. Lohia, who died in 1992. The defendant is Mr. U.S. Lohia, the older son of Mr. M.S. Lohia. There were two younger brothers who died in a car crash in 1969, with four other members of the family. Mr. M.S. Lohia had a daughter, Mrs. Piro Wanti, who died in the autumn of 1998.
The action was commenced by an originating summons issued on 19th February 1987, supported by Mr. J.S. Lohia’s affidavit. He claimed a declaration that the property was held on trust for sale for himself and Mr. U.S. Lohia as tenants in common, an order for sale and an enquiry as to what sum was due from Mr. U.S. Lohia to himself as occupation rent, on the footing that he had been excluded from the property.
In his affirmation dated 22nd December 1987, Mr. U.S. Lohia claimed that the property had been bought in 1955 by his father and himself as tenants in common in equal shares, and that a transfer of his interest to his father in 1965 was a forgery; therefore only his father’s half share formed part of the estate. He denied that he had excluded his brother from occupation of the premises and therefore denied any liability for an occupation rent. It is common ground that he is not liable for an occupation rent unless he did exclude his brother from the premises: see Dennis v MacDonald [1981] 1 W.L.R. 810. An order made by Master Munroe on 2nd December 1987 provided that Mr. J.S. Lohia should be at liberty to serve an affirmation in reply, but he did not do so.
Nothing happened in the action until 11th August 1992, when Master Gowers made an order substituting the administrators of Mr. J.S. Lohia (Mr. D.S. Lohia and his widow Mrs. H.K. Lohia) as plaintiffs. The action then went to sleep again until 25th November 1997, when the plaintiffs applied for directions for trial, which were eventually given by Master Moncaster on 26th January 1999.
Two further affidavits were sworn,
one by Mr. Harbert Lohia, the son of Mr. U.
S. Lohia, on 22nd February 1999, and one by Mrs. H.K. Lohia on 28th September
1999, which I permitted to be introduced in evidence notwithstanding its service
only shortly before the hearing began on 16th October 1999. All the deponents,
except of course for the late Mr. J.S. Lohia, were cross-examined at the hearing.
No explanation has been given for the delay, which in other circumstances might well have given rise to an application to strike out. Any such application would, however, have been pointless in this case, since it would have left the situation with regard to the property unresolved.
The main issues before me are whether Mr. U.S. Lohia was the beneficial owner of a one-half interest in the property at the time of his father’s death and whether he excluded his brother, Mr. J.S. Lohia, from the property in or about 1977, so as to make himself liable for an occupation rent. The resolution of these issues is not made easier by the passage of time or by the virtual absence of documentary evidence relating to the transfer in 1965.
The circumstances in which the property was bought are set out in Mr. U.S. Lohia’s affirmation, which he amplified in his oral evidence. They are not in dispute. In 1955 he was 26 years old and had been in England for 3 years. His father had come to England only in 1954. They had been living in Bristol, but had moved to London. His father found the house in Aberdeen Road and suggested that they buy it together, and this was agreed. It was agreed that they would each own a half share of the house. The bulk of the purchase price, £1,300 out of £1,650, was left outstanding by the vendor on the security of a mortgage of the house, of which no copy is now available. Mr. U.S. Lohia paid the greater part of the balance and of the expenses of the purchase, and the rest was paid by his father.
After the house had been acquired, Mr. U.S. Lohia and his father and brothers all moved in. Parts of the house were let. There is clear documentary evidence to show that the mortgage debt to the vendor was paid off at the rate of £12 per month, the final payment being made in April 1967. According to Mr. U.S. Lohia’s affirmation, the payments and the other outgoings were funded by the rent collected from the tenants; any shortfall was met by equal contributions. In his oral evidence he said that he earned more and that his contributions were greater. However, nothing turns on this.
On 14th April 1965, Mr. M.S. Lohia was registered as the sole owner of the property. On 4th August 1965, Messrs. Michael Temkin & Co, the solicitors who had acted for Mr. M.S. Lohia and Mr. U.S. Lohia on the purchase of the property, wrote to Mr. M.S. Lohia as follows:
"re 41 Aberdeen Road, N5
We now enclose herewith Office Copy of the Land Registry Entries, which show that you are now the sole proprietor of the above property ..."
It has been ascertained that a transfer was lodged by Robertson Martin & Co. - who had been the vendor’s solicitors - on 14th April 1965 and that a note on the Land Registry’s file states that the transfer was not for value. Despite enquiries, no other notes or correspondence have been found to explain the transfer, nor has a copy of the transfer itself been obtained.
Mr. U.S. Lohia denies that he ever agreed to transfer or did transfer his half interest in the house to his father. He accepts that his father had a half-interest in the house which passed to his estate, but maintains that he always kept his own half interest. In other words his case is that, in law, they were initially and remained tenants in common.
The solicitors who dealt with Mr. Lohia’s estate were Messrs. Earle and Waller. On 13th October 1972, letters of administration were granted to Mr. J.S. Lohia. On 28th March 1974 Earle and Waller wrote to him enclosing a form of assent transferring the house into the joint names of himself and his mother. However, on 17th April 1974 Mr. J.S. Lohia signed a form of assent in favour of himself and Mr. U.S. Lohia "as joint tenants in law on trust for themselves as tenants in common in equity." On 25th November 1974, Mr. J.S. Lohia and Mr. U.S. Lohia signed a form of authority instructing Earle and Waller to hand (inter alia) the deeds of the property to Mr. U.S. Lohia.
Both brothers and their families continued to live in the house for some years. Mr. J.S. Lohia and his family then left. There is no evidence from the witnesses as to precisely when this was, but a letter to North Thames Gas from his then solicitors, Messrs. Trott & Gentry, dated 20th September 1978 gives the date of his departure as November 1977, and there is no reason to doubt this.
Prior to this letter, on 18th May 1978, the Islington Legal Advice Centre had written to Mr. U.S. Lohia referring to 41 Aberdeen Road as "the ... house which he jointly owns with you, consequent upon the death of your later father," complaining that Mr. J.S. Lohia had been unable to gain entry to the house because he had been locked out of the house and about other matters, severing "any joint tenancy in equity which subsists, or may be alleged to have subsisted ..." and inviting proposals to buy him out. Trott & Gentry followed this up in the letter to which I have already referred, but without result.
On 6th April 1982 Messrs. Kennedys acting for Mr. J.S. Lohia wrote to Mr. U.S. Lohia stating that their client "owns the above property jointly with yourself" and inviting proposals to buy his share. On 20th April 1982, Messrs. Halliwells replied on behalf of Mr. U.S. Lohia asking how much "your client would require for his half share of the property." However, it is clear from the letter that Messrs. Halliwells had not at this stage yet taken instructions from Mr. U.S. Lohia, so no adverse inference can be drawn from the reference to the half share. On 27th April 1982, Messrs. Halliwells wrote as follows:
"... we have now taken our client’s instructions and it would appear that the above property was originally purchased by our client and his father with the intention of providing a family home. This being the case, attempts to sell on the open market would be most vigorously resisted.
We understand that the father of our respective clients died intestate and accordingly it would appear (although we have not yet seen the title deeds) that our client will have a claim for a three quarter share of the property."
On 30th April 1982 Halliwells wrote further:
"Although we have as yet seen no papers in connection with our client’s claim to a three quarter share of the above property, it would appear that this should be the correct figure as our client already owns half of the property before his father’s death intestate, and he would then presumably have shared the father’s half equally with your client."
Kennedy’s replied on 5th May 1982:
"We attach copies of the Office Copies we obtained two months ago which disclose the Father, Mr. Man Lohia Lohia, was the sole owner up until April 1974. We shall be glad to know on what basis your client claims to have owned one half of the property before his Father’s Death in 1971. Our instructions are that the Father was the sole owner up until his death."
Halliwells replied on 14th May 1982, but unfortunately the letter is missing. It appears from Kennedy’s reply that it referred to Mr. U.S. Lohia’s payments of mortgage instalments, but it may have said more than this.
After some further correspondence to which I need not refer, Halliwells wrote on 16th September 1983:
"We have once again taken our client’s instructions ...
As regards the above property, he is, on production of the Surveyor’s Report, prepared to purchase your client’s share but he cannot accept that your client is entitled to more than a quarter of the value of the property."
There the matter rested until 17th June 1986 when Mr. J.S. Lohia’s present solicitors, Messrs. Harman Garfinkel, wrote to Mr. U.S. Lohia saying that unless agreement was reached for the purchase of their client’s interest, proceedings would be commenced for an order for sale.
In his affidavit of 18th February 1987 in support of the application, Mr. J.S. Lohia did not give any explanation as to the 1965 transfer, and said merely:
"The property was bought in 1955 by our father, Mr. Man Lohia Lohia. I believe that he borrowed the purchase price, or at least part of it, from the Vendor Minnie Estowe; the charges register of the property shows that there was once a charge in her favour dated the 16th December 1955. The house was originally in the joint names of my father and the Defendant, though subsequently the property was transferred into my father’s sole name. The proprietorship register shows that the property was registered in my father’s sole name in 1965, ten years after he had first bought the property."
On the issue of his exclusion from the property he said:
"The house is large, five storeys high. My brother and I agreed after my father’s death that we would split the house into two and have two and a half storeys each. However, there were arguments between us over the splitting of the house. These arguments were never resolved and my brother locked me out of the house on repeated occasions. I had no alternative but to take my family and live elsewhere. I have had no contact with my brother since 1977 except through the Islington Legal Advice Centre and, subsequently, solicitors."
After proceedings had been commenced, Harman Garfinkel wrote to Halliwells on 13th April 1987:
"We originally wrote to your client regarding this matter in June of last year saying that we would be applying for an order for sale unless agreement was reached for the purchase of our client’s interest and asking to hear from him shortly. We received no response and it has, therefore, been necessary to issue these proceedings. As is apparent from the documentation you have received, the property is owned by the parties as tenants in common following their father’s death intestate. There can be no dispute as to facts. Your client must now either purchase our client’s share, or the property must be sold on the open market and the proceeds divided equally. These appear to us to be the only possible outcome of these proceedings as there is no dispute as to fact and our client is prepared for the matter to be resolved in either of these ways."
In their reply of 15th April 1987, they said:
"... we understand from our client that there had been an agreement between our respective clients that your client would only be entitled to one-third of the property rather than one-half."
But on 8th October 1987, they corrected this:
"We refer to our letter of 15th April and our subsequent letter of 29th April, which authorised you to treat our earlier letter as an ‘open’ letter.
Since writing those letters we have had the benefit of several very long meetings with our client. It appears that the understanding between our respective clients was not that your client would be entitled to one-third of the property, but rather that he would be entitled to one-quarter of the property. This basis upon which that one-quarter share should be calculated should reflect the very considerable amount of money which our client has spent on the property. Our client has in mind that these sums should be deducted from the gross value of the property, and then the net figure should be divided as to one-quarter to your client, and as to three-quarters to him."
Mr. U.S. Lohia said in his affirmation:
"6. The house was purchased by my father and me jointly and the legal title was put in our joint names. As far as I was aware that was how matters stayed until his death in 1971, and it was always my understanding that until his death I was beneficially entitled to one-half of the value of the house. I am advised by my solicitors that in about 1965 my father was registered as the sole proprietor of the house on the strength of a Transfer which it is supposed that I must have signed. I have absolutely no recollection of ever having seen or signed any such Transfer, nor do I know of any reason why it should have been desired to transfer the ownership of the house to my father alone. We did not fall out with each other, and no-one ever said anything to me about any change in the ownership of the house. I do not believe that I ever signed this Transfer, and must conclude that if my signature appeared on it, it was forged. I have no idea why such deception might have been deemed necessary as I was certainly paid no money supposedly as consideration for giving away my rights to my father, and right up to the time of his death considered myself (and as I always understood it, was also considered by him) to be a half-owner.
7. In support of this I point to the fact that I continued to contribute an equal share of the mortgage repayments until it was discharged in 1967, and to the fact that I continued at all times until his death to discharge my share of all the other outgoings. I also continued to receive half of the tenants’ rent up until the date of my father’s death.
8. Paragraph 1 of the Plaintiff’s Affidavit is therefore factually correct insofar as it deals with the legal estate of 41 Aberdeen Road, but I do not accept the inference which may be drawn that I ceased to be entitled to my half share of the property in 1965.
9. Paragraph 2 is also factually correct as far as it goes. My father died when the Plaintiff says he did, and my brother in due course became his personal representative. He was advised by solicitors, and my understanding from him was that he and I were entitled to share our father’s interest in 41 Aberdeen Road between us. I regard and have always regarded my father as having had no more than a one-half share in the property, and understood that the effect was that I became the owner of three-quarters and that my brother became the owner of one-quarter of the property. No-one ever explained to me the Assent executed in 1974 and I did not understand it to deal with any more than my father’s share of the property. I therefore did not query it, as I certainly would have done had I realised that it purported to show that my brother had half of the whole property - instead of merely half of my father’s half of it."
On the exclusion issue he said:
"... it is true that the house is large. For some months before my father’s death the Plaintiff was living with his family in Bristol. After my father died the Plaintiff took over occupation of the first and second floor rooms which my father had previously occupied. From then on my family occupied the basement and ground floor and the Plaintiff’s family occupied the first and second floors. The top floor, at the time of my father’s death, was occupied by a tenant who moved out shortly afterwards. Then a new tenant was allowed in by the Plaintiff who paid his rent to the Plaintiff. I never agreed to this arrangement. There were frequent arguments over this period between the Plaintiff and myself concerning this arrangement, among other things. The Plaintiff usually gave most of this rent to me as his contribution to the upkeep of the building. I considered that most of this rent rightfully belonged to me in any event. It is true that my brother moved out in about 1974 or 1975 but I do not accept that I locked him out or forced him to move. Since he moved out the first and second floors have been empty. The rooms were not fit to let. About three months after my brother moved out, the tenant of the top floor premises also moved out, and since that time the top floor premises have also been empty. They also are not fit to let. My brother could have moved back in at any time and was quite free to do so as far as I was concerned."
I will deal first with the issue as to the 1965 transfer. In his oral evidence, Mr. U.S. Lohia repeated what he had said in his affirmation. He had no reason to give his father his interest in the house. He continued to contribute to the mortgage payments after the date of the alleged transfer until the mortgage was finally paid off in 1967. Whilst he could not believe that his father had forged the transfer, he had never signed one. His evidence was not shaken in cross-examination. There was no other oral evidence relevant to this issue.
I have not found this issue at all easy to resolve. It is difficult to see any good reason why Mr. U.S. Lohia should have transferred his interest in the house to his father. Mr. J.S. Lohia did not, in his affirmation, suggest one, nor did he answer Mr. U.S. Lohia’s affirmation. However, I do not think that I can place on weight on this, since I was not able to gain any real idea from the evidence whether Mr. J.S. Lohia’s involvement in his father’s affairs was such as to make it likely that he would have known the reason for the transaction between his father and brother, if there was one. Nor do I think that any weight can be placed either on Mr. U.S. Lohia’s possession of the deeds or on his failure to respond to the letter from the Islington Legal Advice Centre. Quite apart from any language difficulties, it would be unreasonable to expect a layman to understand the distinction between a joint tenancy and a tenancy in common. From the time when he did consult a lawyer in 1982, the available correspondence is consistent with his case.
On the other hand, it seems to be accepted on both sides that relations between Mr. M.S. Lohia and his two sons were amicable, and that during his lifetime there was peace in the house. As Mr. U.S. Lohia agreed, there is no plausible reason why his father should have sought to appropriate his interest in the house, forging his signature for that purpose. Yet the letter from Michael Temkin & Co shows clearly that they understood that the intention was that Mr. M.S. Lohia should be the "sole proprietor." Mr. Sahonte has not been able to suggest any reason why he should have given false instructions to his solicitors. I have considered the possibility that some other member of the family, or some other third party, could, by purporting to act as interpreter between Mr. M.S. Lohia and the solicitor, have duped both, and also forged the signature of Mr. U.S. Lohia. But there is not a shred of evidence to support this, and it seems very far-fetched.
In the end, I think that the explanation that the transfer was fraudulent is the less likely of the two possibilities and, whilst I feel no certainty on this issue, I find on the balance of probabilities that there was as Mr. Geldart submitted some kind of family arrangement which led to the transfer being made. It seems inconceivable, especially in view of the detail Mr. U.S. Lohia was able to give about the circumstances surrounding the purchase of the house in 1965, that he could have forgotten about a transfer in 1971, and I must therefore further conclude, again on the balance of probabilities, that he was unwilling to explain the nature of the arrangement which led to the transfer.
Mr. Sahonte submitted that even if, contrary to his primary submission, I find that Mr. U.S. Lohia did transfer his interest to his father in 1971, there was no change in the beneficial interest; a resulting trust arose in Mr. U.S. Lohia’s favour, either by the operation of a presumption because the transfer was gratuitous, or upon consideration of all the evidence.
It is therefore necessary to consider first whether a resulting trust is to be presumed from the undoubted fact that the transfer was for no value. Such a presumption would have arisen before 1925: see Dyer v Dyer (1788) 2 Cox Eq. 92, 93 per Eyre CB. It still would apply (in the absence of evidence to the contrary) in the case of chattels or other personal property: see Fowkes v Pascoe (1875) 10 Ch. App. 343, 345, 348; Tinsley v Milligan [1994] 1 A.C. 340, 371 per Lord Browne-Wilkinson. The question is whether, in the case of land, the presumption has been abolished by section 60 of the Law of Property Act 1925.
Before the Statute of Uses 1535, a voluntary conveyance without a declaration of use in favour of the grantee gave rise to a resulting use in favour of the grantor. The effect of the Statute of Uses was to execute the trust so that the conveyance did not operate; the legal estate returned or "resulted" to the grantor, who thus retained it. Therefore, where the grantor intended to make a gift of the property, the conveyance was expressed to be for the use or benefit of the grantee: see Elphinstone’s Introduction to Conveyancing 7th ed. 1918 pp. 12-3, 82-3.
Section 60 of the Law of Property Act 1925 provides as follows:
"(1) A conveyance of freehold land to any person without words of limitation, or any equivalent expression, shall pass to the grantee the fee simple or other the whole interest which the grantor had power to convey in such land, unless a contrary intention appears in the conveyance ...
(3) In 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."
Mr. Geldart submitted that the effect of these provisions is that there is no longer any presumption that a voluntary conveyance of land gives rise to a resulting trust. There appears to be no decision on the point. In Hodgson v Marks [1971] Ch. 892, 933 Russell L.J. referred to "the debatable question whether on a voluntary transfer of land by A to stranger B there is a presumption of a resulting trust." In Tinsley v Milligan, supra at 371, Lord Browne-Wilkinson said that it was "arguable that the position has been altered by the 1925 property legislation." Mr. Sahonte submitted that the immediately following passage in his speech Lord Browne-Wilkinson supports the view that the presumption has not been affected by section 60(3), but I do not agree.
The fullest and most recent discussion of the point is to be found in Chambers on Resulting Trusts 1997, pp. 18-9:
"There has been much speculation about the effect of subsection 60(3) of the Law of Property Act 1925. The majority opinion seems to be that this section prevents the presumption of resulting trust from applying to gratuitous conveyances of land. The counter-argument is that, under the Statute of Uses, the expression of the use was needed solely to pass the legal estate and the presumption of resulting trust would apply independently of the expressed use. Therefore, by stating that "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," subsection 60(3) merely permits the expression of the use to be dropped without any significance being attributed to its absence, i.e. the vestiges of the use are removed without affecting modern trust principles in any way. This reading would have the advantage of ensuring that the presumption of resulting trust remains uniformly applicable to essentially similar apparent gifts, regardless of the nature of the property or form of the transaction.
Notwithstanding the immediate appeal of this interpretation, a plain reading of subsection 60(3) tends to favour the other view. Although the presumption of resulting trust is attracted by the lack of consideration provided by the recipient and not the expression of the use, the section only applies to "a voluntary conveyance." This suggests that some fact, in addition to the lack of consideration, is necessary before the presumption can arise. If a sufficient additional fact is that the parties are strangers, i.e. not in a relationship giving rise to the presumption of advancement, then there is room for the presumption of resulting trust. If there must be "some other reason for thinking that the grantor did not intend the grantee to take beneficially," [the reference here is to Lewin on Trusts, p.116] then the presumption is excluded. The presumption is in no more than an "inference of fact to be drawn in the absence of evidence to the contrary" [the reference here is to Pettit v Pettit [1970] AC 777, 823 per Lord Diplock] and, therefore, it no longer applies to gratuitous transfers of land if subsection 60(3) requires that evidence indicating the transferor’s intention be given.
Either view of subsection 60(3) could reasonably be adopted by the courts, but two things should be kept in mind. First, there is no logical necessity that certain facts give rise to certain inferences of intention, but it is important that people in essentially similar situations are not treated differently without good cause. It is doubtful whether the differences between land and personalty and between methods of making apparent gifts provide meaningful bases for distinction. Secondly, a decision that the presumption of resulting trust no longer applies to gratuitous transfers of land will not make the resulting trust inapplicable. The presumption is only an inference of the provider’s lack of intention to benefit the recipient and it is permissible to prove that fact even where it is not presumed (except, perhaps, where the intention is illegal)."
I agree with Mr. Chambers’ view that, on a plain reading of section 60, the presumption has been abolished. It seems to me that section 60(1) establishes a general rule that a conveyance should be construed according to the words it uses, so that is possible to tell from it who holds the legal and beneficial estate in the land. Consistently with this, section 60(3) provides in effect that a voluntary conveyance means what it says; it is not necessary to use additional words to make it effective. It is likely that by 1925 the suspicion with which gifts of land were formerly viewed, which was at least one of the underlying reasons for the presumption, would no longer have been regarded as material, and that the purpose of section 60(3) was accordingly to do away with the presumption of a resulting trust in the cases of voluntary conveyance and to make it necessary for the person seeking to establish a resulting trust to prove it. Another consideration is that section 60(3), unless so construed, would be something of a trap for the unwary conveyancer, since the suggestion implicit in its wording that it is no longer necessary to use the old formula would be misleading, except in cases in which the presumption of advancement applied.
As against all this, the countervailing consideration that section 60(3) on this view would change the law with regard to real property alone and therefore would lead to different conclusions in relation to real and personal property in the same situation, does not seem to me to be a factor of sufficient potency to displace the natural construction of the section.
Accordingly, I hold that a voluntary conveyance does not give rise to a presumption of a resulting trust. This view appears to be supported by the weight of academic opinion, albeit without any such detailed analysis as to be found in Mr. Chambers’ work: see Snell’s Equity 30th ed. para. 9.20; Halsbury’s Laws of England vol. 48 para. 613; Riddall The Law of Trusts 5th ed. 1996 p.224; Maudsley and Burn Trusts and Trustees 8th ed. 1996 pp.215-6; Keeton and Sheridan The Comparative Law of Trusts in the Commonwealth and the Irish Republic 1976 p.262; Hayton and Marsh Commentary and Cases on the Law of Trusts and Equitable Remedies 10th ed. 1996 p.307; Williams on Title 4th ed. p.644. I have not been referred to, nor have I been able to find, any textbook or academic article which supports the contrary view.
Next, I must consider the second part of Mr. Sahonte’s submission on this issue, namely that upon a consideration of all the evidence, including the absence of value, it is unlikely that Mr. U.S. Lohia intended to benefit his father, and that there was therefore a resulting trust. He relied on section 53(2) of the Law of Property Act 1928, and on the decision of the Court of Appeal in Tribe v Tribe [1996] ch. 107, which undoubtedly establish that a resulting trust can be inferred, in appropriate circumstances, from the factual evidence before the court. He submitted that, in addition to the fact that the transfer was for no value, the absence of any sensible reason why Mr. U.S. Lohia should have given his share in the house to his father, together with his uncontradicted evidence that he continued to own the property jointly with his father until his father’s death, and that he continued to contribute to the mortgage payments and to share in the rental income from the house, supported the inference of a resulting trust. I agree that in some circumstances this might be so but, having reached the conclusion that there was some kind of family arrangement about which Mr. U.S. Lohia was unwilling to speak, I do not think that I am in a position to draw such an inference. It is also difficult to imagine why the transfer should have been effected at all if there was no intention to change the beneficial ownership, and the terms of Michael Temkin & Co’s letter of 4th August 1965 suggests albeit not conclusively that there was such an intention. In my opinion, the continued sharing of mortgage payments and rental income, on an informal basis, does not provide a sufficient foundation in the circumstances for the inference of a resulting trust. On the contrary, in my view the evidence as a whole leads to the conclusion, on the balance of probabilities, that a transfer of the beneficial interest was intended; this conclusion would displace the presumption of a resulting trust if, contrary to my view such a presumption survives section 60(3) of the Act.
It follows from the above that I must hold that Mr. M.S. Lohia was the beneficial owner of the house at the time of his death and that it formed part of his estate.
Turning to the exclusion issue, Mrs. Lohia said in her affidavit:
"4. I feel that problems started from the day my father-in-law. At that time, my husband was out of the house most of the day working very long hours as a bus driver having finally got a job in London Transport. I was on my own with my children - I had three of by then. I recall that whenever I went out, if the Defendant was at home, he would bolt the door behind me and then refuse to re-admit me. I had to wait until my husband came home or some other member of the family left, and I would then get in. On various occasions my husband got locked out, possibly because the Defendant meant to lock me out. I would find that when I was out, my things had been gone through and things would be missing from the kitchen. On a number of occasions I found urine in my pots and pans. When I was at home, I felt a lot of hostility. The Defendant would come upstairs and bang on the doors. I would be subjected to abusive language. The defendant would say rude and unpleasant things to me. I would do my cleaning and cooking in the morning and then go and sit in the park for the rest of the day until my husband was due home and then I would go back so that we could be together.
5. The gas and electricity were both operated by coin meters. If, during the day, the gas ran out the Defendant would not allow me to put money in the meter and I would have to wait until my husband came home, or I would go and eat at my sister’s house. The Defendant would not allow my children to play in the garden or let us hang out our clothing to dry. I had to put clothing over the fireguard and water would drip into buckets.
6. The Defendant also put a lock on the outside of the bathroom and kept it locked. None of us were allowed to use it.
7. The Defendant also kept the toilet locked and would only open it when my husband returned home. I had to keep a bucket in the bedroom for myself and the children.
8. I told my husband what was going (sic). However, my husband respected the fact that the Defendant was his older brother and did not want to confront him with what he was doing.
9. However, the Defendant also prevented my husband from using the bathroom and insisted on him and the rest of the family using the public baths in Clissold Park. My husband objected to this and finally they had a fight. I was present. The Defendant grabbed me by the hair and pulled my head scarf off. This is very serious in our culture. He dragged me down the stairs. One of the Defendant’s children was involved in the fight and kicked me in the stomach. I was pregnant with my fourth child at the time. The Defendant punched my husband in the face.
10. After the fight, my husband said to me that because of the problems in the house it would be better if the children and I went to live abroad. When he was in a position to buy a house, we could then come back and live with him. As a result of this, I contacted my own sister in England and borrowed money from them as a deposit to buy the house in which I now live.
11. The reason we left the house was because the Defendant had made it clear that he did not want us to remain in it and he did everything that he could to make life impossible. We had no alternative but to go. Had it not been for the Defendant’s behaviour, we would have stayed in the same house, as it was big enough for all of us."
Her oral evidence was to the same effect, and added some detail. Apart from some discrepancies as to the time when certain incidents occurred, which I do not regard as significant, her answers in cross-examination were consistent. It became clear in the cross-examination of Mr. U.S. Lohia that he strongly disliked his sister-in-law, and indeed genuinely believed, without any rational basis, that she was responsible for the car crash to which I have referred, because it happened after a visit to Bristol to see her and her husband, and for the death of her husband as well. Nevertheless, he vehemently denied her allegations as to his conduct towards her and her husband.
It is clear that there was ill-feeling between the two families, but I am not satisfied, on the balance of probabilities, that Mr. U.S. Singh, by his conduct, drove his brother and his brother’s family out of the house. It is often not easy to decide where the truth lies between witnesses giving diametrically opposed evidence as to events long ago. It certainly was not easy in this case, in which all the witnesses gave their evidence well and were apparently credible in relation to this issue. It is however, striking that, in the correspondence before the action was brought, Mr. J.S. Lohia complained only of being locked out of the premises after he had ceased to live there and that even in his affidavit, which was also sworn much nearer the time, he said nothing about any incident involving his wife or children. If Mrs. Lohia’s evidence is true, it is very surprising that the correspondence and affidavit deal with much less serious matters, but do not mention any of the matters complained of by her which he would have regarded as the main examples of the conduct which drove him from the house. The length of time elapsing between the death of Mr. M.S. Lohia in 1971, when, according to Mrs. Lohia, the misconduct began, and her family’s departure in 1977, also makes her allegations less credible; it is likely that they would have left earlier, if her evidence was entirely true. Whilst I am far from certain, I feel some doubt about the truth of Mrs. Lohia’s evidence. The bad blood between the two families may well have contributed to the eventual decision to leave, but I am not satisfied that Mr. U.S. Lohia was guilty of misconduct which would justify me in finding that he drove or excluded his brother and family from the house.
In reaching this conclusion, I have taken into account the doubt as to Mr. U.S. Lohia’s credibility which arises from my finding on the forgery issue, and also the ill will which he evidently feels for his sister-in-law. Nevertheless, I consider that these are outweighed by the other matters to which I have just referred in relation to this allegation. The claim for an occupation rent must therefore be dismissed.
Finally, I refer to the position of Mrs. Piro Wanti. Her position is not raised by the originating summons, but in Mr. Sahonte’s written opening submissions he pointed out that she was prima facie entitled to a third of Mr. M.S. Lohia’s estate and cast doubt on the claimants’ suggestion that she had disclaimed her share of the estate.
This is based on a letter from Messrs. Earle and Waller to Mr. J.S. Lohia dated 6th March 1974 informing him that:
"... we have received a letter from Mrs. Piro Wanti in which she authorises us to distribute the estate of your late Father between yourself and your Brother.
We feel we may require some form of declaration signed before a Justice in this connection, but we can discuss this point further when you call at our offices ..."
There is no evidence that any formal declaration was ever made, but as stated earlier, the property - the sole asset of any significance - was vested in Mr. J.S. and Mr. U.S. Lohia a few weeks later, which suggests that Earle and Waller must have been satisfied that it was proper to distribute the estate without regard to Mrs. Piro Wanti’s entitlement. She lived until 1998 without making a claim.
No formality is required for a disclaimer to be effective: see Towson v Tickall (1819) 3 B & Ald. 31; Begbie v Crook (1835) 2 Bing. N.C. 70; re Birchall (1889) 40 Ch. D. 436, 439. It seems very probable on the evidence that Mrs. Piro Wanti did disclaim her interest, but I do not think that I should make any formal declaration in proceedings which do not directly raise any question as to her entitlement and to which neither she nor her personal representatives have ever been a party. I will hear counsel on the form of the order which is appropriate and on costs.