Constandas v. Lysandrou & Ors (2018) EWCA Civ 613

Facts

  • Mr. Constandas (‘C’) brought proceedings against
    his sister, Mrs. Lysandrou (‘L1’), his brother-in-law, Mr. Lysandrou (‘L2’),
    and his nephew, Michael Lysandrou (‘L3’) for a declaration that he had a 50%
    beneficial interest in a property in North London (‘the Property’) in which all
    the parties had lived for many years.
  • At the time of the proceedings, the title to the
    Property had been in L1 and L2’s names for c. 10 years and L3 was living in the
    Property. L1 and L2 were in their 80s, both suffering from dementia and were
    unable to give evidence.
  • C contended that he was entitled to a half share
    of the property on the basis that when it was purchased in 1959 for £1,200, he
    had paid half of the total purchase price, the remainder having been funded by
    way of a mortgage in L1’s sole name.
  • It was accepted by all parties that C’s claim
    was based on a resulting trust said to arise in accordance with the principles
    established by the House of Lords in Stack v. Dowden [2007] UKHL 17 and that there was a
    presumption that the beneficial ownership followed the legal ownership. The
    case turned on whether C could establish that he contributed £600 to the
    purchase price of the Property in 1959.
  • The trial judge dismissed C’s claim on the basis
    that the burden of proof fell on C and that he had failed to discharge the
    same. C appealed. One issue to be determined by the Court of Appeal was whether
    the trial judge had been justified in disposing of the case on the basis of the
    burden of proof.

Held, dismissing the appeal:

  • Resort to the burden of proof is only
    permissible in an exceptional situation where, notwithstanding that it has
    striven to do so, the court cannot reasonably make a finding in relation to a
    disputed issue (citing in approval Wilson J. in Stephens v. Cannon [2005] EWCA Civ 222 at [46]).
  • In this context, ‘exceptional’ means no more
    than that such resort is only necessary where on the available evidence, there
    is nothing left but to conclude that the claimant has not proved his case
    (citing in approval Auld LJ in Verlander v. Devon Waste Management & Anr [2007] EWCA Civ 835 at [20]).
  • The trial judge had been right to approach the
    case on the basis that it was not for L1, L2 and L3 to prove that they had had
    the money in 1959 to purchase the house or that they had, in fact, made the
    dispute payment. The burden was on C to prove that he had made the payment.
  • In the absence of any other plausible evidence
    that he had done so, C was effectively inviting the court to draw an inference
    in his favour in the absence of any other plausible source of the funds. This
    would be a bold inference, particularly in light of L1 and L2’s inability to
    give oral evidence.
  • Given that there was no positive evidence that C
    had made the payment, and considering the trial judge could not rule out that
    it had come from another source, it was inevitable that the judge concluded
    that C had not made out his case.