LORD DENNING M.R. Mr. and Mrs. Bedson were married in 1949. He was a regular soldier serving in the Life Guards on 22 year engagement. They lived in married quarters and have three children aged 13, 11 and 9. He attained the distinguished and responsible rank of Corporal of Horse. In 1960 he retired. He was awarded a grant of 2,000 [pounds and he had in addition savings of about 3,000 pounds. He had been able to save this amount by extra work done by him in designing badges and heraldry. On his retirement he wished to set up in business, and after looking round he decided to buy a draper’s business at 62/63 Cliff Hill, Gorleston, Great Yarmouth. The property was freehold, with a shop on the ground floor and a flat above. He paid 2, 750 pounds for the freehold, 250 pounds for the fixtures and fittings, 250 pounds for the goodwill and 1,089 pounds for the stock. Total 4, 339 pounds, all paid pout of his own money, leaving him very little left. The contract was in his own name but when it came to drawing up the conveyance for the freehold, the solicitor’s assistance suggested tot eh husband that it should be taken in the joint names of himself and his wife so as to avoid death duties if anything happened to the husband. The conveyance was dated October 14, 1960 and said that “in consideration of 2, 750 pounds now paid by the purchasers to “the vendor, the vendor as beneficial owner hereby conveys unto “the purchasers all those freehold shops and premises Nos. 62 and 63 Cliff Hill, Gorleston, to hold the same unto the purchasers in the fee simple as joint tenants” and by clause 2 the purchasers declared that the purchasers shall hold the said property upon trust to sell the same with power to postpone the sale thereof and shall hold the net proceeds of sale and other money applicable as capital and the net rents and profits thereof until sale upon trust for themselves as joint tenants.
It should be noticed that this document was in the regular form for conveyances to two persons as joint tenants and that it contained nothing as to the shares of husband and wife. It did not say that the proceeds of any sale were to be divided equally or two-thirds to one-third, or anything of that kind. It was therefore not a tenancy in common, but a simple joint tenancy, both owning the whole property jointly, and not a separate share each. It was quite a suitable arrangement for husband and wife who looked forward to the whole future of their lives jointly together. No severance was contemplated at all. Indeed, the express purpose was that on the death of one, the survivor should have a right to the whole. The documents was sent by the solicitor to the husband and wife to sign. It was not explained to them. The choice of language, said the judge, can have meant very little to husband or wife.
On October 14, 1960, husband, wife and children went in. the husband used up his remaining capital in buying stock for the business. They carried on the business together, the wife helping in the shop, and the husband doing all the management. They employed an accountant each year to get out the accounts. At first the account were made up as if they were partners in the business, but, later on, that view of their relationship was recognized by both tot be erroneous . The accounts were afterwards drawn up on the basis that the business belonged to the husband; that the wife was employed at a salary of 3 pounds a week: and that the property itself belong to husband and wife in equal shares. This was better for tax purposes and was more in accord with the true position. It is now acknowledged that the business itself, that is, the goodwill, stock-in-trade, fixtures and fittings belong to the husband. But the query arises as to the freehold which was in joint names, and shown in the accounts as belonging to each in equal shares.
In 1963 the wife’s mother inflicted herself on them. She was a disturbing influence. The wife gave up helping in the shop. On September 9, 1963, the wife deserted the husband, taking the three children with her. She went to live in a house in the neighborhood and herself went out to work at a factory, earning 9 pounds a week. On November 18, 1963, she complained to the magistrates that the husband had deserted her and had willfully neglected to provide her with reasonable maintenance. On January 15, 1964, the magistrates dismissed the complaints. They awarded the wife no maintenance but they ordered the husband to pay 2 pounds and 10s. a week for each child, making 7 pounds and 10s. a week in all. He has regularly paid this sum, though it has been a great strain on his resources. He has lived himself most frugally in order to make both ends meet. The 7 pounds and 10s. was so difficult that the magistrates reduced it to 6 pounds a week; and this he has just managed to afford.
On September 17, 1964, the wife applied to the county court under section 17 of the Married Women’s Property Act, 1882: and she asked for an order that the premises, together with the fixtures and fittings, car, stock and goodwill be sold and the proceeds divided between the husband and wife in equal shares.
The county court judge rejected the wife’s claim. He thought it was fair and just that he bulk of the beneficial interest should belong to the husband, but that the wife had for short period given some material assistance in building up the business. He thought that 275 pounds was a fair sum to allow her for this: and on the husband paying her that sum, he ordered the wife to execute all necessary documents to vest the property in the husband.
The wife appeals to this court. She asks for an order for sale of the house and business and that the proceeds be divided between them equally. She obtained legal aid to pursue her appeal, and counsel appeared for her. But the husband had no legal aid. He conducted his case in person. He had to shut up the shop for the day in order to come here. When we said we would reserve judgment, he asked that he might be excused from attending on the judgment because it would mean shutting up his shop for the day and this he could not afford to do. I would like to say that he struck me as a sensible and responsible man whose effort to keep his home and business together are worthy to be commended. He told us that he had managed to borrow from relatives the 275 pounds which the county court judge awarded to the wife. But he could find no more. The wife’s counsel suggested that it should be increased to 1,000 pounds, but the husband said he could not possibly find it, and if it were ordered, there was no alternative but for the house and business to be sold.
The case raises an important point of law. The wife claims that the right of herself and her husband to the property were established once and for all by the terms of the conveyance of October 14, 1960 and that the court has no power to vary them in these proceedings. She says that she is entitled to insist on a sale of the property and that the proceeds be divided between them in equal shares.
We had some discussions as to the powers of the court under section 17 of the Act of 1882. In have myself in the past preferred to give it a liberal interpretation in keeping with the width of the words used by Parliament. But those who are wiser than I am have declared that it does not enable the court to vary existing rights. We have always to go back to see what the rights of the parties actually are. I accept this but I cannot help remarking that it is often impossible to find out what the rights of husband and wife really are as between themselves. When they acquired the property they contemplated life together and not separate with any disputes to be solved by agreement between themselves, and not by recourse to the courts. Their arrangement did not result in legal rights: see Balfour v. Balfour. In such a case where the existing rights cannot be ascertained, the court can only do what the statute says it should do, make such order “as it thinks fit”. In the words of Lord Upjohn “an equitable knife must be used to sever the Gordian knot”, see National Provincial Bank v. Hastings Car Mart Ltd.
It is very common to find a dwelling-house conveyed to husband and wife jointly with a declaration of trust for themselves on trust for sale with power to postpone the sale, and to hold the proceeds of sale-and the income pending sale-on trust for themselves as joint tenants. The purpose is that it should be the matrimonial home for them and their family. The rights of the parties in such a case were considered in Smith v. Smith and Brown v. Brown. This is the position as I understand it:
1) The Husband and wife hold a joint tenancy of the legal estate in the house. This cannot be severed. One of them cannot sell his share separately (as he used to be able to do) and thus convert it into a tenancy in common. If they sell the house, they must both join in the sale. If one dies, the survivor takes the legal estate, see section 36 (2) of the Law of Property Act, 1925.
2) The husband and wife are joint beneficiaries of the beneficial interest in the house. They are jointly entitled to possession of the house and to the use of it. Neither can turn out the other: see Bull v. Bull and if one leaves the house, he or she has the right to return to enjoy it. If one dies, the survivor takes the sole beneficial use: se section 36 (1) of the Law of Property Act, 1925.
3) So long as the house is in the possession of the husband and wife as joint tenants or one of them, there can be no severance of their equitable interests: see section 36 (1) (3). Neither of them can sell his or her equitable interest separately. If he or she could do so, it would mean that the purchaser could, of his own head, destroy the right of survivorship which was the essence of the joint tenancy. That cannot be correct.
4) They may together sell or let the house by mutual consent; and if they do so, then the trust comes into effect. They take the proceeds of asel or the rent, jointly for their joint benefit on such proceeds of sale, or the rent jointly for their joint benefit on such terms as they may mutually arrange between themselves.
5) No letting or sale can be effected by one without the consent of the other, except by order of the court of Chancery, which “may make such order as it thinks fit”: see section 30 of the Law of Property Act, 1925. The court will consider whether it is right and proper in the circumstances that an order for the sale should be made: see in re Buchanan Wollaston’s Conveyance (Curtis v. Buchanan-Wollaston), by Lord Greene M.R. In considering whether it is right and proper to make an order for sale, the court will have regard to the purpose for which the joint tenancy was created, no matter whether the purpose was expressed in the instrument or was merely tacit. Thus, if the purpose was that the house should be the matrimonial home, the so long as the wife arbitrarily to insist on a sale. It will sequence the contemplated purpose is dead, then the trust for sale will take effect, subject always to the discretion of the court to postpone it: see Jones v. Challenger.
6) If the wife deserts her husband and leaves the matrimonial home, the court will not order a sale as her request where it would be inequitable so to do. The husband id entitled to bring a suit for restitution of conjugal rights and on making a decree, the Divorce Court ma “if it thinks fit” order a settlement to be made of the her interest in the property for the benefit of the husband: see section 24 of The Matrimonial Causes Act, 1950.
7) The conveyance is a “post nuptial settlements” with the result that, after pronouncing the decree of divorce, the Divorce Court can make such order with reference to the application of the property as the court thinks fit” see section 25 Matrimonial Causes Act, 1950It ca. it can delete the trust in favour of the two jointly and substitute a trust for one or other absolutely and order possession accordingly: see Brown v. Brown.
Applying these principles we have here a case where the house was acquired for the joint purposes of husband and wife as a married couple: the first floor as the matrimonial home for the family to occupy, the ground floor as the business where husband and wife were to work so as to provide for the family. In considering whether an order for sale should be made, the court must undoubtedly have regard to those purposes. It will not allow one party to defeat them, or either of them, by arbitrarily insisting on a sale. In the words of Delvin L.J. in Jones v. Challenger, “it is at any rate wrong and inequitable for one of the parties to the trust to invoke the letter of the trust in order to defeat one of its purposes, whether that purpose be written or unwritten, and the court will not permit it” if we were to allow the wife here to insist on a sale, it would enable her to defeat both the contemplated purposes. On the one hand, to destroy the matrimonial home and thus remove any chance of the family coming together there again, and , on the other hand, to destroy the business by means of which the husband is still providing for himself and his children. The wife demanded that this be done. The county court judge recorded the argument on her behalf in these words: “The wife’s solicitor argued that nevertheless the choice of language adopted by the conveyance (which can have meant very little to husband or wife) is such that I am inescapably bound to hold that as from the signing of the document the wife was fully entitled in law to determine the joint tenancy unilaterally by deserting her husband, and thus to achieve his ruin by demanding that the business and property be said up an done half of the proceeds “paid to her”. The county court judge rejected this view. So did I. the wife is not entitled to invoke the letter of the trust in order to perpetuate such an injustice. Equity can and will stop in to prevent it. The court can look at the purposes for which this property was acquired; and finding that a sale would defeat those purposes, the court can refuse tom order to order it.
I would add another reason for refusing an order for sale. The husband is not yet in a position to petition for divorce. The wife has not been in desertion for three years. He may however, hiring a suit for the restitution of conjugal rights, and on a decree being made, he will be in a position to ask that her interest in the property be transferred to him. Alternatively, at the end of the three years, he may bring a suit for divorce and on the decree being made, he will be entitled to apply to vary the terms of the conveyance, so as to have the property vested in him free of the declaration of trust. If we were to order a sale now, it would effectually defeat these inchoate rights which he has. In this situation the husband should be allowed to remain in the property and continue the business so as to have the property vested in him free of the declaration of trust. If we were to order a sale now, it would effectually defest these inchoate rights which he has. In this situation the husband should be allowed to remain in the property and continue the business so as to provide for the family as he is doing. The wife will suffer no injustice. She has no money invested in the business. She has only her interest as joint tenant; and she cannot be allowed to insist on a sale which will ruin him.
II. Section 17 of the Act of 1882.
If I am right in saying that, apart from section 17 the wife has no right to insist on a sale, it is quite plain that that section does not give it to her. It says that: “In any question between “husband and wife as to the title to or possession of property, either party...... may apply by summons or otherwise in a summary way to any judge.....and the judges...may make such order with respect to the property in dispute.... As he shall think fit.” Those are the self-same words as in section 30 of the Law of Property Act, 1925, and section 25 of the Matrimonial Causes Act, 1950. If the court on a substantive motion under section 30would not think fit to order a sale, a fortiori under the procedure under section 17 it would not order a sale.
But even if the wife had an established right, by virtue of the declaration of trust, to insist on a sale, then section 17 enables the court to restrain the exercise of that right or to postpone it if the justice of the case so demands: see National Provincial Bank v. Hastings Car Mart Ltd. by Lord Hodson and by Lord Wilberforce. In particular, when the court is considering the question of possession or occupation of the matrimonial home, it will be very slow to make any order concerned with the legal rights of the partners which might have the effect of depriving either wife or husband of the right to occupy the matrimonial home: see the observations of Tucker L.J. in Stewart v. Stewart which were quoted with approval by Lord Upjohn and Lord Wilberforce in the House of Lords. It is on this footing that the court has repeatedly refused to order a sale of the matrimonial home or home or to order one spouse out of it at the request of the other: see Cobb v. Cobb and Short v. Short and the restrained even the one who is the owner from selling it: see Lee v. Lee which was approved in the House of Lords by Lord Hodson, Lord Cohen and Lord Upjohn.
So here I have no doubt that in this application under section 17 the court is not bound to order a sale at the instance of the wife, but may refuse it if the justice of the case so demands. Justice certainly does so demand. It is quite unacceptable to me that this wife, who has deserted her husband, should be entitled to insist on a sale of the property and bring him to ruin. He ought to be allowed to remain there and carry on his business there at any rate until Divorce Court has been able to consider whether or no some provision should be made for his benefit, under section 24 or 25 of the Matrimonial Causes Act, 1950.
The case is entirely different from Rawlings v. Rawlings, because the wife there had money invested in the property. The majority of the court thought it right and proper that she should not be able to exclude her from it altogether. Here the wife has no money invested in the business at all.
III. what is the wife’s share?
Although the court refuses a sale, we are asked to determine what it is the wife’s share in the property. I do not think that the fact that they were joint tenants means that on a sale she necessarily takes a half share. That is decisively shown by the decision of this court in Hine v. Hine. I would refer particularly to the observations of Pearson L.J. in Wilson v. Wilson, on the ground that the conveyance in Hine v. Hine did not contain in express declaration of trust for the two jointly, but I for myself assumed that it did., because a declaration of trust is common form: see Smith v. Smith, Brown v. Brown and section 36 (1) of the Law of Property Act, 1925. The mere insertion of a declaration of trust (which would be imported anyway) cannot make any difference. Notwithstanding the criticisms that have been made in Hine v. Hine, it is, I think still good law. In that very case Pearson L.J. pointed out that a half-and-half division would not have produced a fair and just result, whereas decisions of this court did achieve a reasonable result. I would myself hesitate long before I overthrew a case which did justice: but suffice it to say that it is binding on this court, and none of us can overthrow it.
In this situation I have had great doubt whether we should interfere with the decision of the judge, who relied on Hine v. Hine, but my brethren think we should, and I concur on the ground that there is solid ground for believing that the parties did intend that, come what may, the proceeds of the sale of the property (when it should happen) should be shared equally. I say this, because of the form of the latest accounts which were agreed by the husband with the accountants after the disputes had arisen. They showed the property as belonging half-and-half to each.
IV. Ought the husband to pay something?
The final question is whether the husband should be ordered to make any payment to the wife. I have no doubt that, when on a joint tenancy the court refuses to order a sale, it can order the party in possession to make a payment to the other. Just as in Appleton v. Appleton, the husband had to pay a rent for the use and occupation of his wife’s house, so here the husband can be ordered to pay something to the wife in respect of her joint interest. But he is already paying her all he can afford by way of allowance for the children-6 pounds a week. I think the most he should be ordered to pay his wife, in respect of her joint interest, is 1 pound a week. If he cannot manage this, in addition to the 6 pounds.
The county court judge thought that the husband should pay his wife 275 pounds and that on hi paying that sum, she should assign her interest to him. I do not think it is right in these proceedings to determine the ultimate fate of the wife’s interest. That should be determined in proceedings under section 24 or 25 of the Matrimonial Causes Act, 1950. We were told that the 275 pounds is at present in the names of the solicitors. It should be returned to the husband. But he should, as from the date of the judgment, pay 1 pound a week to the wife in respect of her joint interest.
V. Conclusion
I think we should reuse an order for sale of the property but the husband ought to pay 1 pound a week to the wife, as from this date, in respect of her joint interest. I think the husband should be given an opportunity of taking proceedings for restitution of conjugal rights or, after three years, for desertion, and be able to get the property rights adjusted in those proceedings.
On further point: I am of opinion that, while husband is in possession of the house, there can be no severance of the joint tenancy. The wife cannot sell her interest separately. In case I am wrong about this, I think we should make an order restraining the wife from doing so. It would be quite intolerable that she should, for instance, be able to sell her interest to her mother and get her turn him out. The jurisdiction in this behalf is amply covered by Lee v. Lee, which has been approved by the House of Lords. I agree with the form of order which Davies L.J. will propose.
DAVIES L.J. At the hearing of this appeal, Mr. Otton, for the wife, abandoned all claims in respect of the goodwill of the business, the stock-in-trade and motor car, the profits and the furniture. So that the wife’s sole remaining claim is in respect of the freehold premises, 62/63 Cliff Hill, Gorleston. She claims 50 percent, interest in these premises or their value.
The wife’s claim is based on the terms of the conveyance dated October 14, 1960. By that the property was conveyed to the husband and wife jointly. By clause 2 (a) the purchasers declared that “the purchasers shall hold the said property upon trust to sell the same with power to postpone the sale thereof and shall hold the net proceeds of sale and other money applicable as capital and the net rents and profits thereof until sale upon trust for themselves as joint tenants.” And it is submitted for the wife that the court has no power under section 17 of the Married Women’s Property Act, 1882, to go behind the declaration of trust or to decide that the rights of the parties in and to the property or its proceeds are other than as there stated.
As I understand the argument, it was conceded that a mere conveyance into joint names would not have this conclusive effect and that in the present case the declaration of trust is conclusive. And it is submitted that Wilson v. Wilson which of course, is binding on this court, is really a decisive authority in favour of the wife.
The facts of the case, which have been fully set out by my Lord, are not altogether usual. The county court judge accepted the husband’s evidence in preference to that of the wife. It is not disputed that the whole of the money for purchase of the property, the goodwill, stock and furniture was provided by the husband, who indeed appears to have sunk the whole of his substantial savings and gratuity into the venture. The form of the conveyance was adopted on the advice of solicitors in order that in the event of anything happening to the husband the wife should take by survivorship, and vice versa, with the consequent effect on the incidence of estate duty. There was, of course, no discussion or agreement between the parties as to what should happen in the event of a break-up of the marriage. There never is “As to the property itself, said the judge, this was conveyed (on the solicitor’s assistant’s suggestion) into the joint names so as to avoid death duties if anything happened to the husband. I rejected any suggestion that there was at any time any express or implied agreement that the business and property should forthwith belong tot eh husband and wife equally or indeed at all. There was no agreement express or implied as to what should happen if the marriage broke up; such an event was not contemplated by either at the time. The wife’s solicitor argued that nevertheless the choice of language adopted by the conveyancer (which can have meant very little to husband or wife) is such that I am in escapably bound to hold that as from the signing of the documents the wife was fully entitled in law to determine the joint tenancy unilaterally by deserting her husband and then to achieve his ruin by demanding that the business and the property be sold up and one half of the proceeds paid to her..... in the present case I reached the conclusion that it cannot clearly be seen that the parties intended or agreed that, come what may, the business and property should be shared equally.”
Wilson v. Wilson is, of course, a strong authority in favour of the wife in the present case. But I do not understand the judgments in that case. But I do not understand the judgments in that case, certainly not those of Ormerod and Donovan L.JJ., as laying down that the terms of Ormerod of trust are conclusive. For myself I can see no distinction in principle in this respect between such a declaration of trust and a mere conveyance into joint names, which is admitted not to be concerned it is not necessary for the purposes of the present case to consider. In this connection we were referred to the recent decision of the House of Lords in National Provincial Bank Ltd. v. Hastings Car Mart and in particular the observations of Lord Upjohn and Lord Wilberforce. The present case, however, concerns the personal rights of the spouses inter se.
From the many and sometimes conflicting authorities the principle in my judgment, emerges that in proceedings under section 17 between husband and wife the form of a transaction is not conclusive. In inquiring into the title to property the court must investigate the reality of the situation and, having done and having ascertained the facts, must make such order as it thinks fit. So that whatever the documents may appear to say on their face, the court may reach the conclusion that in reality by express or implied agreement the true position was something different from that appearing on the face of the documents. Unless, however, the court is satisfied on evidence that the parties expressly or by conduct did agree to a state of affairs other than that indicated by the documents, then the documents must prevail. It may be that it is more difficult to go behind a declaration of trust than a conveyance. It may be that practical difficulties may arise in any given case. But I do not think that there is any authority for the proposition that in no circumstances as between husband and wife, where no third party interest is concerned, can the court look behind the form of the documents in the present case the husband on the advice of his solicitor took the conveyance in the joint names of himself and his wife and they entered into the declaration of trust. Prima facie, therefore, the wife is entitled to a one-half share. Indeed, unless the spouses were jointly entitled, the express object that the survivor should take in the event of the death of one of them could not be achieved. How then is this prima facie position or presumption to be rebutted? The county court judge accepted the husband’s evidence that he never intended his wife to have any interest in the property. But from first to last it has the form of the conveyance, the wife should have no interest in the property. Quite obviously the matter was never discussed. And there appears to have nothing in the conduct of the parties from which such an agreement could be inferred. In these circumstances the document must, in my judgment, prevail. In other words I am of the opinion that eh judge approached the question from the wrong angle. He asked himself the question whether there was any agreement that the property should be whether there was any agreement that it should not be so owned. And there was none.
In my regretful opinion, therefore, the wife is entitled to a half interest in the property. I say “regretful: because it is obvious that the husband has provided the whole of the money for this undertaking, has sunk the whole of his small fortune in it and is now in some considerable financial difficulty.
The very difficult question then arises as to what is the proper order for the court to make in the circumstances. I do not think that any great assistance in that matter is afforded by Rawlings v. Rawlings. We are, of course, bound by the decision of the majority in that case, though for myself, with great respect to all concerned, I see great force in the views expressed by Wilmer L.J. in his powerful dissenting judgment. But Rawlings is clearly distinguishable from the present case. There the wife was asking for a sale; here the wife’s counsel does not press for a sale, though he asks for some form of security. There each party provided substantial sum towards the purchase of the property was here the wife did not provide a penny. There the property was a residential bungalow only: here the property includes a shop, which is the husband’s only source of income.
For similar reasons I do not think that Jones v. Challenger, affords any guide in the present case. For there, too, the parties had provided the purchase price of the property in equal shares , and there also the property was purely residential, and no question of business premises arose. It it to be observed that in that case Donovan L.J. in his dissenting judgment suggested that there might be a difference between the powers of the court under section 17 of the Married Women’s Property Act, 1882, and those under section 30 of the Law of Property Act, 1925, though by both sections the court might well under section 17, while a marriage is still subsisting, approach such a problem in quite a different manner from that in which it would deal with an application under section 30 of the Law of Property Act, 1925.
On all the facts of this case I am strongly of the opinion that the court ought not to think fit to make any such order as would result in the husband being turned out of the premises or would give to the wife any security which in the hands of an assignee might have the same result.
The proper order in my judgment would be to the following effect. Declare that the wife is entitled to a beneficial interest in the freehold property equal to that of the husband. Refuse a sale and order that the wife do not assign, pledge or otherwise deal with her interest without the leave of the court. Order that the husband so long as he remains in occupation do pay to the wife 1 pound per week. Liberty to either party to apply the order of the county court judge that the husband should pay 275 pounds to the wife should be set aside.
It will be a matter for the husband hereafter to decide whether in the event of his taking successful proceedings for restitution of conjugal rights, divorce or judicial separation he should make application under section 24 or section 25 of the Matrimonial Causes Act, 1950, in respect of the wife’s beneficial interest in the property.
RUSSELL L.J. so far as the goodwill, stock, profits and trade fittings of the business are concerned, counsel for the wife found himself unable to urge more than faintly that the wife could have any interest or right in them. Plainly she had not because the idea of the wife being a partner in the business was by agreement between husband and wife scrapped retrospectively in May, 1962. That part of the judge’s order cannot stand.
This leaves next the question of the beneficial interest in the freehold house, consisting of a residence over the shop and the shop storerooms, which was the family home until wife, in September 1963 left, taking the children with her. The husband contracted to buy the house at the same time as the business. The conveyance was to husband and wife as joint tenants on trust to sell with an express declaration of their beneficial interests as joint tenants in the common form, as in Wilson v. Wilson.
Survivor took all by the original limitations and not by right of accretion. This flows from the conception that husband and wife were one person. Technically the freehold was in the husband but he had not the ability as against the wife to dispose of the [property. It is perhaps not without interest that the Married Women Property Act, 1882, itself turned for the future, tenancies by entireties into ordinary joint tenancies: see Thornley v. Thornley.) suppose the beneficial joint property the matrimonial home and the wife or husband go bankrupt, whether during amicable continuance of the marriage or after separation, the bankrupt’s estate would include the equal beneficial interest nonetheless, and the consequent involuntary assignment would sever the beneficial joint tenancy. This would result from the effect of the bankruptcy laws and the inherent nature of the interest created. Without doubt the trustee in bankruptcy would have been entitled to an undivided half in the present property had either wife or husband at any time been adjudicated bankrupt. Similarly either husband or wife could in my judgment at any time by voluntary assignment or sale or mortgage of his or her beneficial interest have created a tenancy in common in undivided shares: or could have done so by notice: see the Law of Property Act, 1925, s. 36(2).
I am unable to accept the legal proposition of Lord Denning M. R. that when husband and wife are joint tenants of the legal estate in the matrimonial home and also beneficial joint tenants in respect of it, neither can, so long as one is in possession, sell his or her beneficial interest therein or otherwise sever the beneficial joint tenancy. The proposition is, I think without the slightest foundation in law or equity. If anything, it appears to be an attempt to retrieve to some extent the long defunct tenancy by entireties which, as I have already remarked, was doomed by the Married Women’s Property Act, 1882, itself. It may indeed be that either the wife’s claim in this case or the notation in the business accounts of the husband of her interest has long since operated as a severance. Moreover, it may well be that in any event a severance automatically results from a declaration of her beneficial interest as equal to that of her husband: a mortgage or charge of his interest by a beneficial joint tenant operates as a severance: the wife is legally aided on this appeal with a small contribution: the result of the appeal will have been to recover or preserve for her beneficial interest: any contributions not paid and any outlay by the Legal Aid Fund in excess of contributions is, I believe, a first charge on that interest vested in the Law Society and enforceable as if created inter parties: see section 8 (4) of the Legal Aid and Advice Act, 1940, and the rules thereunder.
The constitution of a beneficial joint tenancy in this case was in my judgment just as much an established title in the wife to property as would be the case had the beneficial trusts expressed been as tenants in common in equal undivided shares, and I do not consider that there is jurisdiction, whether under section 17 of the Married Women’s Property Act, 1882, or otherwise, to take from the wife that which is her property and give it to her husband, except under the statutory jurisdiction on a matrimonial decree to vary settlements or to order a settlement of the property of a guilty wife.
In arriving at (or rather adhering to) these views I find support in the views expressed in the House of Lords in the recent case of National Provincial Bank v. Ainsworth (the Hastings Car Mart case). In that case Lord Hodson said: so long as she has “not forfeited her rights the courts have often intervened to protect the wife’s rights to live in the house which she and her husband have occupied together. Proceedings are available under section 17 of the Married Women’s Property Act, 1882, which enables questions between husband and wife to be decided in a summary way. The court has intervened by injunction to restrain a husband from entering into a contract for the sale of the house while his wife and children are living there until the husband provided suitable alternative accommodation: Lee v. Lee, where the Court of Appeal confirmed an order of a county court judge tot hiss effect. Even after a separation has been judicially pronounced and the spouses are released from their obligation to live together the court has exercised its discretion to make an order in relation to property, since the subsistence of the marriage tie is sufficient to counter jurisdiction: Hutchinson v. Hutchinson. Questions have arisen in considering the extent of the discretion of the court under section 17 of the Act of 1882, but broadly speaking the view is accepted that the court has a discretion to be exercised in the interest of the parties to restrain or postpone the enforcement of legal rights but not to vary agreed or established rights to property in an endeavor to achieve a kind of palm tree justice.” Lord Cohen and Lord Guest made no express reference to the section 17 jurisdiction. Lord Upjohn said; “ Apart from this, however, I cannot understand how a purely procedural section such as section 17 can confer any new substantive rights on either of the spouses. The section provides a very useful summary method of determining between husband and wife questions of title and the right to possession of property. With all respect to [Lord Denning M. R.] I am of opinion that he has put a fa too wide construction on this section 17: the judge should have a free hand to do what is just.’ In the recent case of Hine v. Hine, he said of the section; its discretion transcends all rights, legal or equitable.......’ I prefer the approach of Delvin L.J. in Short v. Short. The powers of the court under section 17, as the learned Lord Justice said, are substantially the same as in any other proceeding where the ownership or possession of property is in question. The discretion of the court is no wider and no narrower than the ordinary discretion of the court in such cases. In Cobb v. Cobb, Romer L.J. said: ‘ ...... I know of no power that the court has under section 17 to vary agreed or established titles to property. It has power to ascertain the respective rights of husband and wife to disputed property and frequently has to do so on very little material; but where, as here, the original rights to property are established by the evidence, and those rights have not been varied by subsequent agreement, the court cannot, in my opinion, under section 17 vary those rights merely because it thinks that in the light of subsequent events the original agreement was unfair.’ See also the observation of Russell L.J. in Wilson v. Wilson. Title must be decided as a matter of fact and law; but there will be many cases where after years of happy married life frequently with one common banking account to which both contribute and no one taking much heed as to who pays for what the ownership of property has become so inextricably entangled or become legally incapable of solution that an equitable knife must be used to sever the Gordian knot: in re Rogers’ Question and Rimmer v. Rimmer are typical examples. But when once the relevant document has been construed or the rights as to title determined by judicial decision on the available evidence, as must be necessary (if possible) in the first place, no further question of discretion on questions of title arise. Questions of possession must of course still be determined having regard to the mutual matrimonial duties of the spouses. Depending as they do on a too wide construction of section 17, I would not myself regard the recent cases of Hine v. Hine and Appleton v. Appleton as correctly decided. In the former case the intention of the parties was clear assuming the county court judge correctly interpreted the legal effect of the discussion as to avoiding estate duty (and I have no reason to doubt that he did); in the latter case the husband could have no claim on property which he knew to be his wife’s by doing work on it, in the absence of some agreement. Furthermore, I cannot myself see how this section which is purely personal between husband and wife (though the section may be invoked by the company in whose books the disputed property stands) can be used to confer upon the wife, just because she has been deserted by her husband, any rights against third parties. That the section was available in proceedings against third parties was, however, apparently assumed (though, in my opinion, wrongly) without serious argument, in Jess B. Woodcock and Sons Ltd. V. Hobbs.”
Lord Wilberforce said: “Of course, this is not the end of the matter, nor is the position which I have stated necessarily decisive of the attitude which the courts should adopt when faced with conflicting claims between husband and wife as to the right to occupy a particular property. The courts in their equitable jurisdiction have been flexible in dealing with such disputes. The machinery by which they can be so is provided by section 17 of the Married Women’s Property Act, 1882. The section, omitting immaterial portions, reads as follows: ‘in any question between husband and wife as to the title to or possession of property, either party....may apply by summons or otherwise in a summary way to any judge of the High Court of Justice.......[or of the county court] ....and the judge....may make such order with respect to the property in dispute....as he thinks fit, or may direct such application to stand over from time to time, and any inquiry touching the matters in question to be made in such manner as he shall think fit.
This section has proved itself as one of very general utility and it would be undesirable that anything said here should circumscribe its usefulness. What is material for present purposes is, first, to observe, that it only applies as between husband and wife themselves, including probably their legal personal representative (there is additionally power to bring in banks or companies whose books or registers relate to bring property in dispute but this does not touch the point I am making), not as between their respective successors in title, secondly, the section has been treated, rightly in my opinion, as conferring upon the court power, without disturbing established property rights, not to allow those rights to be fully enforced where to do so would run counter to the duties of one spouse to another. This use of the section may be illustrated by the case in the Court of Appeal of Stewart v. Stewart. The husband, by proceedings under the section, sought possession of premises belonging to him where he had been cohabiting with the wife. There were divorce proceedings pending based on allegations of the wife’s adultery. The judge had made an order for possession and the Court if Appeal refused to interfere with his exercise of discretion, but made it clear that, in their opinion, the jurisdiction was discretionary. I quote a passage from the judgment of Tucker L.J.: ‘There is jurisdiction in the county court judge under this section to make an order for possession at the instance of husband or wife against the other spouse; but the cases do show that whether in that form of proceeding or in some other form of proceedings by a husband against a wife or a wife against husband, where the court is considering the question of possession or occupation of the matrimonial home, it will be very slow to make any order concerned with the legal rights of the parties which might have the effect of depriving either wife or husband of the right to occupy the matrimonial home. The cases show that, whether an injunction or some other form of relief is being granted, great care must be taken in a normal case, where a marriage is subsisting, where the parties have made by the Divorce Court or by the justice touching on the right of the one spouse to live apart from the other, that the rights of a wife or husband should be safeguarded in the form of the order made. I do not think that the cases go beyond that. The reference will be noted to ‘form of proceedings [see section 17] or in some other form of proceedings may be. I may refer to Shipman v. Shipman, a case where the wife was seeking relief in respect of some property of hers under section 12 of the Married Women Property Act, 1882, which allowed a married woman to sue her husband for the protection of her property. An injunction was granted, but Pollock M. R. said of the doctrine of a court of equity: that while protecting the property of a wife as a proper subject for protection, we must also regard the duties of spouses to each other, and he had regard to the fact that the conduct of the husband would justify the wife in resisting a suit for restitution of conjugal rights. The position then, at the present time, is this. The wife has no specific right against her husband to be provided with any particular house, nor to remain in any particular house. She has a right to cohabitation and support. But, in considering whether the husband should be given possession of property of his, the court will have regard to the duty of the spouses to each other, and the decision it reaches will be based on a consideration of what may be called the matrimonial circumstances. These include such matters as whether the husband can provide alternative accommodation and if so whether such accommodation is suitable having regard to the estate and condition of the spouses: whether the husband’s conduct amounts to desertion, whether the conduct of the wife has been such as to deprive her of any of her rights against the husband. And the order to be made must be fashioned accordingly: it may be that the wife should leave immediately or after a certain period: it may be subject to revision on a change of circumstances”; and later be said: “While the property remains that of the husband he holds it subject to the right of his wife to invoke the discretionary jurisdiction of the court (whether under section 17 of the 1882 Act or otherwise) to have regard to the mutual rights of the spouses.”
It is of course, true to say that the Hasting Car Mart case was concerned with the existence or non-existence of that which had been labeled “the deserted wife’s equity,” and that it cannot be taken as a decision of the House of Lords on section 17 of the Ac of 1882. Nevertheless, the position in law of husband and wife in relation to real property was most thoroughly canvassed: three of their Lordships considered it relevant to form and expressly state a view on the scope of section 17: neither of the other two thought it necessary or desirable to sound a note of caution or reserve on the subject. I do not think these views are obiter dicta stated without full consideration.
On these grounds, in my judgment, the wife is entitled to a declaration that she has a beneficial interest in the premises equal to that of her husband. The fact that it was the matrimonial home and that she may be in desertion cannot affect her right to that declaration.
But then comes the more difficult question whether a sale should now be ordered. Prima facie the power to postpone a sale must be exercised jointly, and if one trustee declines to exercise the power, the trust for sale is in terms mandatory and immediate, and should be executed by the court. Section 30 of the Law of Property Act, 1925, is however, regarded as conferring upon the court, when an application is made by a person interested for execution of the trust for sale, some discretion whether or not, and if not upon what terms or conditions, to order a sale. I refer to Jones v. Challenger and the authorities and principles there discussed. In a case such as the present when the parties are husband and wife I think it may broadly be said that similar considerations would be relevant as are relevant in dealing with possession under section 17 of the Married Women’s Property Act, 1882, when the marriage is still (at least in form) subsisting: for execution of the trust for sale necessarily involves surrender of possession, and as was confirmed by statutory recognition in 1958, the powers under section 17 include power to order sale.
What are the facts of the present case which may be relevant to a decision as to sale and surrender of possession by the husband? First: the wife left the matrimonial home in September, 1963, taking the two young children. Second: thought she obtained in December, 1963, an order for maintenance of the children against the husband, she failed in her application for maintenance for herself: this may be taken by us as prima facie evidence of desertion by her: and though matrimonial misbehavior is not relevant to the ascertainment of property entitlement under section 17, it may be relevant under both that section and section 30 of the Law of Property Act, 2925, to the timing of sale and possession. Third: the property includes not only living accommodation for the husband but also the shop which, according to his statements to this court, by its exiguous profits affords him a bare living and ability to keep up the maintenance payments for the children. Fourth: when the housing and supporting the family, including the children. Fifth: though it may seem unlikely, having regard to the passage of time and her continued absence even after failing to get maintenance for herself, it is not impossible that the marriage may be constituted: no evidence on this point was led, and one can never tell. Sixth: on a decree for a divorce the conveyance would be capable of variation under section 25 of the Matrimonial Causes Act, 1950, as a post-nuptial settlement (see Brown v. Brown) and if the wife is in desertion it will be open to the husband in September, 1966, to petition for divorce. Seventh: if the husband applies for a decree for restitution of conjugal rights-which he is entitled to do at any time-and succeeds, the court will have power under section 24 of the Act of 1950 to settle the wife’s interest in this property for the benefit of the husband and children, a power which, of course, is also exercisable in the event of the husband obtaining a decree for divorce or judicial separation. No doubt-if the wife is guilty-the court would be inclined towards exercise of such powers by the fact that the whole cost of the acquisition was borne by the husband.
In the light of all those facts I would not be prepared to order a sale at this juncture at the instance of the wife. Nor would I be disposed to require in the particular circumstances of this case as a condition of its postponement the payment of any periodic sums by the husband to the wife in respect of his de facto sole occupation and her beneficial interest. He told us at the Bar that the profits of the business would not stretch to any such payment and that he could not avoid a sale if such a condition was imposed: and I see nothing in the evidence to suggest the contrary. The 275 pounds which his solicitor has ready to comply with the judge’s order is, he told us, borrowed money. Moreover, regard may be had to the general position at law of a co-owner in sole occupation of the property in circumstances which do not amount to exclusion of the other co-owner-as is prima facie the case here. He was under no obligation to pay an occupation rent, and was accountable only for a share of rents and profits actually received, which does not include profit made by him by the employment of his own industry and capital: thus at law the husband would not have been accountable for nay part of the profits made by him by carrying on his business on the premises, but would be accountable for a half share of any profits made, for example, by letting rooms: there is no suggestion that there have been any such last mentioned profits. See as to all this Henderson v. Eason. I make these general references as relevant to a consideration whether it would be right to impose a condition on the deferment for the time being of a sale. In so doing I do not consider it necessary for that purpose to investigate any partition action to set against a co-owner in sole occupation an occupation rent: as to which reference may be made to Hill v. Hickin, and cases there mentioned. Nor do I think it necessary for that purpose to consider whether accountability for an occupation rent could in fact be established on the footing that the husband is , as is the wife, not only co-owner but also trustee: as to which reference may be made to in re Landi, George v. Navani, and Halsbury’s Laws (3rd ed., Vol. 32), paras 520 and 521.
On the whole question of present sale, I consider that the facts are very different from those in Rawlings v. Rawlings.
I would, therefore, favour an order setting aside the order below: declaring that the wife is entitled to a beneficial interest in the property equal to that of the husband either as joint tenant or tenant in common: and declaring that this court does not think fit now to order a sale of the property.
My brethren propose to include in the order an injunction restraining the wife from selling or otherwise disposing of her declared beneficial interest in the property. I do not consider that such an order should be made. My first reason is that not only such an order never sought by the husband, but the possibility of it ever being made was not mentioned at the hearing so that counsel for the wife had no opportunity to argue that there is no jurisdiction to make the order: or whether if there be jurisdiction it should be exercised on the facts of this case: or to discuss the relation of such an order to any charge that may arise on the beneficial interest of the wife in favour of the Legal Aid Fund. To proceed thus does not accord with my own conception of the proper administration of justice. My second reason is that I do not, as at present advised, consider that there is jurisdiction to make such an order.
The purpose of the order may be said to be threefold: (a) To prevent a step which would make it impossible to exercise hereafter in respect of her beneficial interest the jurisdiction to settle property of a guilty wife under section 24 of the Matrimonial Causes Act, 1950. Under this head it is to be observed that section 5 of the Matrimonial Causes (Property and Maintenance) Act, 1958, enables the court, in matrimonial proceedings involving (inter alia) in application by the husband for settlement of the wife’s property, to set aside a disposition by her of property made with the intention of defeating such an application, if such disposition was made within three years before the application and was not made for valuable consideration to a person who acted in defeat such an application. (b) To prevent a step which would make it impossible to exercise hereafter the jurisdiction under section 25 of the Matrimonial Causes Act, 1950, to vary the post-nuptial settlement so as to divest or affect what had been the beneficial interest of the wife. (c) To prevent a third party insisting as a beneficiary on the execution of the trust for sale.
In so far as the injunction is designed to preserve the wife’s interest intact so that if the occasion hereafter arises there will be subject-matter in existence for an order under section 24 of the Matrimonial Causes Act, 1950. It seems to me implicit in decisions such as Scott v. Scott that there is no jurisdiction to grant such an injunction: and doubly so if no matrimonial proceedings are on foot. It is a necessary part of the decision of Davies J. in Hindley v. Hindley that no injunction will be granted to prevent disposal by a wife of her own property lest it be not available for the purposes of section 24. Nor, it seems to me, can the provisions of the Act of 1958 have altered that: on the contrary, the Act, in permitting dispositions to be set aside in certain circumstances, markedly did not empower the court to restrain dispositions. And the power to do so conferred by section 6 of the Matrimonial Causes Act, 1963, is only exercisable when relevant matrimonial proceedings are on foot.
In so far as the injunction is designed to preserve the situation so that the jurisdiction under section 25 may be hereafter exercised. I am ready to accept the views expressed in Hindley v. Hindley that an injunction may be granted to restrain dispositions of property comprised in a post-nuptial settlement: but I can see no ground on which such an injunction can be granted when there are on foot no matrimonial proceedings in which the section 25 jurisdiction is or can be involved.
The final question is independent of matrimonial jurisdiction whether no injunction may be granted against a wife to restrain any disposition of her beneficial interest in the matrimonial home, lest the ultimate result be that in a proper case a husband may be restrained from disposing of the matrimonial home (if it belong wholly to him) or of his beneficial interest in the matrimonial home (if the ownership is shared with the wife) in order that his wife should not be left homeless: see Lee v. Lee. But the whole basis of that sort of case is, it seems to me, that the husband has a duty to provide for his wife: and this was throughout the ground on which the deserted wife’s equity was sought to be justified. I am not aware that a wife has ever been restrained, on the general ground that kit is the matrimonial home and that she ought prima facie to be living there but is not, from disposing , lest the dispose of her acknowledged beneficial interest in the property, lest the disponce should succeed in ousting the husband. Nor am I aware that it has ever been suggested as a possibility. It does not seem to have been suggested either in Rawlings v. Rawlings or in Appleton v. Appleton, it seems to me to be one thing to decline to intervene directly at the suit of a wife by ordering execution of the trust for sale, or by ordering the husband to quit. But it seems to me to be quite another thing to restrain her from disposing of her own property when she has no duty whatever to provide her husband with a home.
Appeal allowed.
Order varied by setting aside order made
By county court judge and substituting
For it order of the court.
No costs to either side in appeal or in
Court below.