Updated: Mar 26, 2018
Author - Cheng Ho Man
Stack v Dowden ( UKHL 17) looked at how the beneficial ownership of property is to be determined where the legal title is held by co-owners as joint tenants and there is no express declaration as to the beneficial ownership.
The starting point is that equity follows the law and there is a presumption of a beneficial joint tenancy in these circumstances. The parties will have equal shares when the joint tenancy is severed. The presumption of equality can be rebutted (though only with difficulty) by reference to the whole course of dealings between the parties.
This essay discusses the Court’s general approach towards evidence against the presumption of equality in joint name cases. It then looks at the factors which have led the courts to decide that the presumption has been rebutted.
B. Rebutting the presumption of equality
To rebut the presumption, there must be evidence showing the parties did not intend a joint tenancy. A review of the relevant cases shows that there will be a considerable burden on whichever of the parties seeks to assert that their beneficial interests are unequal.
In Fowler v Barron  EWCA Civ 377, the family home at issue was held in joint names by an unmarried couple. Mr Barron alone paid the down payment of the purchase price and the mortgage instalments. The English Court of Appeal, however, awarded 50% of the property to Mrs Fowler.
Arden L.J., in her judgment, drew attention to Lady Hale’s words in Stack v Dowden:
“The burden will therefore be on the person seeking to show that the parties did intend their beneficial interests to be different from their legal interests, and in what way. This is not a task to be lightly embarked upon.
The effect of Stack is that a presumption of joint beneficial ownership arises from joint legal ownership.
The courts give careful scrutiny to evidence seeking to rebut the presumption of equality. In Re Chow Chung Kwan ( HKEC 2112) a married couple were joint tenants of their flat. The wife claimed to have supplied the entire purchase price and to be the sole beneficial owner. There was some evidence to substantiate this but it was very far from being compelling. It was not enough to meet the heavy burden of discharging the presumption of equality.
C. How might the presumption of equality be rebutted?
The Court has yet to give clear guidance on occasions when they will be willing to depart from the presumption of equality in joint name cases (R. George, “Cohabitants’ property rights: when is fair fair?” (2012) 71 Cambridge Law Journal 39). Ultimately, the Court is looking at the common intention of the parties when quantifying the interests of the family home. Therefore, the parties must show the existence of an express or inferred shared intention to divide the interests otherwise than equally. A number of factors may be relevant.
Expenditure on the Family Home
Differences in the parties’ financial contributions to the purchase price may or may not be enough. Particularly where the property is the family home of a married or mutually committed couple, there may be an implied understanding that ownership rights are not contingent on financial contributions. This point was made again in Re Chow Chung Kwan.
Differences in financial contribution will be less of a determining factor if it can be shown that there is an intention that each will make whatever contribution they can to the purchase of the property. For instance, in Fowler v Barron, Arden L.J. found that the parties did not care about the respective size of each other's contributions.
Separate financial lives
In Stack v Dowden, by contrast, the House of Lords did not think that the couple had an intention to share ownership equally no matter what happened. Here, beneficial ownership did reflect the parties’ respective financial contributions. The parties lived independent financial lives; each had their own savings and investments. The House of Lords took this as an indicator that the presumption of equality could be departed from.
When a mutually committed couple hold a property in joint names, there is a strong presumption of equality and the Court will place a heavy burden on the party who tries to rebut the presumption. Evidence that the parties kept their savings and finances separate may be enough. It is, however, not possible to give definitive guidance as to what evidence will be sufficient since it all boils down to the parties’ shared intentions and so is highly dependent on the facts of each case.