Types of trusts in land

Co-ownership

Where two or more people own the same estate in land (freehold or leasehold) at the same time

Concurrent co-ownership

Joint ownership of land by multiple people at the same time

TOLATA 1996

Statute governing co-ownership and trusts of land (in force from 1 January 1997)

Trust of land

A trust automatically imposed when land is co-owned, separating legal and equitable title

Separation of title

Division between legal ownership (trustees) and equitable ownership (beneficiaries)

Legal title

Held by trustees; registered at Land Registry; gives powers and duties of management (not enjoyment)

Equitable title

Held by beneficiaries; gives proprietary rights and entitlement to benefit from the land

Trustees

Legal owners who manage the land and execute documents like transfers and mortgages

Beneficiaries

Equitable owners who have the right to benefit from the land

Equitable interest

A proprietary right in land held by a beneficiary under a trust

Express trust

A trust of land deliberately created and declared by the parties

Formalities for express trust

Must be evidenced in writing and signed (LPA 1925, s 53(1)(b))

LPA 1925 s 53(1)(b)

Requires declarations of trust over land to be in signed writing

Example (express trust – will)

Property left on trust in a will → trustees hold legal title, beneficiaries hold equitable interest

Example (express trust – co-owners)

Parties declare shares (e.g. 75

Implied trust

A trust arising automatically from circumstances, without formalities

LPA 1925 s 53(2)

No formalities required for creation of implied trusts

Resulting trust

Arises where one person contributes to purchase price but property is in another’s name

Resulting trust shares

Usually reflect direct financial contributions (e.g. 75

Constructive trust

Arises where it would be unconscionable to deny someone’s interest in land

Common intention constructive trust

Used in family homes where parties intended shared ownership and one relied on that intention

Unconscionability

Key principle behind constructive trusts—prevents unfair denial of rights

Example (constructive trust)

One party is legal owner but both contributed → court may recognise shared equitable ownership

Trustees’ powers

Include selling or mortgaging the land, but must act for benefit of beneficiaries

Key principle of co-ownership

Legal title = control/management; Equitable title = true ownership/benefit