Family Law Hub

Chapman v Jaume [2012] EWCA Civ 476

  • (Thorpe LJ, Etherton LJ, Lewison LJ) 29 March 2012 


    In a tweet: There is no presumption of advancement between cohabitees

    Summary: Mr Chapman's ("C") appeal against an order that he was not entitled to repayment of monies spent on building works at Mrs Jaume's ("J") property.  

    C and J had met in the late 1990s.  J was married at the time, although her marriage was breaking down.  She and her husband separated and he moved out of the family home (“6 The Denningtons”); J remained living at the property with her three young children.  By 2001, C was largely living with J at 6 The Denningtons.  On J’s divorce, the property was transferred into her sole name.  Shortly afterwards, C paid for substantial buildings works to be carried out; these included installing fireplaces, refurbishment of bathrooms and the construction of an extension.  C put the total expenditure at £130,000 although J alleged the costs were more in the region of £60,000.    

    C and J’s relationship ended in 2006.  Three years later, C’s solicitor attempted to enter a unilateral notice at HM Land Registry on the basis that it had been agreed C would have a beneficial interest in 6 The Denningtons (the application was subsequently cancelled).  C’s solicitor also applied to enter a restriction.  J lodged an objection to that application stating that C had no interest in the property.  C cancelled his application.  Although C later distanced himself from the basis on which these applications had been put forward (blaming his solicitors), the first instance judge found that C’s solicitor had been acting on C’s instructions.  

    At first instance, the issue before the court had been what were the legal consequences of C’s expenditure.  C had claimed repayment of £162,589 being monies lent by him to J between 2001 to 2005 plus interest.  C argued that at all times it had been expressly and verbally agreed that the sums spent by C would be repaid by J either on the sale of the property or when her youngest child turned 18, whichever was the earlier.  

    J submitted that C had paid for the work in lieu of a contribution to the running costs of the household.  This was rejected at first instance as being implausible.  Insofar as C’s case was concerned, the first instance judge found:

    • that there was probably some sort of agreement, although it was unlikely that it had ever been completely or consistently expressed; 
    • that the express triggers for reimbursement were never discussed; and 
    • that had there been a precise agreement, C would have informed his solicitors of this when making his Land Registry applications.  

    C’s claim was dismissed with the result that J was entitled to retain the benefit of C’s expenditure.  C appealed.  

    Held: Lewison LJ, in giving the leading judgment, concluded that the nub of the first instance judge’s decision seemed to have been that since C had failed to prove the precise conditions about when the money should be repaid, his case had to fail in its entirety.  Given the judge had rejected J’s submissions and neither was she alleging that the monies were a gift, he found the ultimate decision reached surprising.  Having found an agreement, the obvious inference was that the monies were a loan repayable within a reasonable time after demand.  What a reasonable time was would depend upon the circumstances but here a reasonable time would have been after the property had been sold.  

    Lewison LJ highlighted the relevant authority of Seldon v Davidson [1968] 1 WLR 1083: 

    "Payment of the money having been admitted, prima facie that payment imported an obligation to repay in the absence of any circumstances tending to show anything in the nature of a presumption of advancement.  This is not a case of father and child, or husband and wife, or any other such blood relationship which could have given rise to a presumption of advancement . . . 

    "…I ask myself what is to be inferred as to the nature of the transaction when the simple payment of money is proved or admitted between strangers.  I entirely agree with my Lord that, on that bald state of affairs, proof of payment imports  a prima facie obligation to repay the advance in the absence of circumstances from which presumption of advancement can or may arise."

    J’s case that there was a presumption of advancement gave rise to a number of difficulties:

    • it was contradicted by the first instance judge’s express finding that the monies were not C’s contribution towards the household expenses and there was no allegation that the monies had been a gift; and 
    • Stack v Dowden [2007] UKHL 17 made clear there was no presumption of advancement between cohabitants.

    C’s appeal was allowed and the matter remitted to the County Court to determine the issue of quantum.  

Case note, published: 29/03/2012

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Published: 29/03/2012

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