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Etherton Notes

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Etherton [2008] CLJ 265 The difference between the institutional and the remedial constructive trust

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Etherton: term constructive trust in institutional sense = a relationship that is similar to an express trust in terms of obligations and enforcement o The court's function is merely declaratory of existing private rights
? So the constructive trust is a property institution, capable of binding third parties

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And not an equitable obligation or remedy imposed by the court o By contrast, a remedial constructive trust has features of judicial discretion and retrospectivity
? Thus, if the court feels tha other propeprietary and personal remedies are inadequate, it has the discretion to grant relief by way of a constructive trust

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And this will be deemed to have arisen at the time when the duty to make restution first arose rather than when the duty is enforced.

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Lord Millet ex judicially: o Only two situations where proprietary restituionary remedies are available
? 1. Where C can establish a continuing beneficial interest in the asset to which he claims

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i.e. on arising normally under a resulting trust
? 2. Where the original transfer is rescinded

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And specific restitution of the asset is ordered b/c monetary compensation would not be an adequate remedy. So what is the point of a common intention constructive trust?

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Etherton: For traditionalist, there is only one answer - o It is an institutional trust giving rise to property rights which pre-date the judgement
? And the judgement of the court is therefore merely declaratory
? At best the facts might give rise to proprietary estoppel

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But we're not talking relief for unjust enrichment here o Reason that constructive trust used rather than proprietary estoppel is that estoppel must be registered in order to bind purchasers
? Whereas constructive trust gets around this, giving effect to the property claims of a spouse who had neither legal title nor entitlement under and express trust.

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In Gissing v Gissing o Lord Reid: There is a difference between imputing and inferring an agreement
? If there is no evidence of any agreement, then the court cannot infer on
? But it does not exclude an imputation of deemed intention if the law permits such an imputation

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Then I am content if the law permits imputation. o Lord Morris (maj): The court cannot ascribe intentions which the parties never in fact had. o Viscount Dilhorne (maj): If a common intention is absent the law does not permit the courts to ascribe an intention to the parties they in fact never had
? And to hold that property is subject to a trust on the ground that this would be fair in the circumstances o Lord Diplock:

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