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Etherton Notes

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

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

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

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.

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

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 Where the original transfer is rescinded

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?

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

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.

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

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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