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Transfer of Property Rights in
Respect of Goods- Outside Sale
There are essentially 4 questions to consider in this topic:
Is a manifestation of intent alone enough to transfer rights?
If not, how do you transfer rights?
Is there a requirement of acceptance?
What is the effect on the transfer of vitiating factors (e.g. mistake, duress)?
1.Is a manifestation of intent alone enough to transfer rights?
In Land Law…
At common law, there is a requirement of a deed or registration (e.g. Pascoe v Turner).
In Trusts Law…
Explicit words are enough. S53(1)(c) is not an issue because it is not a transfer of an existing right, it is the creation of a new right.
In personal property, a manifestation of intent alone is not enough to effect a transfer. A delivery or deed is also needed (Cochrane v Moore).
Cochrane v Moore (1890)- CoA
Facts: B had title to a racehorse, Kilworth, and purported to make an immediate present gift of an undivided fourth share of that title to M. He did so by notifying Y, his trainer, who had possession of the animal in Paris, of M's share. B later mortgaged all of stable to C who, after default on the loan, sent the horses to be sold. M claimed an entitlement to one quarter of the proceeds of sale of the horse. M argued that delivery merely served as an evidentiary function, to show that a transfer was intended.
Held (Lord Esher MR): There was no effective transfer of title in the absence of any deed or delivery. C became a trustee for M of ¼ of the horse
"I have come to the conclusion that in ordinary English language, and in legal effect, there cannot be a "gift" without a giving and taking. The giving and taking are the two contemporaneous reciprocal acts which constitute a "gift." They are not evidence to prove that there has been a gift, but facts to be proved to constitute the proposition that there has been a gift."
The court's self-declaration of trust reasoning is problematic in the case:
(a) The facts of the case would seem to fall foul of Richards v Delbridge
(b) Another issue is how exactly delivery of ¼ share of a horse can practically take place
If we are talking about co-ownership, there can only be 1 title to the horse- are we really transferring?
o Only explanation might be that the donee is transferring to himself as trustee- is was trust analysis necessary for the strange facts of the case?
o But this raises problems of transferring to yourself and the other co-owner 2.What are the requirements for transferring rights?
A transfer must take place by deed or delivery.
There are 2 elements to delivery: (i) A change of possession, and (ii) an intention.
Issues of Timing
It is important to sufficiently define delivery for the purposes of clarity:
Chambers v Miller (1862)- Assizes
Facts: C's employers directed him to go with a cheque drawn on D's bank and get it cashed. He did so. While he was counting the notes, the clerk demanded the money back again on the grounds that the account had been overdrawn and the clerks were under orders not to cash the drawer's cheques. C refused and D forcibly took the money out of his pockets and returned him the cheque.
Held (Erle CJ): the moment the bankers' clerk had laid down the money or notes on the counter, in payment of the cheque, the bankers' property in the money was gone, and it could not be lawfully retaken.
Why do we need intention?
Intention is necessary since the act of delivery alone can be an equivocal act. Words effecting delivery can mean very different things. Also, possession is not often clear- it could amount to mere bailment, or a transfer of property rights.
E.g. Glaister-Carlisle: purported transferor said 'she is your responsibility now'. This could mean merely looking after the dog (bailment) or a transfer of title.
There must be an intention to make an immediate present transfer of the title. It cannot be an intention to make a transfer in the future.
Glaister-Carlisle (1968)- CoA
Facts: Husband discovered that a black male poodle over which his wife had title had mated with his white female poodle. When she told him, in anger he threw the female poodle at his wife saying 'She is your responsibility now'. Husband left wife but returned to claim what he said was his poodle.
Held (Lord Denning): His words were not sufficiently clear and unequivocal to indicate an intention to transfer his title to the dog.
To constitute a gift, the words must be clear and unequivocal.
In this case there was no suggestion that the bitch was an ordinary gift made out of natural love and affection. The conduct was equivocal.
A more problematic case is Re Cole. The words in this case, 'it's all yours' were held to be equivocalthey could mean that she could own it or simply use it as his wife. However, it is unclear what, on those facts, would have constituted an unequivocal act. Does there need to be something more
Could it be said that the court was operating on a dated presumption against the husband transferring property to his wife?
The court also overlooks the possibility that there might be joint possession in some circumstances. Would his act be sufficient to confer joint possession?
Re Cole (1964)- CoA
Facts: Husband and wife entered their new home and he covered her eyes. Removing his hands he took her round the house and said "It's all yours!". He later became bankrupt and the contents of the matrimonial home were claimed by his trustee in bankruptcy. Wife attempted to establish her title to the proceeds of sale of the chattels.
Held: gift remained unexecuted, the acts were equivocal
"I cannot find that there was any change of possession here. It is argued that a wife living in her husband's house, and therefore having control to some extent of the furniture in it,
is in possession of it, but this, I think, does not follow. In the ordinary case where a wife lives with her husband in a house owned and furnished by him, she has the use of the furniture by virtue of her position as wife, but that gives her no more possession of it than a servant has who uses the furniture" (Harman LJ)
No act of delivery has been proved, because the acts relied upon are in themselves equivocal - consistent equally with an intention of the husband to transfer the chattels to his wife or with an intention on his part to retain possession but give to her the use and enjoyment of them as his wife. (Pearson LJ)
It must be shown that A had an intention to transfer a specific right to a specific person.
E.g. A intended to transfer ownership of a £10 note to B. A, by mistake, gives B a £50 note.
A's ownership of the £50 note is not transferred to B since A did not intend to transfer that specific right to B
Cartwright v Green (1803)- Court of Chancery
Facts: Bureau was delivered to B for the purpose of repairs. B discovered money in a secret drawer and converted it for his own use.
Held (Lord Chancellor Eldon): B did not have a title to the money
"From all the cases in Hawkins there is no doubt, this bureau being delivered to the
Defendant for no other purpose than repair, if he broke open any part, which it was not necessary to touch for the purpose of repair, but with an intention to take and appropriate to his own use what he should find, that is a felonious taking within the principle of all the modern cases; as not being warranted by the purpose, for which it was delivered."
Merry v Green (1841)- Court of Exchequer
Facts: A person purchased, at a public auction, a bureau. He sent for a carpenter's apprentice to do some repairs to the bureau and whilst so engaged, the apprentice remarked that he thought there was a secret drawer. C found another in drawer in which there was a purse containing money. C gave the boy a coin in return for keeping the matter secret and converted the rest for his own use.
Held (Parke B): No delivery so as to give lawful possession of the purse and money
"It seems to use that though there was a delivery of the secretary, there was no delivery so as to give a lawful possession of the purse and money. The vendor has no intention to deliver it, nor the vendee to receive it; both were ignorant of its existence: and when the plaintiff discovered that there was a secret drawer containing the purse and money, it was a simple case of finding."
Why do we need delivery?
If no delivery took place, false facts as to title would be projected to the rest of the world. This would have consequences for creditors. Therefore, generally speaking, the recipient must be put into possession. But is this a good enough justification?
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