Court rejects beneficial interest claim based on estoppel and constructive trust

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The Court of Appeal has dismissed a caretaker’s claim for one third of his wealthy employer’s property portfolio consisting of a country house, a flat and a property business comprising of two rental properties.

Jason Patrick worked for divorcee Daphne McKinley as her “housekeeper and manager”.  His role involved general maintenance duties around the country estate, as well as routine handyman work.

Over time a romantic relationship developed between Mr Patrick and Mrs McKinley. Mr Patrick’s portrayed their relationship as a committed one, both with a view to marriage and a joint business association. Mrs McKinley on the other hand maintained that from the outset she had made it clear to Mr Patrick that she was not interested in long term commitment and that there was absolutely no question of the pair jointly running her business or entering into a partnership together.

By 2008 the relationship had run its course and the pair went their separate ways.  Mr Patrick lodged his legal claim shortly after on the basis that he had an interest in Mrs McKinley’s properties where he had undertaken a significant amount of refurbishment work. He alleged that this work had given rise to a ‘beneficial interest’ in those properties based on estoppel, a constructive trust or on a quantum meruit basis.

The three properties he had worked on were together worth approximately £10m.

Mr Patrick alleged that in 2003/2004, Mrs McKinley had promised that she would share her assets with him in payment for the work he had carried out at her properties.

However Mr Patrick was not able to produce independent evidence to corroborate his position. The judge said that Mr Patrick was “an unreliable and unconvincing witness, ready to be dishonest and manipulative when faced with evidence in contradiction of his own case, making it up as he goes along and making unfounded accusations against Mrs McKinley”.

Accordingly Mr Patrick’s claim was dismissed by the court.

Mr Patrick appealed on the basis that:

  1. the judge was wrong in his assessment of both parties’ credibility as witnesses,
  2. the judge had failed to correctly analyse the evidence and
  3. Mrs McKinley’s evidence should not have been accepted on trust (although this ground was not pursued at the appeal hearing)

The Court of Appeal agreed with the High Court and rejected Mr Patrick’s evidence as dishonest.  In doing so the Court reiterated that there was no documentary evidence or independent witness evidence to support Mr Patrick’s beneficial interest claim.

This case highlights the standard of evidence required in cases where a beneficial interest claim is made involving a constructive trust or estoppel. Our expert lawyers specialise in all forms of beneficial interest actions. Call us today for a free initial chat on 0808 139 1606 or email us at [email protected]