Supreme Court

N.
										(Plaintiff)

v.

N. and C.
										(Defendants)

No. 297 of 1989
[5th of December, 1991]

Status: Reported at [1992] 2 IR 116; [1992] ILRM 27

Finlay C.J. (Hederman, McCarthy, O’Flaherty and Egan JJ concurring)
This is an appeal by the plaintiff against an order made in the High Court on 27 June 1989 by Barron J in certain proceedings instituted by the plaintiff against the executors of her deceased husband in which she claimed a declaration that she was entitled to a 50% beneficial interest in the property of the family home consisting of a house situate in the City of Dublin. The learned trial judge held that she was entitled to a one-fifteenth share only in the said premises.

The facts
The facts out of which the claim arose, which were not in dispute, no evidence being adduced on behalf of the defendants, were as follows. The plaintiff married her late husband in 1964. At the time of the marriage he was a qualified architect carrying on practice in the City of Dublin, and she was a state registered nurse who was employed in the City of Dublin.
Upon marriage the plaintiff gave up her employment so as to be a full-time wife and three children were born of the marriage, a son in June 1965, a daughter in May 1967 and a second daughter in January 1969. Except for extremely limited, temporary employment, the plaintiff did not work as a nurse after the marriage until the youngest of the children was quite grown up, and resumed employment again only in 1983. From then until 1987 she was full-time employed for a period and part-time employed for a further period as a nurse. In 1987 she ceased to be employed, apparently due to a disability.
Her husband died in April 1988.
In January 1966 the husband purchased the property concerned in this action for the sum of £5,000. That purchase money was provided from a bequest made to him by his late father and also by a further gift from his mother. He borrowed by way of mortgage on the house a further sum of £5,000 to renovate the house and convert it into apartments. The plaintiff and her husband and the one child who was then born then occupied one apartment, which the family did for the rest of the husband’s lifetime, and the balance of the house was converted into bedsitter apartments. The title of the house was in the sole name of the husband. From the commencement of the occupation of the house after it had been renovated, the evidence which was accepted by the learned trial judge was to the effect that the plaintiff took over the entire management of the bedsitter apartments which originally numbered nine, but which in 1984, when the husband moved his office to the house, were reduced to five. Throughout the entire period up to the date of the death of the husband, the plaintiff had, on the evidence, managed these apartments to the extent of making the lettings in them, dealing with complaints, collecting the rents and providing for and organising the maintenance of the apartments. At all stages the rents of the apartments would appear to have been devoted either directly or indirectly towards the payment of interest on the mortgage. In the first instance on the mortgage of £5,000, the entire of the sum went directly towards that purpose; later at periods it may have gone into a mixed family fund out of which mortgage repayments were made.
The evidence established that a total of five mortgages were raised on the premises during the lifetime of the husband, that four of them had been discharged in his lifetime and that the fifth was discharged because it was an insured endowment policy which was redeemed at his death. These mortgages were as follows:-
1.To the Lombard & Ulster Bank on 13 June 1966 for £5,000. The purpose of this mortgage was, as has   been indicated, the renovation and conversion of the house so as to create nine bedsitters and a garden flat.
2. To the Lombard & Ulster Bank in October 1966 for an unascertained sum.
3. To Allied Irish Banks for a sum of £6,000, the date of which was not established.
4. To Lombard & Ulster Bank in 1975 for £5,000.
5. To the Irish Nationwide Building Society for £15,000 in 1977. With regard to this mortgage the evidence was that it was taken out largely for the purpose of adding a single storey extension to the house.
Evidence was given that due to difficulties in the husband’s architectural practice the family’s financial situation deteriorated significantly in the years prior to his death, having been quite comfortable previously. In particular, it would appear that arrears of income tax had built up with regard to the practice which left his estate at the date of his death apparently insolvent.
For that reason steps were being taken by the husband, shortly before his death, to try and ascertain whether he could give to his wife, in the event of his death, an interest in the house which, in a sense, would be protected against debts which he had incurred. Though he was willing to execute any necessary documents to grant to her a 50% interest in the house, no transaction had actually taken place.

The judgment in the High Court
The claim for a declaration of a 50% interest in the premises was substantially based in the High Court on a submission that on the facts of the case the learned trial judge should follow the decision of Barr J in L. v. L. [1989] ILRM 528, to the effect that where a wife and mother worked in the home and rendered services of substantial value in looking after the home, providing for the husband, housekeeping and looking after the children, instead of going out to work, that, having regard to the provisions of Article 41 of the Constitution it was open to the courts in their discretion to declare such a wife entitled to an appropriate share, probably in most cases to be an equal share of 50%, in the family home. The learned trial judge rejected that submission and stated that he was unable to follow the decision of Barr J. With regard to the alternative claims, the learned trial judge concluded, firstly, that he must reject any assertion that the plaintiff by reason of her work in the home as a mother and housekeeper was entitled to any share in the family home and, secondly, that he must reject any claim arising from the wife’s activities in looking after the rented bedsitters, on the one hand, or her subsequent earnings from 1983 to 1988, on the other hand, except in so far as her original organisation and running of the rented bedsitter apartments contributed to the discharge of the interest and capital of the loan on the £5,000 mortgage which was obtained for the purpose of renovating and converting the house and except in so far as some contribution must be taken to have been made by her to the £15,000 mortgage taken out in 1977 which also yielded improvements to the house in the form of the extension. With regard to the latter contribution the learned trial judge concluded that they did no more than to keep alive a one-fifteenth interest which the original contributions, by way of management of the apartments, had made to the £5,000 mortgage which in turn had yielded an ascertained increase in the value of the premises of £3,000.

The decision
With regard to so much of the appeal as was based on an assertion that the learned trial judge erred in failing to follow the decision of Barr J in L. v L., I have just delivered judgment in the appeal which came before this Court in the case of L. v L., and have reached a conclusion, which is supported by the other members of the court, to the effect that that decision cannot be upheld. For the reasons set out in my judgment in that case I would, therefore, reject this appeal in so far as it was based on an assertion that the decision should have been followed by Barron J.
With regard to the other submissions that have been made, I have come to the following conclusions.
The reasoning contained in my judgment in L. v L. is based upon the fact that it does not appear to me that the court has got jurisdiction, by reason of the constitutional provisions contained in Article 41 of the Constitution, or by reason of any general principle to be derived from them, to make specific declarations concerning ownership of the property consisting of the family home which are derived from a principle of reward or implied benefit not known to the existing doctrines of resulting or constructive trust.
Having regard to that fact, I am satisfied that no matter how desirable it may be, that a wife who is also a mother should if at all possible work in the family home and carry out the duties involved, in particular, of rearing children there rather than be employed outside, if she does not wish so to be employed, I do not consider that it is possible from that constitutionally preferred course of conduct to construe any form of resulting or constructive trust, even on the basis, as was submitted in this case, that by so doing she made a saving to what otherwise would have been a probable expenditure from the husband’s earnings for the housekeeper or nanny, and therefore enabled him with greater facility to discharge outgoings on the house, including the repayment of mortgages raised from time to time.
For the same reason, namely, the confining of the rights to interests in the family home to the broad concept of resulting and constructive trust which would arise between persons other than husband and wife, I do not consider as I indicated in my decision in W. v W.[1981] ILRM 202, that a direct contribution, even in money’s worth, to an improvement made on the family home by a wife, where the husband is the sole owner of it, can, in the absence of express or readily implied agreement constitute a claim for a beneficial interest in it. To that extent it appears to me that the rejection by the learned trial judge in this case of a specific claim arising from the fact that the mortgage to which the plaintiff contributed, certainly, from 1983 onwards, by contributions to the family funds from her earnings as a nurse, which was used for the extension constituted an additional percentage interest in the beneficial ownership of the home, was correct.
Where, however, it seems to me the learned trial judge in this case has fallen into an error, is in his refusal to have regard to the mortgages which were raised and apparently repaid on the premises, between the initial mortgage of £5,000 in 1966 for the conversion into bedsitter apartments and the later mortgage in 1977 for the extension of the house.
In the course of my judgment in W. v W. dealing with the situation where a wife contributed either directly towards the repayment of a mortgage or to a general family fund, thus releasing her husband from obligations which facilitated his redeeming a mortgage, I stated (at pp. 204, 205) as follows:-

It is not expressly stated in the decisions to which I have referred, but I assume that the fundamental principle underlying this rule of law is that the redemption of any form of charge or mortgage on property in truth consists of the acquisition by the owner or mortgagor of an estate in the property with which he had parted at the time of the creating of the mortgage or charge, and that there can be no distinction in principle between a contribution made to the acquisition of that interest and a contribution made to the acquisition of an interest in property by an original purchase.

I would adhere to that view and its application to this case means that throughout the period of the ownership by the wife and husband of this house between 1966 and 1988, the wife has made contributions to the discharge not only of the first and fifth mortgages, as was found in the High Court, but of all the five mortgages which were raised and which have been redeemed. Those contributions consist, firstly, of the contribution by the wife throughout the entire of that period, consisting of her total management of the bedsitter apartments, the organisation and collection of the rents payable in respect of them and their general maintenance and care. Such activities are different from and not to be identified with the activities of a wife and mother in the home. Secondly, from the year 1983 to 1987, when she was earning as a nurse, she made contributions into the family fund which indirectly contributed towards the repayment of the amounts due on mortgages. This was at a time when the family finances were not as good as they had been and constituted a very important contribution.
Having regard to my view of the extreme importance on the evidence accepted by the learned trial judge of the contribution made by the wife in this case in the entire management of the bedsitter units and the position that the rental from them took in the family finances, over all the years, and having regard to the fact that I am satisfied she is entitled to credit for contribution towards the redemption of all the mortgages, it follows that the share of one-fifteenth assessed by the learned trial judge in the value of this house as being the share of the wife, is quite inadequate.
Having regard to all the considerations which are appropriate, I take the view that the proper share to which she is entitled on the facts as established and accepted by the trial judge is one-half. I would allow the appeal and vary the order of the High Court accordingly.