Where purchasers make an express declaration of trust, that declaration will be conclusive “unless varied by subsequent agreement” or affected by proprietary estoppel.
In the benchmark case of Stack v Dowden [2007] UKHL 17, Baroness Hale famously said that an express declaration of trust is conclusive unless varied by “subsequent agreement” or affected by proprietary estoppel. But what did she mean by “subsequent agreement”?
Were such agreements intended to be confined to a subsequent express declaration of trust (another written trust deed), or did she mean to include a wider range of agreements, for example, informal, verbal agreements?
The decision in the present case provided important clarity on the interpretation of “subsequent agreement” in the context of express declarations of trust.
The case considered whether such agreements must comply with the formalities of the Law of Property (Miscellaneous Provisions) Act 1989 (LP(MP)A 1989) or if they can include informal, verbal agreements capable of establishing a common intention constructive trust. That is, this case considered whether “subsequent agreements” were limited to those compliant with the LP(MP)A 1989, or whether they could also include informally arising constructive trusts.