Jones v Challenger [1961]

Court: Court of Appeal

Facts: involved a married couple who purchased a house together as their matrimonial home. Following a divorce due to the wife's adultery, the wife remarried and left the property. The husband continued to reside in the house, while the wife sought an order for sale of the property. The primary issue was whether the divorce had extinguished the purpose of the trust for sale, which was established to provide a matrimonial home, thereby impacting the husband’s ability to prevent the sale.

Held: The Court of Appeal ordered the sale of the property, determining that the collateral purpose of the trust, specifically to serve as a matrimonial home, had expired.

Key Judicial Statements: Devlin LJ explained that the presumption of sale would not prevail if there was evidence of mala fides or if it would be inequitable for one party to invoke the terms of the trust to defeat its purposes. He noted that the relevant test was whether it would be inequitable for the wife to seek her share in cash rather than whether it would be unreasonable.

On the matter of the trust’s purpose, he stated that since the property was acquired to provide a matrimonial home, the dissolution of the marriage meant that purpose was no longer valid, thus restoring the duty to sell. An order for sale was necessary to allow both parties to derive equal benefit from their investment, which was the primary objective of the trust.

Regarding the form of the order, Devlin LJ recognized there could be some discretion. If the husband needed time to secure alternative accommodation, the sale could be postponed, but he had not requested this. Additionally, if the husband was willing to buy out the wife's interest, it might have been appropriate to allow that, but he had not accepted such a proposal.

💡 Leveluplaw: illustrates how the purpose of a trust can fundamentally affect the rights of beneficiaries, particularly in a matrimonial context. The ruling clarifies that the expiration of a trust's purpose, such as providing a matrimonial home following divorce, can lead to the necessity of a property sale to ensure equitable distribution of interests.