Re Shaire

Re. Shaire is a significant case in English property law, relating to Trusts of Land, and particularly the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA).

Facts

Mr and Mrs Shaire had separated. Mrs Shaire was in a relationship with Mr Fox. Mrs Shaire (and Mr Fox) gave Mr Shaire £15,000 for the sale of the matrimonial home and a promise to drop any further claims against Mrs Shaire. All should have been well - however, Mr Fox mortgaged the house in two further charges, forging Mrs Shaires signature on both, neither of which Mrs Shaire was aware of. Upon the death of Mr Fox, the banks in question wanted their share of the charge.

Because of the complexity of the shares of property, redemption equity and other issues involved, the question for the courts was how much, if anything, should the banks be entitled to from the estate of Mr Fox and the possible sale of the property in which Mrs Shaire and her family still lived.

Decision

The court took a more flexible view than that which had previously been available in cases such as Re Citro (1991). The decision was that Mrs Shaire and The Mortgage Company had both been victims of Mr Fox's decption. However, Neuberger J commented that the 1996 act had probably been intended "to tip the balance somewhat more in favour of families and against banks and other charges." The court also held that Mr Shaire would never have intended for Mr Fox to have a 50% interest in the property, and therefore set his share at 25%

In the circumstances, the court did not order a sale, nor did they allow the mortgage company to take Mrs Shaire on as a tenant. They instead held that the claimant's interest should be converted to a loan for Mrs Shaire to pay off over time. If she could not meet the requirements of the loan, then the court would order a sale, but only after consideration had been given to properties available to Mrs Shaire with the money that would be realised upon sale of the house.