The Court of Appeal has partly allowed Kay Breen’s appeal over ownership of a Dundalk investment property, finding that she and her former husband, Conor Breen, acquired equal legal and beneficial interests in the property in 2000.
The court declared that a 2008 remortgage severed their joint tenancy. After Conor Breen’s death, his half share passed to his estate, while Kay Breen retained her own half. Her share is not subject to the 2008 mortgage to Bank of Ireland Mortgage Bank, the court said.
The dispute concerns 6 Distillery Mews, Distillery Lane, Dundalk, bought in the joint names of the couple for IR£190,000. Conor Breen provided IR£30,000 from his own funds, while the balance was financed by a joint AIB mortgage. Kay Breen did not contribute directly to the purchase price. The property was rented out, and the rent was used to service the AIB loan.
The High Court had ruled that Kay Breen held 42% of the beneficial interest and the estate 58%, based on their respective contributions. It also found that the 2008 mortgage severed the joint tenancy. Kay Breen appealed, arguing that the property was held equally and that she became its sole owner by survivorship when her former husband died.
Writing for the Court of Appeal, Mr Justice Robert Haughton said the circumstances at the time of purchase supported an inference that Conor Breen intended the property to be held equally. The couple remained married and had two children; Kay Breen had given up her teaching career to raise them, and there was no separation agreement or formal maintenance arrangement. The court said the evidence supported her account that joint ownership recognised her contribution to the family and their children. It concluded that the presumption of a resulting trust did not arise, or alternatively had been rebutted.
The court rejected Kay Breen’s arguments that the 2008 transaction could not sever the tenancy because of alleged fraud or unconscionable conduct. It found that Conor Breen had fraudulently misrepresented the ownership position to the bank, but said the bank had not avoided the transaction and the remortgage had legal effect to the extent possible. The court also found no basis for imposing a constructive trust or estoppel in Kay Breen’s favour.
The court varied the High Court’s orders and declared the estate and Kay Breen equal tenants in common. It did not decide who was entitled to rental receipts before or after Conor Breen’s death. The Executor and Kay Breen were each awarded their appeal costs from the estate; no appeal costs order was made for Mary Breen. The judgment invited any party seeking different orders to notify the court within 21 days, after which the proposed orders would be perfected if no notification was made.