The High Court rejected William Kenny’s claim that the estate of his late son, Keith Kenny, held the proceeds of a mortgage protection policy on trust for him. The court did not make a repayment order: it said it would hear counsel on whether the estate should repay the €5,594.54 paid in premiums.
The judgment, delivered by Mr Justice Tony O’Connor on 12 February 2019, concerned a policy on Keith Kenny’s life. William Kenny sought a share of proceeds of about €95,000, arguing that his payments of the annual premiums gave rise to a resulting or constructive trust.
In 2000, William Kenny bought an apartment in Smithfield Gate, Dublin, jointly with his son. They borrowed IR£130,000 and were jointly and severally liable for the repayments; William Kenny paid the remaining IR£30,000 of the purchase price. He said the lender required joint ownership and mortgage protection policies. He also maintained that premiums came from an account he held jointly with his wife.
The judge noted that the two men had not specifically discussed what should happen to the apartment or policies if either died. When the apartment was remortgaged in 2007, they signed forms saying they did not wish to take out mortgage protection assurance. The existing policies remained in place but were no longer assigned to the lender.
After Keith Kenny died in 2013, the insurer confirmed that the lender had no further interest in the policy and that it had no notice of William Kenny’s interest. The defendant, Alison Kenny, was administering her father’s estate. She disputed that the policy proceeds belonged to her grandfather, arguing that the evidence pointed to a gift and that her father had taken on liability for the mortgage.
The court found that William Kenny had not shown that he intended the apartment or policy to be held for his benefit rather than as a gift to his son. As a father seeking to establish a resulting trust, he had to rebut the presumption that payments to a child were intended as an advancement. The judge said he had not explained what should have happened if he had died first, and had not settled with his son what would happen to the policy proceeds.
The court also rejected the constructive trust claim. It found no unjust enrichment of the estate from the limited premium payments and no breach of good faith by the deceased. The judgment concluded that the claim to an enforceable arrangement against the estate was far-fetched. It left the possible repayment of premiums for a further hearing, so the judgment did not determine whether that sum was recoverable.