Presumption of advancement

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The presumption of advancement is a legal presumption which arises in various common law jurisdictions in relation to the transfers of money or other property. Broadly, the presumption states that where a husband transfers property to his wife, or a father to his child or someone to whom he has assumed parental responsibility, then in the absence of other evidence the court will presume that the transfer was by way of gift. [1] [2] In Australia it has also been held to apply to transfers from a male fiancé to a female fiancée. [3] In Hong Kong it has been suggested that it may also apply to an official concubine. [4]

In the law of evidence, a presumption of a particular fact can be made without the aid of proof in some situations. The invocation of a presumption shifts the burden of proof from one party to the opposing party in a court trial.

The term in loco parentis, Latin for "in the place of a parent" refers to the legal responsibility of a person or organization to take on some of the functions and responsibilities of a parent. Originally derived from English common law, it is applied in two separate areas of the law.

Evidence Material supporting an assertion

Evidence, broadly construed, is anything presented in support of an assertion. This support may be strong or weak. The strongest type of evidence is that which provides direct proof of the truth of an assertion. At the other extreme is evidence that is merely consistent with an assertion but does not rule out other, contradictory assertions, as in circumstantial evidence.

In all other circumstances the transfer is presumed to be by way of loan (in the case of money) or subject to a presumed resulting trust in the case of other property. Sometimes, less commonly, the presumption is referred to in the reverse, in that all other transfers are said to be subject to a presumption of loan.

Loan transfer of money that must be repaid

In finance, a loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations etc. The recipient incurs a debt, and is usually liable to pay interest on that debt until it is repaid, and also to repay the principal amount borrowed.

A resulting trust is the creation of an implied trust by operation of law, where property is transferred to someone who pays nothing for it; and then is implied to have held the property for benefit of another person. The trust property is said to "result" back to the transferor. In this instance, the word 'result' means "in the result, remains with", or something similar to "revert" except that in the result the beneficial interest is held on trust for the settlor. Not all trusts whose beneficiary is also the settlor can be called resulting trusts. In common law systems, the resulting trust refers to a subset of trusts which have such outcome; express trusts which stipulate that the settlor is to be the beneficiary are not normally considered resulting trusts.

The presumption has been subjected to criticism on the basis that it reflects outdated Victorian era social values, i.e. a transfer from a father or a husband is to be presumed to be a gift, but not a transfer from a wife or a mother (although in Australia it has been recognised in Brown v Brown that a wife can transfer property to her husband). [5] Others have questioned whether the presumption has any significant effect in practice. [6] Some academics have even questioned whether it is accurate to say that there is presumption of advancement at all. [7] There is no presumption of advancement between cohabiting couples (whether heterosexual or homosexual), nor between a man and his mistress. [1]

Victorian era Period of British history encompassing Queen Victorias reign

In the history of the United Kingdom, the Victorian era was the period of Queen Victoria's reign, from 20 June 1837 until her death on 22 January 1901. The era followed the Georgian period and preceded the Edwardian period, and its later half overlaps with the first part of the Belle Époque era of Continental Europe. In terms of moral sensibilities and political reforms, this period began with the passage of the Reform Act 1832. There was a strong religious drive for higher moral standards led by the nonconformist churches, such as the Methodists, and the Evangelical wing of the established Church of England. Britain's relations with the other Great Powers were driven by the colonial antagonism of the Great Game with Russia, climaxing during the Crimean War; a Pax Britannica of international free trade was maintained by the country's naval and industrial supremacy. Britain embarked on global imperial expansion, particularly in Asia and Africa, which made the British Empire the largest empire in history. National self-confidence peaked.

Social structure sociological classification of human societies according to their social characteristics

In the social sciences, social structure is the patterned social arrangements in society that are both emergent from and determinant of the actions of the individuals. On the macro scale, social structure is the system of socioeconomic stratification, social institutions, or other patterned relations between large social groups. On the meso scale, it is the structure of social network ties between individuals or organizations. On the micro scale, it can be the way norms shape the behavior of individuals within the social system.

The presumption is rebuttable by evidence. In Pettitt v Pettitt [1970] AC 777 Lord Hodson indicated that the weight to be accorded to the presumption is very slight, and that it might be rebutted by the slightest of evidence. [8] It has also been referred to as a "judicial instrument of the last resort". [9] But in the absence of any other evidence the presumption will still apply.

Both in common law and in civil law, a rebuttable presumption is an assumption made by a court that is taken to be true unless someone comes forward to contest it and prove otherwise. For example, a defendant in a criminal case is presumed innocent until proved guilty. A rebuttable presumption is often associated with prima facie evidence.


Pettitt v Pettitt [1970] AC 777 is a leading English trusts law case, concerning the presumption of advancement and a spouse's equitable interest in the matrimonial home.

Charles Hodson, Baron Hodson British judge

Francis Lord Charlton Hodson, Baron Hodson, (17 September 1895 – 11 March 1984), also known as Charles Hodson, was a British judge who served as Lord of Appeal in Ordinary from 1960–71.

The earliest known case where the presumption has been cited dates from 1677. [10]

In the Hong Kong case of Suen Shu Tai v Tam Fung Tai [2014] HKEC 1125 the Court of Appeal of Hong Kong, in obiter dicta, preferred the modern approach in that the presumption of advancement applies equally where a mother transfers property to her child. However, it left open the question of whether the presumption applies where a mother transfers property to an adult independent child. [11] [12]

Court of Appeal (Hong Kong) court of the High Court of Hong Kong

The Court of Appeal of the High Court of Hong Kong is the second most senior court in the Hong Kong legal system. It deals with appeals on all civil and criminal cases from the Court of First Instance and the District Court. It is one of two courts that makes up the High Court of Hong Kong. Sometimes criminal appeals from Magistrates' Courts with general public importance are also dealt with in the Court of Appeal, either by referral by a single judge from the Court of First Instance, or upon granting of leave on application for review by the Secretary for Justice.

Abolition

In New Zealand the presumption has been abolished between husbands and wives. [13]

In Canada the Supreme Court has held that it does not apply to gifts from a father to an adult child. [14]

In the United Kingdom provision was made to abolish the presumption in section 199 of Equality Act 2010, [15] but to date, that section has not been brought into force. A previous attempt to abolish the presumption as between husband and wife by way of a private member's bill entitled the Family Law (Property and Maintenance) Bill failed to reach a second reading in 2006. [5]

Footnotes

  1. 1 2 "The presumption of advancement". In Brief. 29 July 2015.
  2. ↑ "Presumption of Advancement Definition". Duhaime's Law Dictionary. Retrieved 31 August 2015.
  3. ↑ Wirth v Wirth (1956) 98 CLR 228
  4. ↑ Cheung v Worldcup Investments Inc [2008] HKCFA 78
  5. 1 2 Sarah Greer (18 May 2007). "Is gender bias inherent in the presumption of advancement?". New Law Journal.
  6. ↑ "Presumption of Advancement - Does it have any effect in practice?" (PDF). Law Commission (England and Wales) . Retrieved 29 July 2015.
  7. ↑ Jamie Glister. "Is There a Presumption of Advancement?" (PDF). Sydney Law Review . Retrieved 29 July 2015.
  8. ↑ "[w]hen there are no living witnesses to a transaction and inferences have to be drawn" his Lordship felt the rule may be of use, but he added "I do not think it would often happen that when evidence had been given, the presumption would today have any decisive effect", per Lord Hodson at 811.
  9. ↑ McGrath v Wallis [1995] 2 FLR 114, [1995] 3 FCR 661.
  10. ↑ Grey v Grey (1677) 2 Swans 594; 36 ER 742
  11. ↑ Michael Lower. "Presumption of advancement between mother and child in Hong Kong". Hong Kong Land Law Blog. Retrieved 29 July 2015.
  12. ↑ "Suen Shu Tai v Tam Fung Tai ([2014] HKEC 1125, CA)" . Retrieved 19 November 2019.
  13. ↑ Property (Relationships) Act 1976, section 4.
  14. ↑ Pecore v Pecore [2007] 1 SCR 795
  15. ↑ "Equality Act 2010, section 199". legislation.gov.uk. Retrieved 29 July 2015.

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