Rebutting a presumption of advancement

Evidence required to rebut a presumption of advancement

a presumption of advancement will be rebutted by evidence that the transferor (or contributor) did not intend to make a gift but wished to retain an interest in the property transferred or acquired. In Re Gooch (1890) 62 LT 384 Sir Daniel Gooch transferred shares into the name of his eldest son. The son paid the dividends from the shares to his father, who also retained the share certificates. Kay J held that the presumption of advancement was rebutted by evidence that the shares had been transferred to qualify the son to become a director of the company, and that no gift had been intended. In Warren v Gurney [1944] 2 All ER 472, a father purchased a house in the name of his daughter prior to her wedding. He retained the title deeds until his death. The Court of Appeal held that the presumption of advancement was rebutted by evidence that at the time of the transaction the father had intended her husband to repay the money. The retention of the title deeds was considered a very significant fact, as ‘one would have expected the father to have handed them over either to [his daughter] or her husband, if he had intended the gift.’

In McGrath v Wallis [1995] 2 FLR 114, a house was acquired for joint occupancy by a father and son in the sole name of the son. The purchase price was provided partly by proceeds of sale of the father’s previous house and partly by means of a mortgage. The Court of Appeal held that the presumption of advancement was rebutted by evidence that the father had intended to retain an interest in the ownership of the house, including an unsigned declaration of trust which would have shared the beneficial ownership in the proportions represented by the deposit and mortgage respectively.

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