Whitlock and another (Appellants) v Moree (Respondent) (Bahamas)

Gavin Kealey QC
James Goudkamp

[2017] UKPC 44

Gavin Kealey QC and James Goudkamp appeared on behalf of the Appellants in this appeal to the Privy Council against the decision of the Court of Appeal of the Bahamas.

The dispute concerned the beneficial ownership of funds standing to the credit of a joint bank account. An elderly man (“the Testator”) joined the Respondent to his bank account shortly before his death. The Testator had contributed all of the funds in the account. Upon the Testator’s death, the Respondent contended that he was solely beneficially entitled to the funds. By contrast, the Appellants, who (like the Respondent) were beneficiaries under the Testator’s will, argued that the Respondent held the funds in the account on a resulting trust for the Testator’s estate. They did so on the basis that, because the legal interest in the funds had been transferred to the Respondent gratuitously, a resulting trust was presumed. The Appellants also contended that there was no compelling evidence that, by joining the Respondent to the account, the Testator had intended to gift the funds to the Respondent.

The Appellants succeeded at first instance, with the Chief Justice of the Bahamas holding that the law of equity presumed that the Respondent’s interest in the bank account was held on trust, and that the Respondent had failed to adduce sufficient evidence to overcome that presumption. An appeal to the Court of Appeal of the Bahamas was allowed. It held that the Chief Justice’s decision was unreasonable in light of evidence that suggested that a gift had been intended.

The Appellants appealed to the Privy Council. The Board was unanimous in remarking that the Court of Appeal had insufficient grounds for interfering with the trial judge’s findings of fact. Nonetheless, a majority (Lady Hale, Lord Sumption and Lord Briggs) dismissed the appeal on the basis that there was no scope for the presumption that the funds were held on trust due to the terms of banking documents that the Testator had signed when he had joined the Respondent to the account. The banking documents concerned contained a clause that provided, in outline, that the “property” in the account was to be held jointly. The majority made it clear that it did not matter whether the Testator had read the clause and that it was neither here nor there that the Testator may not have subjectively intended to make a gift of the funds.

The minority (Lord Wilson and Lord Carnwath) held, drawing in particular on decisions of the Supreme Court of Canada, that the clause concerned in the banking documents should not be read as dealing with the beneficial interest of funds in joint accounts. In the minority’s view, the clause simply spelled “out the consequences of holding a legal estate in a joint bank account” (at [86]).  The minority, accordingly, considered that the clause was not dispositive of the beneficial ownership of the funds and would have restored the decision of the Chief Justice holding that a gift of the funds had not been intended.

To view the advice of the Board, please click here.

Date added: December 21st, 2017


Area of Expertise

Banking & Finance
Commercial Litigation