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Dear all,

are you aware of the CA decision in Banner Homes v Luff Developments [2000] 2 All ER 117, (with a judgment on the remedy reported at [2000] 2 WLR 772)? Briefly, it involved a failed joint venture for the acquisition of land between A and B. A and B were negotiating a joint venture, under which land would be bought by a third company, X, in which the parties would then be shareholders. X had been bought off the shelf for the purpose, and pending final agreement was wholly owned by A. Between contract and completion of the sale of land, A withdrew from the joint venture. The land was then acquired by X, with A as sole shareholder.

Decision: A was held to hold the shares in X on constructive trust for A and B equally, charged for the payment by B of half the cost of the acquisition of the shares (ie, presumably half the purchase price of the land). The basis of the constructive trust was not necessarily that B had suffered any detriment, but that A had obtained an advantage from B. A's advantage being that B was kept out of the market as a potential rival purchaser.

I have two queries arising from this.

Is this a constructive trust imposed as a response to unjust enrichment?

Is there authority (in English law, in particular) for a constructive trust based on advantage to the trustee, rather than detriment by the beneficiary?

Regards

Nick Hopkins