[2025] EWCA Civ 1211

That was the clear conclusion reached in Rochefoucauld. The plaintiff owned certain estates in Ceylon, subject to a mortgage. In 1873, the mortgagees sold the estates to the defendant, who raised large sums by mortgage. The defendant became bankrupt in 1879, but obtained his discharge in 1880. The estates were then sold by the defendant or his mortgagees. The plaintiff’s case was that, on the basis of certain letters and other evidence, the defendant had purchased the estates as trustee for her, subject to a lien for his advances. The plaintiff brought an action against the defendant for a declaration that the defendant purchased as her trustee. The defendant pleaded that the estates were conveyed to him as beneficial owner. He also pleaded that the trust claimed by the plaintiff was not evidenced in writing, and relied on s.7 of the Statute of Frauds as a defence.

At trial, Kekewich J held that no trust had been proved. The Court of Appeal found that the evidence proved that the defendant purchased as trustee for the plaintiff, and held that he therefore held the estates as trustee. The Court was not convinced that the letters on which the plaintiff relied to establish the trust were insufficient to satisfy s.7, but held that even if so, parol evidence was admissible.

Lindley LJ, giving the reserved judgment of the Court, noted that s.7 required the plaintiff to prove by some writing signed by the defendant that there was a trust, and the terms of that trust. He continued, at p.206:

“But it is not necessary that the trust should have been declared by such a writing in the first instance; it is sufficient if the trust can be proved by some writing signed by the defendant, and the date of the writing is immaterial. It is further established by a series of cases, the propriety of which cannot now be questioned, that the Statute of Frauds does not prevent the proof of fraud; and that it is a fraud on the part of a person to whom land is conveyed as a trustee, and who knows it to be so conveyed, to deny the trust and claim the land himself. Consequently, notwithstanding the statute, it is competent for a person claiming land conveyed to another to prove by parol evidence that it was so conveyed upon trust for the claimant…”

The preponderance of view in academic writing in recent years appears to be that the circumstances in Rochefoucauld are better analysed as giving rise to a constructive trust, because it was unconscionable for the defendant, having acquired the estates on the basis that he would hold them on trust for the plaintiff, to deny the existence of the trust. In his article, The Nature of the Trust in Rochefoucauld v Boustead in Charles Mitchell (ed) Constructive and Resulting Trusts (2010) at p.95, Professor Swadling defends the analysis that the trust was an express one, but recognises that this is not the dominant view. A constructive trust is outside the scope of s.53(1)(b) (because of s.53(2)) and would also have been outside the scope of s.7 of the Statute of Frauds (because of s.8 of that Act). It is unnecessary to resolve that issue on this appeal, for there is no doubt that the Court of Appeal’s decision in Rochefoucauld was made on the basis that the trust was an express trust. There would have been no need to apply the principle that the Statute of Frauds may not be used as an instrument of fraud if the trust was analysed as a constructive trust, because the statute would then have had no application at all. At p.208, in the context of an argument based on the Statute of Limitations, Lindley LJ said:

“The trust which the plaintiff has established is clearly an express trust within the meaning of that expression as explained in Soar v Ashwell. The trust is one which both plaintiff and defendant intended to create. This is not one in which an equitable obligation arises although there may have been no intention to create a trust.”

The nature of the requirement for writing arose in the context of an argument advanced by the plaintiff that the Statute of Frauds had no application because the relevant estates were in Ceylon. In rejecting that argument, Lindley LJ said (at p.207):

“The statute relates to the kind of proof required in this country to enable a plaintiff suing here to establish his case here. It does not relate to lands abroad in any other way than this: it regulates procedure here, not titles to land in other countries.”

Rochefoucauld is clear authority, therefore, for the proposition that a lack of sufficient evidence in writing does not affect the validity of the trust but goes only to the question whether it can be proved as a matter of procedure of the English court. Put another way, sufficient writing is required to evidence the trust, not to perfect it. As Professor Swadling put it in The Nature of the Trust in Rochefoucauld v Boustead (above) at p.104:

“it is well established that section 7 was not a rule of validity but a rule of evidence. As the Court of Appeal itself recognised in Rochefoucauld, it was a rule describing how, if it came to litigation, an allegation that a declaration of trust respecting land must be proved.”

Rochefoucauld created an important carve-out from the protection that s.7 afforded to a trustee in relation to a trust that is not sufficiently evidenced in writing. CGC accepts that it recognised an exception to the extent that such a trust is enforceable by the beneficiary if reliance on the statute would itself be in furtherance of a fraud. It contends, however, that this has no application here, because the principle derived from Rochefoucauld applies only where property is transferred to the trustee on the basis that it will be held on trust for the beneficiary (a “3-party case”, as opposed to the position in this case, where NIOC itself declared a trust over NIOC House – a “self-declaration case”).

Mr Thanki accepted in argument that “as things stand” the Rochefoucauld principle is limited in this way, and I consider that he was right to do so. The description of the principle by Lindley LJ at p.206 of Rochefoucauld is of a 3-party case: “it is a fraud on the part of a person to whom land is conveyed as a trustee, and who knows it was so conveyed, to deny the trust and claim the land himself”. It has been confirmed as being limited to a 3-party case in Canada (Morris v Whiting (1913) 15 DLR 254, at pp.257-258) and in Australia (Wratten v Hunter [1978] 2 NSWLR 367 at pp.369-371). Those cases explain that the reason the Rochefoucauld principle applies is because a person to whom land is conveyed as trustee would not have received it but for the acceptance of the trust obligation, and equity considers it a fraud for that person to deny the trust and claim the land as his own. That reasoning does not apply in a self-declaration case, where to allow parol evidence to establish the existence of a trust, on the ground that otherwise the putative trustee would be using the statute in furtherance of a fraud, would denude the statute of all effect.