Yesterday I wrote about the doctrine of constructive trust and its application in property division between unmarried couples. Today I’d like to discuss the doctrine of resulting trust, another type of trust that is also applicable to unmarried spouses when dealing with property division.

A resulting trust arises when one person purchases property in the name of another, or in the names of the purchaser and another. This situation is commonly seen in transactions involving closely-related individuals, for example, two spouses.

Imagine this situation. Spouses Andy and Cindy decide to buy a home together, each contributing half of the purchase price. However, because of tax or other considerations, they decide to put the house under Cindy’s name only.

Although by law Cindy is the sole owner of the house as per the title registration, Andy is considered a beneficial owner of the property in equity. If the spouses decide to separate, Andy may claim that Cindy is a trustee of his regarding his interests in the house. In other words, if Cindy sells the house, Andy is entitled to half of the proceeds.