Neutral Citation Number: [2008] EWCA Civ 1364
Case No: B2/2006/2317
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CENTRAL LONDON COUNTY COURT
His Honour Judge Levy QC 
Case No: CHY06098 
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 11/12/2008
Before :

LORD JUSTICE RIX
LORD JUSTICE WILSON 
and
LORD JUSTICE RIMER 
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Between :

	DR ALICK CYRIL ELITHORN	Appellant	
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	(1)	ALAN GRAHAM POULTER
(2)	ANTHONY CHRISTOPHER ETTLINGER
(3)	MICHAEL DAVID SMITH	Respondent	

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The Appellant, Dr Elithorn, appeared in person
Miss Caroline Hutton (instructed by Manches LLP) appeared for the Respondents

Hearing date: 15 July 2008
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Judgement
Lord Justice Rimer : 
Introduction
1.	This is an appeal by Dr Alick Elithorn, the defendant, against an order dated 13 October 2006 made by His Honour Judge Levy QC in the Central London County Court. By the order the judge made a declaration that a house at 71 Rose Hill, Oxford (“Rose Hill”), the registered title to which was then and still is in the sole name of Dr Elithorn, was held by him on a “resulting trust for the Claimants as executors and trustees of the estate of the late Madeline Cora Ettlinger solely and absolutely.” I shall, for brevity, refer to the late Mrs Ettlinger as “Madeline”. 
2.	The claimants – Alan Poulter, Anthony Ettlinger and Michael Smith – are respondents to the appeal. Mr Poulter is a partner in Manches LLP; Mr Ettlinger is the son of Madeline’s late husband George, who died in 1993; and Mr Smith was Madeline’s partner during the last years of her life. Dr Elithorn played a part in her life between the death of her husband and the formation of her partnership with Mr Smith. The judge further ordered Dr Elithorn to transfer Rose Hill to the claimants, to give up possession by 9 April 2007, to pay damages for trespass for the period of his occupation following the service of the claim form and to pay the claimants’ costs. The claimants were represented before the judge, as before us, by Miss Caroline Hutton. Dr Elithorn appeared before the judge in person, as he did before us. 
3.	Rose Hill was bought for cash in 1995. It was transferred into the joint names of Madeline and Dr Elithorn. There is no dispute that Madeline produced all the cash and that Dr Elithorn produced none. The claimants’ case at the trial was that upon completion Madeline became the sole beneficial owner, although they accept that she expected that Dr Elithorn would also acquire a beneficial interest. Dr Elithorn was the owner of a house at 1 Constantine Road, Hampstead (“Constantine Road”), which he was in the process of selling. The claimants’ pleaded case was that Madeline and Dr Elithorn:
 “intended as at the time of the purchase that their respective shares in the beneficial interest in [Rose Hill] would be determined by their actual contributions to the cost of purchase and that it was the mutual expectation of [Madeline] and [Dr Elithorn] … that [he] would in fact make a contribution of up to half the cost within a very short time of completion of the purchase out of the proceeds of sale of [Constantine Road].”
4.	In the event Dr Elithorn did not sell Constantine Road promptly – he did not sell it for over four years – and he never made any payment to Madeline towards the purchase price of Rose Hill. The claimants’ case was, therefore, that the parties’ intended arrangement was never fulfilled and so Madeline remained the sole beneficial owner, as she had been from the outset.  
5.	Dr Elithorn’s defence was that this was wrong and that he did have a beneficial interest in Rose Hill. He denied that the arrangement was of the nature asserted by the claimants. The nature of his case was not identified or advanced with precision, but it included that his arrangement with Madeline was that she had lent him half the money she provided towards the purchase price so that upon completion of the purchase he was a true joint purchaser with Madeline, although also a debtor to her for half the purchase price. He admits he did not repay her but says further that, when it was apparent that Constantine Road had not been -- and was not going to be – sold promptly, Madeline agreed that his debt need only be discharged upon his death; and in March 1997 he signed a document acknowledging that arrangement. 
6.	Dr Elithorn’s case can, therefore, be said to have been simple, although he at no point appears to have so explained it to the judge: (i) Rose Hill was purchased in joint names, although a restriction on the property register showed that they were not buying as beneficial joint tenants; (ii) he and Madeline each provided half the purchase price; and (iii) there was nothing to rebut the ordinary presumption that each had a beneficial half share.   
7.	The judge summarised his conclusions in paragraphs 71 and 72 of his judgment. They are not easy paragraphs and they provoked elaborate submissions from Miss Hutton. They can, however, be said to show that the judge accepted that Dr Elithorn became a debtor of Madeline on completion of the purchase of Rose Hill. But he also found that Dr Elithorn was only to acquire a beneficial interest in Rose Hill if and when he actually repaid the debt. As he has not repaid it, it followed that he had acquired no beneficial interest in Rose Hill. The logic of the judge’s conclusion is that Dr Elithorn remains a debtor to Madeline’s estate for half the purchase price.  
8.	Lloyd LJ granted Dr Elithorn permission to appeal on the basis that it was arguable that the judge was wrong to conclude on the evidence that Dr Elithorn was only to be entitled to a share conditional on repaying half the purchase price to Madeline. Pending the disposal of the appeal, he stayed the order for the transfer of Rose Hill to the claimants and for the giving up of possession. Since the challenge to the judge’s decision is as to his conclusion on the facts, it is necessary to look at them in some detail – something the judge did not do. I will first summarise the story as reflected in the correspondence generated by Madeline, Dr Elithorn and their advisers. I preface that exercise with the comment that the only people who could provide solid answers to the key issue before the judge were Madeline and Dr Elithorn themselves. Madeline, however, died in May 2003, over three years before the trial. But she made an important contribution to the resolution of that issue in some of the letters that she wrote.
The background by reference to the documents
9.	Dr Elithorn, now aged 87, described himself to us as having been a cross-disciplinary person. His experience includes that of a computer scientist but his professional life has been mainly devoted to work as a physician at neurological hospitals and as a consultant in adult and child psychiatry and psychotherapy. He occupies Rose Hill not just as his home but also as a base for his work on behalf of a charity called PRIME which is concerned with research within the community for the improvement of mental health. 
10.	Dr Elithorn worked professionally with Professor George Ettlinger in the 1960s in connection with an experiment designed to help unravel the neuropsychological problems which determine dyslexia and poor reading skills. He claims that the experiment was successful but that they were unable to obtain funding to develop the project further. Much later, in 1991 or 1992, when Professor Ettlinger had retired, Dr Elithorn approached him again with a view to resuming a professional association, but Professor Ettlinger declined. He wanted to devote himself to his domestic life.
11.	Professor Ettlinger was at that time engaged to be married to Madeline – then Madeline Rowe -- whom he introduced to Dr Elithorn. They did marry, but Professor Ettlinger died in December 1993. In 1994 Dr Elithorn contacted Madeline and proposed a project involving the collation of Professor Ettlinger’s scientific papers and the production of a book, which Dr Elithorn described as being to “establish [Professor Ettlinger’s] true position as one of the founders of modern neuropsychology.” Madeline agreed with the proposal. The two became friends and their friendship became close and intimate. Dr Elithorn, then 73, was estranged from his wife and lived alone at Constantine Road. Madeline, then 52, lived at Island Reach, Thames Drive, Twyford (“Island Reach”), a house she had owned jointly with Professor Ettlinger and of which she became the sole owner on his death. Dr Elithorn began to spend time at Island Reach and moved some of his possessions there.
12.	Dr Elithorn proposed marriage to Madeline but she refused. But, by 1995, what they did agree was that she was prepared to invest in a house in Oxford jointly with Dr Elithorn to enable him to live and work there. In August 1995 she also lent him £70,000 to enable him to redeem his Abbey National mortgage on Constantine Road: Dr Elithorn had told her that he was behind with his mortgage payments and that Abbey was about to repossess it. He also told her he was going to sell it and repay that debt from the proceeds.
13.	Madeline and Dr Elithorn found Rose Hill. It is a five-bedroom, freehold house with a registered title (ON97268). They instructed Cole & Cole, solicitors, to act in the proposed purchase. Contracts were exchanged on 30 November 1995. The purchase was completed on 11 December 1995. Rose Hill was transferred into their joint names and they were registered as joint proprietors at HM Land Registry on 23 January 1996, Rose Hill being given on the register as the address of each. The transfer was not in evidence: it has been lost. A restriction on the register prevented the registration of any disposition by a sole proprietor (other than a trust corporation) under which capital money was to arise except under an order of the registrar or the court. That showed merely that Madeline and Dr Elithorn were not buying as beneficial joint tenants. It provided no indication of the beneficial trusts on which they were holding Rose Hill. The purchase price was £235,000, with £15,700 paid for fixtures and fittings (total £250,700). The legal and other acquisition costs were £3,253.35. There is no dispute that all the money for the purchase was produced by Madeline. Dr Elithorn did not produce a penny. He had not yet sold Constantine Road and had virtually no money. 
14.	In March 1996 Madeline instructed Mr Young of Willmett & Co, solicitors, in connection with the preparation of her will and also, as Mr Young put it in his letter to her of 11 March 1996, about “the question of the joint tenancy between you and Dr Elithorn ….” He wrote to Cole & Cole on 29 March 1996 explaining that Madeline wanted to know whether Rose Hill had been bought by the two of them as joint tenants or as tenants in common but that “she requires the property to be purchased as tenants in common.” Cole & Cole responded by providing a copy of the registered title, following which Mr Young advised Madeline on 4 April 1996 that Rose Hill had been registered in their joint names but that the restriction meant that they held it beneficially as tenants in common and so “you can both respectively will your shares in the property.” Madeline wrote to Mr Young on 7 April 1996 thanking him for making the situation clear, adding:
“I believe [Constantine Road] will very shortly be sold, after which we can have a ‘settling up’ and calculate the proportionate shares of [Rose Hill].”
15.	That observation supports the claimants’ case as to the arrangement between Madeline and Dr Elithorn. It is inconsistent with Dr Elithorn’s case that Madeline had lent him half the purchase price, burdening him with a liability to repay that half. If that had been the arrangement, it is likely (or at least possible) that Madeline would have recognised it as entitling Dr Elithorn to a beneficial half share from the outset, whereas what she here wrote suggests that she regarded the extent of the share to which he was to be entitled as proportionate to whatever contribution to the purchase price he actually made. 
16.	In the meantime, on 4 April 1996, Dr Elithorn – and Madeline for part of the time – had a meeting with Mr Keith Foster, an accountant, a sequel to an earlier meeting on 15 March 1996. Its purpose seems to have been the discussion of the formation of a company by Dr Elithorn and the ownership of Rose Hill. Mr Foster’s note records that Madeline had bought Rose Hill for £250,000 (a rounded figure, which includes the £15,700 for fixtures and fittings) and had paid £70,000 to redeem the mortgage on Constantine Road. She had therefore put up £320,000 in all. Rose Hill was “in joint tenancy”. Constantine Road might raise £150,000 net on sale. The note continued:
“If [Rose Hill] 50/50 [Dr Elithorn] owes Madeline £125,000 + 70,000    195,000.
[Dr Elithorn] needs Capital to finance Business and Run Rose Hill.
Madeline will pay maintenance costs of Rose Hill her Investment.
If [Dr Elithorn] has loan of £75,000 from Madeline [Dr Elithorn] would owe £120,000 against house value £125,000 if 150,000 is received.
[Dr Elithorn] to Make new will immediately to ensure that Madeline is secured this to be done in conjunction with Solicitors Keith to advise if required.
Any variation of house ownership will change the figures.
Discussion of residency of house to be agreed later.”
That does not advance the issue very much, save that the “If” in the first line may be some indication that there was not yet any agreement as to the basis on which the beneficial interest in Rose Hill was to be shared. It can, therefore, also be said to be consistent with what Madeline had written in her letter of 7 April 1996.
17.	On 20 May 1996 Madeline wrote to Dr Elithorn from Island Reach. Her letter reflects that relations between them were by then chilly and that, as she had told him, she did not “wish to continue our relationship on the basis of our proposed shared existence”. His response had, she wrote, been that he still wanted “a companion/wife/housekeeper”. As for Rose Hill, she wrote that “I suppose, since the house is really mine (whatever the Land Registry entry says), I will continue to foot the bill for essential repairs and maintenance. I no longer wish to be involved in plans for a new shed (unless the existing one falls down) or a new garage (ditto).” She wrote:
“You have certainly ‘taken’ me for a great deal of money. I still don’t have the promised document stating that I put up all the money for Rose Hill, nor that I lent you £70,000 to repay your mortgage. I shall ask my solicitor to prepare such a document and hope that you will sign it. You still have many of my possessions (list attached) which I should like returned as soon as is convenient. I should like you to remove from here by 20 July your remaining possessions ….
You have to decide yourself what to do with Constantine Road. My advice would be to sell it as soon as you can; I should like repayment soon of the loan I made you. But let me know what you decide. If you choose to return to No 1 and vacate [Rose Hill], I might help with the costs involved, provided you have professional removers.”
18.	I interpret the “loan” reference in the second paragraph as being to the £70,000 loan. Madeline wrote on the same day to Mr Young for advice. She said she had been foolish the previous summer and considered herself to have been seriously “conned”. She wrote:
“You know that I had bought (for £250,000) [Rose Hill], in which a friend (Dr Alick Elithorn) was residing. You established for me that [it] was in both our names as tenants in common, although I had actually put up the whole of the purchase price. I had also lent [Dr Elithorn] £70,000 in September (I think) to pay off the mortgage on [Constantine Road], pending its imminent sale. [Constantine Road] has not yet been sold; indeed [Dr Elithorn] may have been such a difficult vendor that the would-be buyer may have given up/lost interest. The proposal was that when [it] was sold (I believe the purchaser had offered £180,000 for it), [Dr Elithorn] would repay me the £70,000. He would also pay me something towards the value of [Rose Hill], but probably not as much as half, because he has virtually no income (he made a bad pension deal) and needs some capital behind him. But our respective proportional investments in [Rose Hill] would be set out in a document to be drawn up by his London solicitor. I suppose the delay in producing such a document is due to the fact that the London sale has fallen through, so no fractions of ownership can be even guessed at. He may decide to keep [Constantine Road] after all and turn it into a lodging house, or he may decide to put it on the open market again. Anyway, the matter is protracted.
The present position is that I pay for the house and contents insurance (I asked him today to arrange to cover himself for the contents which are all his own); I have agreed to pay for all essential repairs and maintenance; he pays all other outgoings; he pays me no rent (because he has no income).
Could you please advise me? I wondered if it might be [a] good idea if you could prepare some sort of document setting out the status quo I’ve described with regard to the money, which [Dr Elithorn] could sign, thus confirming that the present situation is correctly described, and promising to repay me the £70,000, and something else towards my outlay on [Rose Hill], the exact fractions to be agreed after the sale of [Constantine Road]. …”
19.	That letter is also consistent with the claimants’ case. It refers to the loan of £70,000 in respect of the mortgage on Constantine Road. It makes no suggestion that Madeline had lent Dr Elithorn £125,350 in order for him to acquire by purchase a beneficial half share in Rose Hill and its fixtures and fittings, let alone that he already had such a half share. On the contrary, it supports the view that Madeline’s understanding of the arrangement was that, once Dr Elithorn had sold Constantine Road, he would make what contribution he could towards the purchase price that Madeline alone had put up; whereupon their respective beneficial shares in Rose Hill could be worked out by reference to their respective contributions to the cost of the purchase. 
20.	Mr Young drew up two agreements for the parties to sign, but they did not sign them. On 9 July 1996 Madeline and Dr Elithorn had a meeting with the latter’s solicitor, Anton Alexander. Mr Alexander prepared a note of it but as it is mainly directed to proposals as to what might be arranged between Madeline and Dr Elithorn it is of no direct assistance. It does not purport to record what had been agreed between them as to the beneficial ownership of Rose Hill when it was bought. That meeting led to the drawing up of some unusual documents, which were also not signed. 
21.	Nothing was resolved and Constantine Road remained unsold. In October 1996 Dr Elithorn granted a tenancy of its top floor to Mohammed Hussein, hardly the action of a man intent on an early sale. He continued to occupy Rose Hill. By the autumn of 1996 Madeline appeared resigned to the realisation that there was going to be no early repayment of her £70,000 loan; on 3 September 1996 she had told Mr Young that she could see “no alternative but to … regard the loan of £70K as an investment in a house in Hampstead!”
22.	The story moved to 1997. A letter of 18 January 1997 from Madeline to Mr Young showed that she had not told any family members about her interest in Constantine Road and Rose Hill. On the face of it, she had no interest in the former apart perhaps from that of a chargee by way of subrogation to Abbey National’s rights. Even that was in question by February 1997. Mr Young had obtained a copy of the registered title of Constantine Road which showed Abbey National still registered as a chargee. Madeline, however, knew “for a fact” (as she put it in a letter she later wrote on 7 September 1998) that the mortgage was repaid in 1995. If so, it may simply be that Dr Elithorn had omitted to have the charges register updated. Dr Elithorn’s evidence in cross-examination, consistent with Madeline’s belief, was that he had used the £70,000 loan to pay off the mortgage in full in 1995.
23.	On 24 March 1997 Dr Elithorn signed a document acknowledging his indebtedness to Madeline for £195,000. It read:
“I, Alick Elithorn, confirm that Madeline Ettlinger currently resident in [Island Reach] has out of the kindness of her heart lent me [£195,000] and that this is to be the first charge on my estate when I die.”
24.	£70,000 of the £195,000 was referable to the August 1995 loan that Madeline had made to Dr Elithorn. The balance of £125,000 equated to (approximately) one half of the cost of Rose Hill and its fixtures and fittings (the accurate figure was £125,350). The production of that document was not a unilateral action by Dr Elithorn. It was the result of a meeting between Dr Elithorn and Madeline as is shown by her faxed message to Mr Young of 30 March 1997:
“I am trying a different tack with [Dr Elithorn]: I thought I might prevail better in sorting out the mess if I had a slightly more friendly association with him, and it has produced the attached paper. (Half of £250,000 = £125,000 + £70,000 = £195,000). It’s not much, but since he hasn’t finalised his Will, it might be better than nothing. He won’t live for ever, but I hope to regularise the situation better than this before he dies. …
I asked him to register my £70K interest in Constantine Road at the Land Registry, but he refused, in case he needed to use the house as collateral to raise another mortgage/loan at any time. So perhaps you should hold off from registering a caution for the moment? ….
Meantime, I’m trying to sort out other problems at Rose Hill: [central heating], other plumbing, garden. [Dr Elithorn] has another tenant at Constantine Road, so further income.”
25.	In the course of her opening to the judge, Miss Hutton, in response to a question from the judge, accepted that Dr Elithorn signed this document at Madeline’s request (transcript, Day 1, page 124, lines 8 to 11). Consistently with that, Madeline certainly did not regard the document as meaningless or worthless. She did not, for example, react to it by saying: “This is nonsense, I have never lent £125,000 to Dr Elithorn”. On the contrary, she can be said to have affirmed the debt liability that it acknowledged. Dr Elithorn’s case was that the document was the result of their mutual realisation that Constantine Road was not going to be sold promptly and of Madeline’s agreement with him that the discharge of his debt arising on the purchase of Rose Hill could be deferred until death. Whether, as a matter of construction, the document achieved that may be open to question. But that does not matter. Dr Elithorn’s case was that that was the explanation for it; and, on its face, the document is consistent with his case that he was a debtor to Madeline from the outset. It will be seen that, following its production, Madeline began to describe her Rose Hill arrangement with him in terms rather different from those in which she had described it in her earlier letters of 7 April and 20 May 1996. 
26.	On 13 April 1997 Madeline wrote to the Oxford City Council about council tax for Rose Hill. She twice referred to herself and Dr Elithorn as joint owners of it and explained the extent to which they respectively occupied it. On 9 July 1997 Mr Young wrote to Dr Elithorn, referred to the fact that Madeline had provided the purchase money for Rose Hill and asked whether he would be prepared to transfer it into her sole name in exchange for a right to remain there as long as he wished. That did not result in any written response that we have been shown, and Dr Elithorn did not agree.
27.	Events moved into 1998, when on 8 February Madeline sent Mr Young the original of Dr Elithorn’s debt acknowledgment of 24 March 1997. She wrote: 
“You will remember that we are tenants in common of [Rose Hill], which I believe gives him the right to will away his half, unless of course his latest Will (and I understand he remakes his Will regularly) admits his debt to me.” 
The first part of that expressly recognised that Dr Elithorn already had a beneficial half share in Rose Hill; the qualification then made a point that I do not understand. But whatever Madeline had in mind, she appears to have regarded Dr Elithorn’s debt acknowledgment of March 1997 as a thing of value, which it could only be if the debt it recognised was a real one; and she asked for Mr Young’s advice as to whether a copy should be sent to Dr Elithorn’s solicitor, Mr Alexander. Madeline’s recognition that Dr Elithorn had a half share is inconsistent with her stance expressed in her letters written in 1996 that what (if any) share he might have was to be dependent on his actual contribution to her out of the proceeds of sale of Constantine Road.   
28.	Madeline’s letter also reflects that Constantine Road was still unsold and that Dr Elithorn was considering its division into two so that he could live downstairs and sell the upper part. She said she had given him another six months to leave Rose Hill but he was still there. She was considering court proceedings against him. Mr Young’s advice was that it was up to Madeline whether she sent the debt acknowledgment to Dr Elithorn’s solicitor. He advised her that as Rose Hill was held by them as tenants in common, the presumption was that they each had a beneficial half share; but he added that this presumption could be rebutted by the fact that Madeline could show that she had provided the whole purchase price. He did not, at any rate in this letter, address himself to the effect of the debt acknowledgment.
29.	On 18 September 1998 Madeline typed an important letter to Mr Young. It was apparently in response to a request from him for a statement in relation to the £70,000 loan and the purchase of Rose Hill. She referred first to the making of the £70,000 loan in August 1995, which she believed had been used to repay the mortgage on Constantine Road. She continued:
“In December 1995, I wrote a cheque … in favour of Messrs Cole & Cole … for £23,500, being the deposit for the purchase of [Rose Hill]. … My cheque … for £227,200 in favour of Messrs Cole & Cole, being the balance of the purchase price for [Rose Hill] was presented to my bank on 6.12.95. I paid the whole of the purchase price of £250,000, to which Dr Elithorn did not contribute. He has not since then repaid any part of this loan of £125,000. Although he and I are registered as tenants in common of the property, I have always paid the buildings insurance and the costs of maintenance and repair.” (emphasis supplied).
30.	In the copy of that letter in the appeal bundles, the typed figures of £250,000 and £125,000 have been altered in manuscript to £250,700 and £125,350, those being the precise figures for the whole and a half respectively of the purchase price of Rose Hill and its fixtures and fittings. We were not told whether it was Madeline who made the corrections. Madeline was again recognising that she had lent Dr Elithorn half the money applied in buying Rose Hill so that they were joint purchasers and he was a debtor to her in respect of that half. That was consistent with her letter of 8 February 1998 and with Dr Elithorn’s case. It was not consistent with the claimants’ case. Madeline, a correspondent who usually expressed herself with some care, was there apparently acknowledging that  – from the outset of the purchase of Rose Hill -- Dr Elithorn had assumed a liability to her in debt for half the purchase price (note her “since then”).
31.	At about this time Madeline was diagnosed as suffering from breast cancer. 
32.	On 30 September 1998 Mr Young applied for, and achieved, the registration of a caution against dealings with Constantine Road, the purpose of the caution being, as he told Madeline on 16 October 1998, “to protect the loan which is due to you from [Dr Elithorn] in respect of both [Constantine Road] and Rose Hill.” How the caution could legitimately protect the latter loan is a mystery. But Mr Young’s letter reflected Madeline’s own position that Dr Elithorn owed her money in respect of the purchase price of Rose Hill. The lodging of the caution infuriated Dr Elithorn. On 18 October 1998 Madeline wrote further to Mr Young, saying that “I’m prepared to wait to recover the loans until [Dr Elithorn] dies.” The use of the plural can only have been a reference to the loan in respect of Constantine Road and the loan of half the purchase price for Rose Hill.
33.	In April 1999 Madeline and Dr Elithorn had a meeting with Mr Young. The outcome was that Madeline proposed that she would remove the caution on Constantine Road if Dr Elithorn agreed that the £70,000 would be repaid to her on his death; but, as a condition of that agreement, Dr Elithorn was to transfer Rose Hill into her sole name, although he was to be entitled to live there rent-free for the rest of his life. Dr Elithorn’s response was to refuse. He asserted that the £70,000 payment had not been a loan at all, but a free gift, but rather than argue about that he said he was prepared to acknowledge such liability in his will. His counter-proposal was that Rose Hill should be transferred into his sole name under an arrangement that gave Madeline security over it for “what she sees as the whole of her investment.” The precise nature of what he was proposing was obscured in imprecision and was rejected. Madeline commented on Dr Elithorn’s letter in her letter to Mr Young of 2 June 1999, saying that “He could never hope to repay half the cost of [Rose Hill] during his lifetime nor from his Estate.”  Her “repay” can be said tacitly to have again recognised the existence of a loan.
34.	On 16 June 1999 Mr Young wrote to Cole & Cole, who had acted on the purchase of Rose Hill, and asked them whether they recalled what discussions had taken place at the time as to how it was to be held; and why Dr Elithorn had been shown as a joint owner bearing in mind he had not contributed to the purchase price. Mr Russell’s response, on 22 June 1999, was that (i) had he been aware that Dr Elithorn had made no contribution he would have advised that that be recorded in a trust deed, and (ii) the firm’s old files, including that relating to Rose Hill, were burnt in a fire at their storage facility. I do not understand Mr Russell’s first point. What sort of “trust” did he have in mind? Should he not simply have discovered the parties’ intentions as to how Rose Hill was to be beneficially owned and have made sure that they were recorded in the transfer? The inference is that he did not.
35.	On 20 June 1999 Dr Elithorn wrote to Madeline, his letter including the remark that the “last time we spoke you agreed that all you wanted was a sum of money on my death. If we are agreed that this in your eyes [is] £70,000 + £125,000 let us make sure you get what you want & that I can continue with my work in Oxford.” That was consistent with his account of the debt acknowledgment of 24 March 1997. A further, undated letter from him, following a telephone discussion with Madeline, recorded that his understanding was that: 
“you would like your investment in me returned when I die, which we expect to be the sooner. … I suggest that you put the house fully in my name and that in return you get a watertight charge for the appropriate sum. At the moment, the ball-park figure would be £320,000, but it would seem fair to me to up this a little to take account of the fact that you have paid most of the maintenance and repair costs to date. I would be responsible for all repairs and developments.”
36.	Madeline’s response, reflected in her fax to Mr Young on 27 June 1999, appeared to recognise again that Dr Elithorn had a beneficial interest in Rose Hill. She wrote:
“If you agree, and I’ll call you tomorrow to ask, I propose to write to him [Dr Elithorn] repeating that my preference is (a) for him to vacate Rose Hill and move back to London, in return for which I’d remove the charge against Constantine Road (with a declaration from him that he no longer had an interest in Rose Hill, and similarly from me re Constantine Road); (b) for him to surrender ‘his’ share of Rose Hill to me, for which I’d allow him to live out his days there rent-free, paying usual outgoings (services, insurances, etc) and I’d pay all maintenance charges ….”
37.	Madeline wrote to Dr Elithorn on 28 June 1999 putting those proposals to him. On 13 August 1999 she responded to a further letter from him, saying she wanted him to move out of Rose Hill as he could not possibly “buy her out.” She also referred to one of her earlier suggestions, namely that:
 “you stay at [Rose Hill] but sign a legal document relinquishing ‘your’ share of the house to me (which means that you would no longer owe me £125,000 or so) … I’d also like an assurance that I would recover from your estate the £70,000 I lent you for your mortgage at Constantine Road.” 
That letter is also consistent with a recognition by Madeline that Dr Elithorn had a beneficial interest in Rose Hill, which he could surrender to her, upon which his liability to pay her the “£125,000 or so” – half the purchase price – would be released. It recognised that Dr Elithorn had a beneficial half share but was under a liability in debt to repay Madeline for that half. The March 1997 debt acknowledgment was of a debt of £125,000 exactly, but the slight difference in the way Madeline here described the amount is immaterial. She was obviously referring to the same debt as the March 1997 document.
38.	In a further letter of 6 October 1999 to Beatrice Lebow, a solicitor who had taken up the cudgels on Dr Elithorn’s behalf, Madeline referred to Dr Elithorn’s “notional half-share” of Rose Hill. On 1 November 1999, however, Ms Lebow herself wrote to Mr Young saying that “Dr Elithorn does not dispute that [Madeline] provided the full purchase price for [Rose Hill], I think there may have been a misunderstanding on this point.” She said the same in her letter of 15 November 1999: 
“Although [Dr Elithorn] does not dispute that [Madeline] paid for [Rose Hill], he does contend that it was put into joint names because [Madeline] gave him a half share as a gift. This is further evidenced by the fact that they are tenants in common ….”
39.	That admission, and assertion, was inconsistent with Dr Elithorn’s case at the trial, at which he abandoned any suggestion of a gift. And Miss Lebow was also apparently unaware of any suggestion that Madeline had lent him half the purchase price. By that stage, therefore, each side seems, to have been conceding factual points which later became the basis of the other’s case at trial: (a) Madeline had more than once acknowledged that Dr Elithorn had a beneficial half share, the price of which had been (by inference) the assumption of a debt liability to her for half the purchase price, an acknowledgment rejected by the claimants at trial; and (b) Dr Elithorn was, by Miss Lebow, disclaiming that he had provided any part of the purchase price of Rose Hill, whereas his case at trial was that he had done just that – by borrowing from Madeline. At about the same time Dr Elithorn executed a declaration of trust acknowledging the £70,000 loan in 1995 in relation to Constantine Road and also that it was to be repaid on his death. But Madeline was not prepared to sign it, or to release the caution, until Rose Hill was transferred into her name.
40.	In February 2000 Dr Elithorn finally sold Constantine Road and repaid the £70,000 loan to Madeline (without interest), in exchange for which she withdrew the caution so as to enable the sale to complete. Negotiations in relation to Rose Hill continued as aimlessly as before. In her letter to Mr Young of 11 January 2001, Madeline referred to a recent meeting with Dr Elithorn in which he had proposed that she should transfer to him her half share. She did not deny that he had a half – or any – share in Rose Hill. On 13 February 2001 Mr Young repeated to Dr Elithorn the proposal that he should transfer Rose Hill into the sole name of Madeline, with a right thereafter to live there rent-free for life. If he declined that offer, Madeline would apply for an order for sale. That is the ordinary remedy where one of two beneficial owners wants to realise his interest.
41.	In April 2001 Edward Pilling & Co, solicitors, entered the scene for Dr Elithorn. Mr Pilling had a meeting with him and wrote to him on 17 April confirming his advice. It was as follows:
“You have told me that the property is worth approximately £350,000 and that the property was purchased by both you and [Madeline] in January 1996 as tenants in common.
As I explained there is a presumption that any property purchased by two people in joint names and particularly as tenants in common in equal shares is owned jointly and that means that the proceeds of sale are also owned jointly. The presumption goes on to suggest that if the money comes from one party alone or the majority of it comes from one party alone then there is still a presumption of gift which has to be refuted.
There is nothing you have told me which would, to my mind, negative the presumption of a gift. …”
42.	The importance of Mr Pilling’s letter lies not so much in what it said as in what it did not say: it did not suggest (any more than had Miss Lebow’s letters) that Dr Elithorn had told Mr Pilling that Madeline had lent him half the purchase price for Rose Hill in consequence of which he was entitled to assert a claim to a beneficial half share as a purchaser. If Mr Pilling had understood that to have been his client’s case, he would not have considered whether there was a presumption of gift. He could have advanced a rather more cogent case. 
43.	In June 2001 Mr Young instructed counsel with a view to the preparation of proceedings for an order for sale of Rose Hill. A letter of instruction to counsel of 13 June 2001 made no suggestion that Madeline had lent money to Dr Elithorn to enable him to contribute half the purchase price. On 18 July 2001 Madeline, however, wrote to Mr Young that:
“Since [Dr Elithorn] has rejected my generous offer of free accommodation for the rest of his life in return for a signed Declaration of Trust, my situation is now that I wish to sell the house. If the house remains in joint names at time of sale, as [Dr Elithorn] owes me 50 per cent of the value of the house, I would expect to realise the whole of the sale price.”
44.	I do not follow why Madeline regarded it as relevant to her claim whether or not Rose Hill might be in joint names at the time of the sale unless only she had in mind that a prior transfer into her sole name would either automatically extinguish, or would be accompanied by an express extinguishment of, Dr Elithorn’s beneficial interest. And on no footing did Dr Elithorn “owe [Madeline] 50 per cent of the value of the house, ….”, although she had previously recognised that he owed her half of the purchase price. I would regard the fair interpretation of this letter as simply amounting to a further, albeit inaccurately expressed, recognition of Dr Elithorn’s liability so to reimburse her. It was, therefore, consistent with Dr Elithorn’s case at the trial. I can now leave 2001, save for adding that during that year Madeline sold Island Reach and moved into a house she bought at Burghfield Common, Berkshire and occupied with Michael Smith, her partner.
45.	Months later, on 30 May 2002 – no proceedings having been issued in the meantime -- Mr Young wrote to Mr Pilling saying that Madeline was “adamant that it was not agreed at the time [of the purchase] that [Dr Elithorn] would have a 50% ownership of the property.” He repeated the threat of proceedings. The threat was further repeated in February 2003, but still no proceedings were issued. By May 2003 Madeline, who was by then very ill, had instructed Manches LLP in place of Mr Young’s firm, and Mr Poulter (a Manches partner, and a claimant) saw her in hospital on 22 May 2003, where she had been for four weeks. He made a full note of the meeting. He noted that she told him that the purchase of Rose Hill was “intended to be a joint purchase”, that she was advised to buy it with Dr Elithorn “as tenants in common”. His note continued:
“However, in the event [Constantine Road] had not been sold at the time when the purchase of [Rose Hill] was due to be completed and Madeline put up the whole of the purchase price. Elithorn never reimbursed her for her half share of the price and she recalls that this was £250,000.”
46.	That imprecise statement was perhaps consistent with both sides’ cases eventually presented to the judge, and does not lend much help to the resolution of the issue that was before him. Mr Poulter prepared a witness statement for Madeline, and she signed it on 27 May 2003. It described the arrangement for the purchase of Rose Hill as follows:
“2. Our joint intention was that, when the purchase of [Rose Hill] was completed, Dr Elithorn would provide a proportion of the purchase price from the proceeds of [Constantine Road]. For this reason, the transfer of [Rose Hill] was made in our favour as tenants in common in unspecified shares.
3. The purchase price of [Rose Hill] was £235,000 plus a further sum of £15,700 for furniture, fixtures and fittings ….
5. … I personally provided the whole of the purchase price of [Rose Hill] and the [fixtures and fittings] and paid all the costs associated with the purchase. At no time since the purchase has Dr Elithorn paid to me any sum whatsoever towards the price of [Rose Hill] or [the fixtures and fittings] or the costs of the purchase nor has he provided any other consideration in respect thereof.”
47.	It is not suggested that Madeline could have been working from any recollection of what the transfer had said, let alone from a sight of it, and so the second sentence of paragraph 2 was inaccurate. Her account does not deal specifically with the claim that she had lent Dr Elithorn half the purchase price, although it can be said to be implicitly inconsistent with it. Its sense was that she bought Rose Hill with her own money; and the plan was that he would, when he had sold Constantine Road, make an unspecified contribution to the purchase price and so acquire a proportionate share. That was consistent with her early explanations of the arrangement in the letters she wrote on 7 April and 20 May 1996. It was inconsistent with what she was writing to Mr Young and Dr Elithorn between 1998 and 2001. It is unfortunate that her statement made no reference to, or explanation of, Dr Elithorn’s March 1997 debt acknowledgment or her subsequent acknowledgments that Dr Elithorn was a debtor to her for half the purchase price of Rose Hill and had a half share in it. The latter acknowledgments were admissions against her interest.
48.	Madeline died on 29 May 2003, two days after making that statement. The claimants obtained probate of her will on 31 December 2003. They repeated Madeline’s offer of a lifetime’s occupation of the house, which Dr Elithorn refused. Dr Elithorn changed his solicitors again on 30 June 2004 but his new solicitors ceased acting for him in December 2004, since when he has represented himself, save only that counsel prepared his amended grounds of appeal to this court and a skeleton argument in support of them. The claimants issued the present proceedings against Dr Elithorn on 23 February 2006. 
49.	In the summary of the correspondence I have set out, I have not referred to any letters from Dr Elithorn setting out his account of the arrangement for the purchase of Rose Hill was. He wrote a number of somewhat rambling letters but so far as I can see none asserts that Madeline lent him half the purchase price at the outset and that he assumed the obligation of a debtor to repay her. Nor did he explain how his March 1997 acknowledgment fitted into the story. The inference is also that he never instructed his various solicitors that he was a debtor of Madeline. Mr Pilling’s summary of his position in his letter to Manches of 13 November 2003 – a time in the chronology by when one might expect Dr Elithorn to know what his case was -- was as follows:
“We have reviewed the paperwork and there is no evidence that [Madeline] did not intend to give Dr Elithorn one half of the property. Indeed there is very compelling evidence, namely the letter to Cole & Cole from Willmett & Co which suggests that the matter had been considered and had been deliberately left so that the property was held on a 50/50 basis.”
Whatever (if any) merit there may have been in that argument, it does not make the case that Madeline lent Dr Elithorn half the purchase price so that he can and should be regarded as a purchaser of a half share in Rose Hill. 
50.	That case was only raised later. So far as I can see it was first raised in Dr Elithorn’s home made defence to the claim which, so far as material, read:
“[Dr Elithorn] is the legal owner of at least one half [Rose Hill]. [He] bought his share … as part of a loan agreement with [Madeline]. The fact that his loan was interest free from the beginning made good business sense for both as it freed [him] from outgoings that [he] could not afford. … [Madeline] paid for my capital investment in the project out of an agreed shared capital and that she agreed that this need only be returned on my death.”
51.	I interpret that as referring to the arrangement he says was made at the time of the purchase of Rose Hill, which I understand to have been his case at trial.  
Witness statements
52.	The nature of the factual issues at the trial was such that there was limited scope for relevant evidence from anyone other than Madeline and Dr Elithorn. Barbara Kershaw, Madeline’s sister, made a statement that appears to me to have been of no value. It made references to Madeline having referred to Rose Hill as “her” house, and apparently hers alone, whereas Madeline herself wrote otherwise. Mr Poulter’s witness statement was a worthy contribution from someone with no knowledge of anything relevant to the main issue. Various witnesses also made irrelevant statements in support of Dr Elithorn’s case: Mr Stanley, Mr Herklots, Mr Doult, Ms Bristow and Ms Reynolds.
53.	Dr Elithorn made several witness statements which, like his contributions at the trial and most of his oral address to us, failed to focus with precision on the financial arrangements for the purchase of Rose Hill. In one statement, dated 6 September 2006, all he said about the purchase of Rose Hill was that “we bought [it] together, sharing her office and her bedroom and I was allocated one spare room as my store room.” In another, dated 28 September 2006, he did not deal with the basis upon which Rose Hill was bought beyond advancing the assertion that “Where there is a tenancy in common there is a natural presumption that the property is shared equally between the parties unless there is evidence to the contrary.” Neither statement asserted that he had borrowed half the purchase price for Rose Hill from Madeline. But in what appears to be his final statement for the trial (also dated 28 September 2006) he did get round to making this case, albeit again only in vague terms. He there said:
“It is admitted by [Dr Elithorn] that that [sic] at all times he has regarded the monies advanced to be a loan and due to be secured against his beneficial rights in any property in which they might be invested.
The bottom line of [his] position is that he owns at least half the beneficial rights of [Rose Hill] and that his only indebtedness to the estate is the monies loaned and up to 5% of his earnings. …
It seems more inalienable that I had reached a binding agreement that could only be altered by agreement with Madeline that with her agreement and in the event of my virtual imprisonment in London by my Fundamentalist lodger that I would continue to use the whole of the loan that I had been given to develop the practice and the business that we had agreed. In the event I was force [sic] through the failure of trust rather than need to return the portion of the loan which represented the Mortgage repayment for [Constantine Road].”
The trial
54.	Because of the imprecise way in which Dr Elithorn’s Defence and witness statements presented his case that he became a debtor to Madeline on completion of the purchase of Rose Hill, I will summarise what he said about that case during the trial itself. The trial followed a slightly unusual course. Miss Hutton’s opening was one in which it soon became apparent that Dr Elithorn was going to take every opportunity to make oral contributions of his own; and in order that they could be regarded as part of his evidence, he made an affirmation at an early stage. During the opening, Dr Elithorn indicated that he was asserting that Madeline lent him his contribution to the purchase price (transcript Day 1, page 13, line 1; page 15, line 18; page 35, line 8; page 107, line 25 to page 108, line 5). Miss Hutton, for her part, when referring to one of the letters in which Madeline acknowledged that Dr Elithorn was indebted to her for half the purchase price, indicated that what was unclear was “whether it was an agreement for a loan right at the outset” (Day 1, page 30, line 10). That was a fair point.
55.	Dr Elithorn commenced formally giving his evidence on the afternoon of Day 2 and gave supplemental oral evidence in chief in the course of an exchange with the judge. He repeated that the arrangement was that Madeline was to provide the money to buy Rose Hill and he said that at a later date he was to refund his half share, adding that “Later, when [Madeline] realised that I had difficulties in getting rid of lodgers, she agreed that the money could be lent as to me as a loan, repayable without interest on my death, or earlier.” That was probably a reference to what led up to the March 1997 debt acknowledgment and may be said to support the view that that acknowledgment represented a change in the nature of the arrangement: taken literally, Dr Elithorn’s quoted words can be read as suggesting there was no debt relationship before then. That interpretation is, however, one that I consider to be at variance with his evidence taken as a whole. Indeed on the same page of the transcript he went on to say, in effect, that half the purchase price was a loan to him from the outset (Day 2, page 3 of his evidence, line 13 down to page 5, line 4). He affirmed the making of such a loan in cross-examination (Day 2, page 31 of his evidence, lines 13 to 20). 
56.	At Day 2, page 41, lines 21 to 24 of his cross-examination, Dr Elithorn positively denied that the arrangement with Madeline was as the claimants asserted it to be, a denial he repeated at page 42, line 25. Having made that denial, he added an explanation of which the first part again appeared to suggest he might not have been a debtor of Madeline from the outset but only became such upon signing the March 1997 acknowledgment. There was this exchange with Miss Hutton:
“A. … The agreement between me and Madeline, until she came to want to reconsider it, was that we were going to share it [Rose Hill] equally and that I would contribute my share of the cost price and that, because I couldn’t do that, she agreed to lend me the money appropriately, provided I paid it back by the time I was dead.
Q. That agreement was not made, if it was ever made, in November/December 1995, Dr Elithorn, was it?
A. That agreement was made right from the beginning when she – we discussed the fact that she didn’t actually feel that she owed (sic) this money and it was that blood money.”
Later (Day 3, page 56, lines 5 to 10) there was this exchange:
“Q. Therefore are you saying that when Rose Hill was purchased, you never made any agreement to make any contribution to the cost?
A. I agreed at all times, with [Madeline], that I would pay back the total loan not later than my death – not later and not necessarily earlier than my death. That was an absolute basic agreement between us, from which I never faltered and [Madeline] did ask me to pay earlier at times according to the mood and who she was consulting as a solicitor. But I don’t think she ever asked me personally. In fact the last time she discussed it was at Browns, when she was perfectly happy with the agreement.”
57.	At Day 3, page 58, lines 21 to 26, Miss Hutton put, for the third time, the claimants’ case to Dr Elithorn, and for the third time he denied it. At page 68 he re-affirmed that he had been lent a lot of money, and that he “had agreed to pay the loan back in its entirety by the time of my death and that I was willing to try to pay some of it back earlier, and I did in fact pay back the £70,000 ….” When referred to the March 1997 acknowledgment, he replied “I’m just admitting the debt, aren’t I? What’s wrong with that?” (Day 3, page 85, lines 12 to 21).
58.	Dr Elithorn’s closing submissions to the judge cannot be said to have homed in on his case that he was a true joint purchaser of Rose Hill; and he at no stage appears to have made the short, simple submission that was open to him. That really was his only point. The judge, however, appears to have recognised in the course of the argument – at least provisionally – that there had been the loan arrangement that Dr Elithorn was asserting. But he put to Dr Elithorn that he was only to get a share in Rose Hill when he repaid the loan (Day 4, page 59, lines 10 to 16). Miss Hutton, in her closing submissions, disputed that there was any basis for a finding that there was a loan arrangement from the outset of the purchase (Day 4, page 69, line 10ff).
The judge’s judgment
59.	The trial occupied from Monday 2 October to Thursday 5 October 2006, when it was adjourned to Monday 9 October for Dr Elithorn to make a reply to Miss Hutton’s submissions, following which the judge delivered an oral judgment which occupied him for the rest of the day. It is a long judgment, of which the transcript runs to some 44 single-spaced pages, mostly consisting of extensive quotations. The judge probably worked from an outline road map giving him pointers as to the route he wanted to follow. Whilst the judgment has the considerable merit of having been an ex tempore one – which was no doubt welcome to the parties – it does, with respect, suffer from a lack of analysis of the material relevant to the issues he had to decide. It is that shortcoming that has made this appeal one that I have found to be difficult.
60.	The judge opened by reading the prayer to the Particulars of Claim and Dr Elithorn’s Defence. He then referred, in some detail, to what Dr Elithorn had said at the beginning of his oral evidence by way of supplemental evidence in chief in addition to, or explanation of, what he had said in his Defence and witness statements. After recording that Dr Elithorn agreed that the proposal was that he would “refund his share” out of the proceeds of Constantine Road, the judge noted his evidence as being that:
“Later, when she realised I had difficulties in getting rid of lodgers she agreed that the money could best be lent to me as a loan repayable without interest on my death or earlier.”
61.	Dr Elithorn’s suggestion here that it was difficulties with lodgers that was the reason why Constantine Road was not sold promptly was, I consider, misplaced (the relevant lodger did not arrive on the scene until October 1996). But the agreement referred to can only have been that which resulted in March 1997 document.  
62.	After observing that the case raised “in acute form questions of resulting trust and possible constructive trusts”, the judge then devoted some ten pages to a reference to the law, citing extensively from Snell’s Equity, 31st Edition, and various well-known authorities. He then read the Particulars of Claim, interposing into their recitation the reading of various letters they referred to. One was the letter of 13 August 1999 to which I have referred (misdescribed by the judge as dated 21 August), being a letter in which Madeline recognised that Dr Elithorn had a share in Rose Hill and owed her £125,000. 
63.	At paragraph 28 the judge made an error of fact, wrongly referring to the £70,000 loan as being made after the purchase of Rose Hill and saying that:
“… it was intended that the loan would enable the mortgage [on Constantine Road] to be cleared and thus make it easier for [Dr Elithorn] to sell [Constantine Road] and thus to meet his half of the proposed contribution to the purchase price.”
That was not an accurate description of the purpose of the £70,000 loan, which was to keep Abbey National at bay.  
64.	The judge then turned to the witness statements, and read extensively from Dr Elithorn’s. Whilst those statements do not make his loan case as clear as they might have done, there is no doubt that the judge understood that that was his case; and the judge’s comment interposed between his reading of paragraphs 3 and 4 of what he called Dr Elithorn’s fourth statement shows that he understood that Dr Elithorn was saying he had a loan for the purchase of Rose Hill. He had earlier made that clear during Dr Elithorn’s closing submissions.
65.	The judge then turned to the claimants’ witness statements. He prefaced his reading of Madeline’s statement of 27 May 2003 with this observation:
“… So far as [Madeline] is concerned, [Dr Elithorn] has a good point that I have not had the opportunity to hear from [Madeline] herself. I have to read her witness statement in that light. However, I am bound to say that in the context of the very large bundle of disclosed documents and [sic] many of which I have not referred as yet and to most of which I shall not refer, what is said in that statement is consistent with what is found there. …”
66.	That is an unsatisfactory assessment. The judge did not say what it was in the statement that he regarded as consistent with the documents. If, however, he was deriving from the statement an implied denial that Madeline had made a loan to Dr Elithorn – something she did not deny expressly – the judge’s assessment was manifestly wrong. Madeline had indeed made early statements in her letters of 7 April and 20 May 1996 pointing away from the making of a loan; but she also made later acknowledgments between 1998 and 2001 that she had made a loan to Dr Elithorn and that he had a half share in Rose Hill, and her statement offered no explanation of those later acknowledgments. The judge in fact made no reference to the letters of 7 April and 20 May 1996. He did refer to the letters of 18 October 1998 and 13 August 1999, but engaged in no discussion of the inconsistency between what Madeline had said in them and the claimants’ pleaded case. He engaged in no consideration of the impact of Dr Elithorn’s debt acknowledgment of 24 March 1997, nor did he refer to any of the letters of 8 February and 18 September 1998, 2 June, 27 June and 6 October 1999, and 11 January and 18 July 2001 in all of which Madeline’s expressed position was directly at variance with the claimants’ case. 
67.	The judge then read Madeline’s witness statement, noting that Dr Elithorn agreed with her that their joint intention at the time of the purchase was that he “would provide a portion of the purchase money from the proceeds of sale from [Constantine Road].” He also recorded that in cross-examination Dr Elithorn agreed with what Madeline had said in paragraph 5 of that statement, namely that “At no time since the purchase has [he] paid to me any sum whatsoever towards the price of the property or the furniture, nor has he provided any other consideration in respect thereof.” The judge accepted that the facts asserted in Madeline’s statement were true; and said that, where Dr Elithorn’s evidence differed, he did not accept that evidence. If (which he nowhere said) the judge was implicitly interpreting Madeline’s statement as denying that she had made the loan that Dr Elithorn had asserted, then that unreasoned finding could perhaps be read as including a finding that there was no such loan. Given, however, (a) the lack of explanation sufficient to justify that conclusion, and (b) the unambiguous way in which the judge was later to deal with the loan allegation in paragraphs 71 and 72 of his judgment, I am unable to conclude that the judge was here rejecting the loan allegation. 
68.	The judge then read from Mr Poulter’s statement, referring in doing so to the letter that Madeline had written to Mr Young on 18 October 1998, one in which she had told Mr Young that she was “prepared to wait to recover the loans until [Dr Elithorn] dies.” The judge said that, were Madeline alive, the letter could have been put to her in cross-examination; and that Dr Elithorn confirmed in his own cross-examination that she had always told him this. The judge then read from Barbara Kershaw’s statement.
69.	The judge then expressed his conclusions as follows:
“71.	In my judgment the oral evidence which I have heard from the Claimants is all of one piece. Similarly the documentary evidence, to some of which I have referred. The conclusions I form on the oral and documentary evidence are as follows. So far as the arrangements for the purchase of the property are concerned I am satisfied that an arrangement was made that [Madeline] and [Dr Elithorn] would buy the property with the object of it being perhaps a home for both of them, but certainly a home for the use of [Dr Elithorn]. The arrangement was that [Madeline] would provide all the money for the purchase, that the property would be put in joint names because [Madeline] understood that [Dr Elithorn] was shortly to sell the London property and from the proceeds of sale he would be able to pay her back. She did not know at that stage the extent of his finances or the mortgage on the London property.
72.	I am satisfied that there was a conditional agreement to that effect, but in the course of time that no monies were ever paid at all by [Dr Elithorn] to [Madeline]. Prima facie, therefore, the property was held on a resulting trust, the primary claim made by the estate in this claim. If I am wrong on that, so far as there being constructive trust is concerned, it seems to me that that, in my judgment, looking at the judgment in Lloyds Bank v. Rossett and the passages from Lord Bridge to which I have referred, any terms of the constructive trust were that when the London property was sold [Madeline’s] monies advanced for the purchase on behalf of [Dr Elithorn] were to be repaid. That, in fact, never happened. In fact [Madeline] made further loans to him which were eventually repaid without interest, but the conditional agreement was never met by [Dr Elithorn] at all and has not been met now.” 
Discussion and conclusion
70.	Those conclusions resulted in the making of the declaration adverse to Dr Elithorn described in paragraph [1] of this judgment. I comment, first, in relation to judge’s the opening remarks in paragraph 71, that the claimants’ oral evidence was irrelevant to the central issue of loan or no loan; and the documentary evidence, whilst relevant, was not “all of one piece”. If the judge had considered it, he could not have failed to have realised that. 
71.	The essence of the judge’s conclusion was (i) that Madeline provided the whole of the purchase price for Rose Hill under an arrangement by which Dr Elithorn was to “pay her back” from the proceeds of Constantine Road; but as he never did pay her back, he did not acquire any beneficial interest in Rose Hill, and so, although it was bought in joint names, it was held on a resulting trust for her; alternatively, (ii) that in so far as Dr Elithorn was asserting a beneficial entitlement under a constructive trust, his entitlement was dependent on the repayment to Madeline out of the proceeds of Constantine Road to Madeline of an amount equal to an unspecified part of the purchase price for Rose Hill that she had advanced to him at the time of the purchase; and as he did not repay her, there was no basis upon which he could assert a constructive trust giving him a beneficial share.
72.	It might perhaps be possible to interpret the judge’s alternative conclusions as reflecting alternative assumptions as to the facts. It may perhaps be said (although I do not think that Miss Hutton did say it) that his first head of reasoning proceeded on the basis of an implied primary finding that, contrary to Dr Elithorn’s case, there was no loan arrangement at the time of the purchase of Rose Hill so that it followed that, as Madeline had put up the whole of the purchase price and Dr Elithorn never contributed towards it, she acquired and retained the whole beneficial interest under a resulting trust. By contrast, it may be said that his alternative head of reasoning proceeded on the basis that there was such a loan arrangement. The judge’s language in explaining that alternative reasoning leaves no scope for doubt that it was based on the premise that Madeline had lent Dr Elithorn part of the purchase price for Rose Hill. What he said included that:
 “… [Madeline’s] monies advanced for the purchase on behalf of [Dr Elithorn] were to be repaid. In fact that never happened. In fact [Madeline] made further loans to him which were eventually repaid without interest. …” (emphasis supplied)
The judge was in fact doubly wrong in saying that Madeline made further loans to Dr Elithorn. First, Madeline only made one other loan to Dr Elithorn. Secondly, that loan was made in August 1995, which preceded the purchase of Rose Hill. The judge had earlier misdescribed it as post-dating the purchase, and here he did so again: there is no dispute that it is this loan to which the judge was here inaccurately referring. The significance of what the judge said about it lies, however, in his “further”, which underlines his acceptance that Madeline made Dr Elithorn a loan to enable him to contribute to the purchase of Rose Hill. 
73.	I do not, however, consider that in those two paragraphs the judge was proceeding on alternative factual bases. The distinction that he appears to have had in mind in advancing his alternative reasoning was that the first alternative dealt with a resulting trust case and the second with a constructive trust case. I am not sure that that distinction was a helpful one. But I am unconvinced that the judge was impliedly dealing with each alternative on different factual bases. If he was intending to make a primary finding that, contrary to Dr Elithorn’s case, there was no loan arrangement, he would surely have said so expressly, which he nowhere did. Nor, if that was his finding, would he in paragraph 71 have referred to the arrangement as one under which Dr Elithorn was to “to pay her back”. You do not pay back that which you have not borrowed; and the judge would not have used careless language of that sort if, in his first alternative, he had intended to record an implied finding that no loan had been made. The judge’s “If I am wrong on that” in paragraph 72 was not, in my view, directed at the possibility of error on his part in an implied finding that there was no loan arrangement. It was directed rather at the possibility that his legal conclusion based on resulting trust was wrong. In my judgment the sense of paragraphs 71 and 72 as a whole is that the judge was finding that Madeline did make the loan to Dr Elithorn that the latter was asserting. It seems to me obvious that if the judge’s two alternative grounds were dependent on different assumptions as to the facts – i.e. loan arrangement or no loan arrangement – he would have spelt the position out in terms, explained what his primary finding was and given brief reasons for it. 
74.	Miss Hutton urged us not to interpret the judge as here making a finding that Madeline had made the loan that Dr Elithorn. She submitted that the key to the case lay in Madeline’s near contemporaneous explanations of the arrangement in her letters of 7 April and 20 May 1996 – which pointed against any loan arrangement. She said that in the subsequent letters in which Madeline might be said to have acknowledged a loan she was merely using loose language that should not be regarded as inconsistent with her initial explanation. She submitted that the judge’s language should not be construed in accordance with what appears to be its natural meaning. She submitted that certain of Dr Elithorn’s own explanations (and I have referred to them) were to the effect that the notion of a loan only arose at the time of the March 1997 acknowledgment and were inconsistent with there having been a loan at the outset. She submitted that the loan in discussion by March 1997 never became an actual loan.
75.	I consider that there was much force in Miss Hutton’s submission that the key to the resolution of the factual issue between the parties lay in Madeline’s explanations of the arrangement that she made in her letters of 7 April and 20 May 1996. They were made within six months of the transaction, and point away from the making of a loan at the outset. There was also force in the point that the discussion of a loan only arose in 1997, when it was apparent that Constantine Road had not been sold, and was not going to be sold promptly; and Miss Hutton was entitled to say that Dr Elithorn’s own choice of language supported that position, although on other occasions he had also made it clear that it was a loan arrangement from the outset (as, I might add, he firmly repeated to us). I consider, however, that there was rather less force in Miss Hutton’s submission that Madeline’s various loan references between 1998 and 2001 were nothing more than a loose use of language. There is, it seems to me, no getting away from the fact that there came a time when Madeline was acknowledging that Dr Elithorn had a half share in Rose Hill and owed her half the purchase price. 
76.	The difficulty, however, that I have with Miss Hutton’s submissions is that we are not the judges of fact. The fact-finding exercise was one that the judge had to perform and he performed it in paragraphs 71 and 72 of his judgment. I consider that the judge was there making it plain that he was finding that Madeline did lend Dr Elithorn half the purchase price at the outset. There is no cross-appeal against that finding and I do not follow on what basis this court can treat the judge as having made a different finding. 
77.	As, so I conclude, the judge found that Madeline did make a loan to Dr Elithorn of an unspecified part of the purchase price, I regard his overall conclusion as insupportable. Once he had made that finding, his conclusion that Dr Elithorn acquired no beneficial interest appears to me to be wrong. Dr Elithorn was, on that basis, a true purchaser of Rose Hill who provided half the purchase price and who was registered as a joint proprietor. Whilst the restriction on the register points against a beneficial joint tenancy, the ordinary presumption would be that he acquired, and has, a beneficial half share. That presumption might be rebuttable if, for example, it could be shown that Madeline had put up more of the purchase price than he had. But there is no scope for such a finding: all the evidence – including Madeline’s various admissions – supports the conclusion that he did provide half. Once, therefore, the judge had found that he was a purchaser of Rose Hill, I can see no alternative to a consequential finding that he acquired upon completion a beneficial half share in it. Instead, however, the judge found that he had and has no beneficial interest – but, by inference, remains indebted to Madeline’s estate for half the purchase price. If, pending the discharge of that debt, the estate disposes of Rose Hill, what will Dr Elithorn receive in exchange for his £125,000 when eventually it is paid?
78.	In arriving at the conclusion that he did, the judge’s error was to elide both sides’ cases. The reason why it seems to me that the judge’s decision cannot stand is that it was wholly inconsistent with the case the claimants were making. The loan case was Dr Elithorn’s, not the claimants’. Their case was not that there was a loan. It was that Madeline not only provided all the cash required for the purchase, she was the sole purchaser. She intended Dr Elithorn to acquire an interest in it, but only if and when – following the sale of Constantine Road -- he made a contribution to the cost of purchase that she had alone incurred. That contribution was not, however, to be by way of the repayment of a loan because there had been none. It was, in effect, Dr Elithorn’s chance to buy from her a beneficial share in Rose Hill, a share which she and he intended would be up to a half share. If the judge had made a finding that the claimants’ case was correct on the facts, they would have been entitled to succeed.
79.	Once, however, the judge found that Dr Elithorn was a purchaser from the outset, there was no scope for his conclusion that he never acquired an interest at all. That conclusion involved the implied attribution to Madeline and Dr Elithorn of an absurd arrangement that, not surprisingly, formed no part of the claimants’ case. That arrangement would have to have been either: (i) although Dr Elithorn was providing half the purchase price, he was to acquire no beneficial interest unless and until he actually repaid the debt; and until then Madeline was the sole beneficial owner, and could dispose of Rose Hill for her own sole benefit, leaving Dr Elithorn still liable to her in debt for half the purchase price; or alternatively (ii) whilst Dr Elithorn acquired an immediate beneficial interest on purchase, his retention of it was to be dependent on a condition subsequent that he discharged his debt to Madeline within a reasonable time, in default of which his interest would lapse and his debt would be impliedly discharged. Nothing of either sort formed any part of the claimants’ case.
80.	I have to say that I find the judge’s conclusion that Madeline made a loan to Dr Elithorn a surprising one. I do not mean that it was not open to him on the evidence. I have referred to the evidence fairly fully; and whilst it certainly did not point only in the loan direction, there was material justifying the finding that the judge made. My expression of surprise reflects that nothing in the 70 paragraphs leading up to the judge’s conclusion prepares the innocent reader for the shock of his conclusion. He did not precede it by a discussion of the key issue between the parties, including a comprehensive reference to the material pointing towards and away from the finding that he made. He did not discuss the March 1997 document and ask himself whether it truly reflected a debt that had existed from the outset. His ultimate finding that there was a loan from the outset can be said to have been essentially unreasoned and – save for his exchange with Dr Elithorn during the latter’s closing submissions, to which I have referred -- unheralded. Nevertheless, I regard it as one that he was entitled to make on the evidence. In my judgment, it should have meant the end of the claimants’ case. In finding instead in favour of the claimants, the judge fell into error.
81.	I would allow the appeal and set aside the judge’s order dated 13 October 2006. If my Lords agree, I would wish to hear the parties as to the form of the order we should make. The need for that arises because of the alternative claim for relief that the claimants sought in paragraph 5 of the Particulars of Claim, a paragraph with which the judge did not have to concern himself.
Lord Justice Wilson :
82.	I agree that the appeal should be allowed for the reasons given by Rimer L.J.
83.	The judge would be the first to accept, in retrospect, that the format of his judgment was most unfortunate. His delivery of it lasted for most of one day. It took the form of his reading out, first, two lengthy documents compendiously treated as Dr Elithorn’s defence; then seven pages of Snell’s Equity, 31st ed.; then substantial quotations from two of the leading authorities on constructive trusts; then the particulars of claim; then four witness statements made by Dr Elithorn, which were largely irrelevant; then Madeline’s statement made two days prior to her death; then Mr Poulter’s statement, which was of no direct relevance; and then the statement of Madeline’s sister, which was irrelevant. In the course of this protracted exercise the judge made separate detours to seven letters, which he read out in full otherwise than in chronological order and of which five were in my view irrelevant; and he made certain other interpolations. Thereupon, in [71] and [72] of his judgment, which both my colleagues have quoted, the judge set out his conclusions. He had undertaken no chronological survey of the history such as Rimer L.J. has considered it necessary to undertake.
84.	Had the judge not in the event made what I regard as adequately clear findings which foreclose the issue in his favour, Dr Elithorn would – in my view – have had unanswerable grounds for asking this court to direct a retrial. Absent the adequately clear findings which ultimately emerged in the judgment, Dr Elithorn could have said with force that the judge had never properly addressed his case nor surveyed the evidence which best supported it. 
85.	One of the judge’s interpolations, between readings, was as follows:
“33. [Dr Elithorn’s] case is, as it appears, that there was some sort of an agreement between him and the deceased as to sharing the property. It is necessary for him to produce evidence to establish that.”
Although his presentations to the judge, written and oral, were thoroughly discursive and although over the years he had made significantly inconsistent assertions, Dr Elithorn’s case, by the date of the hearing, was far clearer than the judge’s summary suggested: it was that, from the date of the purchase, he and Madeline had been joint and equal owners of the property in equity as well as jointly in law and that he had been subject to a contractual obligation to repay her £125,000 lent to him in order to enable him to purchase his share, the date of repayment having been subsequently extended by agreement to be no later than the date of his death. Such was the case which, in order to do justice to it, the judge should have ascribed to Dr Elithorn. Thereafter, at some point, the judge should have at any rate expressly considered the documentary evidence which most strongly favoured Dr Elithorn’s version of the arrangement (as well, of course, as that which most strongly favoured the executors’ version). But the judge referred only to one of the five documents which in my view most strongly indicate that the arrangement was indeed always one of equal beneficial ownership and loan. Such five documents are Mr Foster’s note of the meeting on 4 April 1996, Dr Elithorn’s handwritten acknowledgement of debt signed on 24 March 1997, Madeline’s enclosure of it with her letter to Mr Young dated 8 February 1998, her letter to Mr Young dated 18 September 1998 and her letter to Dr Elithorn dated 13 August 1999 (this last being one of the seven letters which the judge read out in full, albeit without comment on it).
86.	Those five documents should have attracted the judge’s express analysis, as also should the documents most strongly indicative of the accuracy of the executors’ version of the arrangement, in particular Madeline’s letter to Mr Young dated 20 May 1996, to which, again, the judge did not refer. In analysing them the judge should indeed have borne in mind that the letter dated 20 May 1996 came into existence nearer the date of purchase than most of the documents indicative of Dr Elithorn’s version; but the fact that most of the latter came into existence further from that date does not – in my view – indicate that they were purporting to describe the arrangement as it stood otherwise than as at that date, save in relation to the time for repayment of the alleged loan.
87.	Notwithstanding the conflicting conclusions to which the different documents pointed, the judge saw fit to comment that the statement made by Madeline two days prior to her death was “consistent” with “the very large bundle of disclosed documents”; and indeed that the documentary evidence was “all of one piece”. The mass of other, irrelevant, documents and the rambling nature of Dr Elithorn’s presentation had uncharacteristically distracted the judge from identifying not only the nature of his case but also the evidence which supported it.
88.	Absent the adequately clear findings which ultimately emerged, the judge’s reference to the burden of proof in the paragraph which I have quoted would have been another factor demanding retrial. Miss Hutton, whose conduct of the executors’ case in awkward circumstances there is no reason to criticise, had persuaded the judge that, as he had stated in an earlier paragraph, Madeline’s provision of the entire purchase money raised a presumption of a resulting trust for her sole benefit and that the onus lay on Dr Elithorn to rebut it. Whether, even prior to the decision of the House of Lords in Stack v. Dowden [2007] UKHL 17, [2007] 2 AC 432, such was a valid statement of the law in circumstances in which the legal interest in the property had been vested in both of them jointly is a question which can remain unanswered. But, as Miss Hutton has accepted, that decision, made six months after the judge’s judgment, clearly shows, at any rate now, that the judge’s statement is invalid. In the words of Baroness Hale, at [68]:
“The burden will therefore be on the person seeking to show that the parties did intend their beneficial interests to be different from their legal interests, and in what way.”
89.	In this respect Miss Hutton’s submissions to us have had to be exceedingly bold. She has explained to us that her preferred legal analysis of the arrangement alleged by the executors to have been reached between Madeline and Dr Elithorn is that, from the date of purchase, they each had an equal beneficial interest in the property, subject only to the impression upon Dr Elithorn’s half share of a subtrust in favour of Madeline which was fully defeasible in the event that he paid her £125,000 and pro tanto defeasible in the event that he paid her less than that. The judge (Miss Hutton has submitted) has made his ultimate findings in favour of the contentions of the executors so clear – and they are so impregnable in this court – that we should be confident that, even had he recognised that it was for them to discharge the burden of proof, he would necessarily – and legitimately – have held that they had discharged it.
90.	It is here that, with respect, Miss Hutton and I part company. I agree with her that the judge’s findings are, albeit not entirely clear, adequately clear: but in my view they are findings opposite to those perceived by Miss Hutton. I entirely agree that, taken alone, the judge’s finding in [71] of his judgment that Madeline understood that Dr Elithorn would “pay her back” out of the proceeds of Constantine Road would not carry his case far: for the notion of his “payment back” to her fits nearly as well with his payment to her of a sum by way of investment in a property for which she had previously paid as with his repayment to her of a loan. But, next to that finding, we must place, first, his key finding in [72] that “any terms of the constructive trust were that when the London property was sold the deceased’s monies advanced for the purchase on behalf of [Dr Elithorn] were to be repaid” and, second, his key reference in the same paragraph to “further loans”. As to the first, I for my part attach no significance to the judge’s reference to “any” terms: in my view the adjective was intended to reflect only that he was articulating his factual finding within the context of his alternative legal analysis that the trust was constructive rather than resulting. As to the second, I regard the importance of the judge’s reference to “loans” as in no way diminished by his misunderstanding that the other, admitted, loan, was “further” rather than “prior”. The judge’s unparticularised reference in the same paragraph to a “conditional” agreement has given me greater pause for thought; but, when, later in the paragraph, I turn to what I construe to be his key, and more particularised conclusions about the terms of the agreement, set out above, I conclude that they are dispositive of the case in favour of Dr Elithorn.
91.	In associating myself with the observation of Rimer L.J. in [80] above that the judge’s finding of a loan was “surprising”, I do so strictly in the context which Rimer L.J. there proceeded to explain. The surprise relates not to the finding itself: there was a significant amount of evidence in support of it, including the bare fact of the placement of the property into joint names ab initio rather than into Madeline’s name until such time as Dr Elithorn were to make payment in respect thereof. The surprise relates only to the fact that, in upholding the claim of the executors, the judge presumably considered that his key conclusions entitled him to do so. In my view, faced with that unhappy situation, the court should not place a forced construction upon his key conclusions in order to make them consonant with his order upon the claim but, rather, should adopt his key conclusions, provided that (as is the case) they are sufficiently founded upon evidence before him, and should so adjust his order as to be consonant with them.
Lord Justice Rix :
92.	I regret to find myself differing from the conclusion of Lord Justice Rimer that this appeal should be allowed. However, as will appear, this results from a narrow disagreement as to the way in which to interpret the judgment of His Honour Judge Levy QC in the court below. In all other respects (and certainly up to paragraph 58 above) I gratefully adopt and respectfully agree with just about everything in Lord Justice Rimer’s judgment, which so helpfully sets out the long history of this dispute with clarity and insight. 
93.	As appears from that judgment, it is only or at any rate essentially his assessment and understanding of the judge’s critical paragraphs 71/72 (set out at para 69 above) that require in his view the conclusion that, by reason of the judge’s finding of a loan by Madeline to Dr Elithorn at the outset, the judge was bound to have found in Dr Elithorn’s favour and that his decision otherwise was in error. But for that (interpreted) finding of fact, Lord Justice Rimer would, as I understand his judgment, have accepted the respondents’ case, as being one that the judge himself had accepted, to the effect that, at the critical time of purchase, Dr Elithorn had no beneficial interest in the property. It is true that at a later time, Madeline came apparently to acknowledge that Dr Elithorn had a half share in Rose Hill and thus owed to her half the purchase price (see para 75 above), but Lord Justice Rimer has explained the circumstances in which she came to feel that she had no option but to recognise an obligation by Dr Elithorn to contribute to the cost of the house which he had effectively appropriated to himself. 
94.	Thus no question of law arises in this case, beyond the correct interpretation of the judge’s judgment together with his findings there made. It is only Lord Justice Rimer’s interpretation of that which has led him to his conclusion in favour of this appeal, which otherwise he would have dismissed.
95.	The narrow question therefore is whether the judge has made a finding that Madeline made a loan to Dr Elithorn at the time of purchase of Rose Hill to support his acquisition at that time of a beneficial interest in a half share of that property. Lord Justice Rimer in concluding, however firmly, that that was indeed the judge’s finding appears to do so with some surprise and regret for he says, for instance, that the judge’s conclusion that Madeline made a loan to Dr Elithorn was “a surprising one”; and that “nothing in the 70 paragraphs leading up to the judge’s conclusion prepares the innocent reader for the shock of his conclusion”; and that “His ultimate finding that there was a loan from the outset can be said to have been essentially unreasoned…and unheralded” (at para 80 above).  
96.	I agree with Lord Justice Rimer that if the judge’s judgment, properly interpreted, amounts to a positive finding that Madeline made a loan to Dr Elithorn from the outset of £125,000 to enable him to buy a half-share in the beneficial interest of Rose Hill, then we should not disturb it and his conclusion in favour of the respondents is wrong. The issue is whether such a surprising finding is actually to be discovered in his judgment. 
97.	I do not think it is. On the contrary, in my judgment what the judge was saying was that the whole arrangement with Dr Elithorn was conditional. If Dr Elithorn paid a sum to Madeline to support the purchase by him of up to a half share interest in the property, then he might obtain such an interest. If, however, he did not, then he obtained nothing. If he paid a lesser sum than half, then he could obtain a lesser interest accordingly. Nothing was said about timing, but it was contemplated that Dr Elithorn’s funds would come from the sale of his London home in Constantine Road. It was probably to be implied that a reasonable time would be open to effect that sale and provide funds out of it. As it is, Dr Elithorn chose not to sell his London home at that time and in any event he has never paid anything towards an interest in Rose Hill. Therefore, he has no interest in Rose Hill, although he might have acquired one.
98.	That was what the respondents were submitting at trial (and to this court on appeal, by reference to the judge’s judgment as well as on the underlying facts) and it was that case which the judge was, to my mind, accepting in paragraph 71 and the first half of paragraph 72 of his judgment. I set out his words below:
“71. In my judgment the oral evidence which I have heard from the Claimants is all of one piece. Similarly the documentary evidence, to some of which I have referred. The conclusions which I form on the oral and documentary evidence are as follows. So far as the arrangements for the purchase of the property are concerned I am satisfied that an arrangement was made that the deceased and the Defendant would buy the property with the object of it being perhaps a home for both of them, but certainly a home for the use of the Defendant. The arrangement was that the deceased would provide all the money for the purchase, that the property would be put in joint names because the deceased understood that the Defendant was shortly to sell the London property and from the proceeds of sale he would be able to pay her back. She did not know at that stage the extent of his finances or the mortgage on the London property.

72. I am satisfied that there was a conditional agreement to that effect, but in the course of time that no monies were ever paid at all by the Defendant to the deceased. Prima facie, therefore, the property was held on a resulting trust, the primary claim made by the estate in this claim…”
99.	Pausing there, and I am of course conscious that the judge goes on to make an alternative analysis in the rest of his paragraph 72, I ask myself, what is wrong with that if the judge is minded to find in favour of the respondents? There is nothing there at all about a loan. It can be said, as Lord Justice Rimer has observed, that the documentary evidence was not “all of one piece”. But it was of one piece, if the point of time on which focus must be concentrated is the time of the purchase: see, for instance, the restriction entered on the register at the time of the purchase and the most contemporary accounts given in the documents discussed at paras 14/19 above (March/May 1996). It is only in March 1997 that Dr Elithorn comes forward with his “loan” suggestion (which he later departed from in order to suggest that Madeline had made a gift to him of a half-share in the property). It has to be accepted that Madeline was bamboozled for a time into snatching at that suggestion as some recognition that Dr Elithorn’s advantages were not without obligations too. However nothing said by the judge or by Lord Justice Rimer suggests that that later period is really material to the ultimate decision which has to be made and which must depend on the time of purchase. 
100.	Secondly, it can be said that the judge used the expression “he would be able to pay her back”. However, I do not feel able from that to imply a finding that there was a loan: I say “imply”, because the judge makes no express finding in this passage of any loan. The fact is that Madeline had advanced the full purchase price. If Dr Elithorn was to take advantage of the conditional arrangement for buying into some beneficial interest (up to half) in the property, then in a very real sense he would be paying Madeline back. In strict legal analysis it may be that he would be buying his interest and thus paying the price for doing so de novo: with the result that “paying back” becomes perhaps a loose use of language. Perhaps: but where there was always an understanding that he could buy in a share by contributing a share and meanwhile Madeline was funding the purchase as a whole, I can well understand the judge using the expression “paying back”, especially in the conditional terms in which he spoke (“he would be able to pay her back”). That is not, to my mind, the language of loan and repayment, but of advance and recovery whereby the funder recovers (and thus is paid back, but voluntarily) some undefined portion of the advance. After all, if it was a loan, then what was the obligation to repay? There was no obligation, because payment was going to come (could only come) from the proceeds of sale of Constantine Road, and Dr Elithorn was not obliged to sell it and buy up to a half share of Rose Hill, but he could do so if he wanted to. There was no obligation for him to repay any sum advanced to his account, in any specific sum. There was no obligation on him to buy any particular interest in Rose Hill or to “pay back” any particular sum. There was, on that basis no loan.  
101.	In this connection it is important to observe that the judge must, as it seems to me, have been quite clear as to the respondents’ case. He set it out at para 23 of his judgment where he quoted para 9 of the Particulars of Claim:
“9. It is the Claimants’ case that both the deceased and the Defendant intended as at the time of purchase that their respective shares in the beneficial interest in the property would be determined by their actual contributions to the cost of purchase and it was a mutual expectation of the deceased and the Defendant at the material time that the Defendant would in fact make a contribution of up to half the cost within a very short time of completion of the purchase out of the proceeds of the sale of the London property.” 
102.	Subject to anything expressly contrary to the adoption of that case to be found in the judge’s judgment, it is plain to me that the judge intended to accept it. Thus at paras 50ff the judge quoted extensively from the witness statement made by Madeline shortly before she died. In particular he cited the following passages:
“Our joint intention was that when the purchase of the property was completed the Defendant would provide a portion of the purchase money from the proceeds of another property then owned by him…For this reason the transfer of the property was made in our favour as tenants in common in unspecified shares…At no time since the purchase has the Defendant paid to me any sum whatsoever towards the price of the property or the furniture, nor has he provided any other consideration in respect thereof...I have since been advised that in the above circumstances a Declaration of Trust should have been obtained from the Defendant recording the fact that I was the sole owner of the property but I do not recall being advised of this at the time of the purchase…”
103.	The judge said that he accepted Madeline’s evidence and rejected Dr Elithorn’s evidence to the contrary. He said:
“58. Obviously I have to bear in mind that the deceased is not here to be cross-examined, but in the context of the many letters which I have seen dealing with their relationship after the property had been purchased, on the balance of probabilities, I accept that the facts stated in the statement are true. Where facts in that statement differ from evidence adduced by the Defendant, I do not accept his evidence.” 
104.	What was that evidence from Dr Elithorn? The judge had previously reviewed it. Dr Elithorn’s first witness statement dated 15 August 2006 (shortly before trial) was brief and not very informative. Its implicit basis however was that Madeline had made a gift to him of half the home in consideration of their intent to live there as man and wife and of his work on Madeline’s late husband’s intellectual estate. Thus: “I am the only surviving witness to the joint intent of the deceased and myself as they signed an agreement jointly for the purchase of the property…It was my belief and knowledge that over several years it was Mrs Ettlingers intention that we should reside as man and wife at 71 Rose Hill, which we did on a number of occasions…I will also give evidence that I diligently, with the resources available to me, carried out my side of the agreement…in the task which will bring greater understanding of the values of Professor Ettlinger’s work and also bring his findings to the practical surface of his fellows.” There is nothing whatsoever in that statement to suggest that one of the obligations on his “side of the agreement” was to repay at some indeterminate date a loan made to him by Madeline to assist him in the purchase of Rose Hill. The second witness statement dated 22 September 2006 (even more shortly before trial) was longer but nothing to the point, dilating on Madeline’s “feminine purpose”. As Lord Justice Rimer has observed, neither statement asserted that he had borrowed half the purchase price for Rose Hill from Madeline.
105.	On 28 September 2006 Dr Elithorn submitted both a third witness statement and a document entitled his “Final statement of defence” (which the judge also referred to as a fourth witness statement). The judge set them out in full. They are rambling and even incoherent documents. For present purposes the essence of them is, I think, that Madeline had entered into some agreement whereby he owned half the house and she had security in his beneficial interest for the repayment of monies which he regarded as having been advanced by way of loan to him for other purposes. Thus his third witness statement said:  
“The defendant will argue that he and the late Madeline Ettlinger entered voluntarily into an agreement within which the couple would work together for the better understanding of the life work of the late Professor Ettlinger and the continued practice of the defendant’s skills…
It is admitted that that at all times he has regarded the monies advanced to be a loan and due to be secured against his beneficial rights in any property in which they might be invested.
The bottom line of the defendants position is that he owns at least half the beneficial rights of 71 Rose Hill and that his only indebtedness to the estate is the monies loaned and up to 5% of his earnings…
It seems inalienable that the defendant owns at least half the beneficial rights in 71 Rose Hill and that in the light of the judgments sited in the bundle that Mrs Ettlinger abandoned all rights other than an interest in the defendant as an investment. For the purposes of negotiation it is accepted that the court might not go that far.
It seems more inalienable that I had reached a binding agreement that could only be altered by agreement with Madeline that with her agreement and in the in the event of my virtual imprisonment in London by my Fundamentalist lodger that I would continue to use the whole of the loan that I had been given to develop the practice and the business that we had agreed. In the event I was force[d] through the failure of trust rather than need to return the portion of the loan which represented the Mortgage repayment for 1 Constantine Rd.”
The latter remarks appear to relate to the £70,000 lent in August 1995 to assist him to redeem his mortgage on Constantine Road. 
106.	The final statement of defence or fourth witness statement was to similar effect, viz
“Namely that I had reached a binding agreement that could only be altered by agreement with Madeline and that with her agreement and in the event of my virtual imprisonment in London by my Fundamentalist lodger that I would continue to use the whole of the loan that I had been given to develop the practice and the business that we had agreed.”
107.	 None of these statements puts forward the case that half of Rose Hill was bought for him with money loaned to him for that purpose. On the contrary, his case appears to have been that such loans as he may have received had been advanced to him in cash, as of course the £70,000 had been, for personal or business purposes, albeit secured on his beneficial interest. This would be in line with the case that he had for some time been making to the effect that Madeline had gifted his half share in Rose Hill to him. Thus his solicitors wrote to him on 17 April 2001 that “There is nothing you have told me which would, to my mind, negative the presumption of a gift”. Similarly, in a long account he wrote to his solicitors on 27 May 2003, he said nothing whatsoever about a loan as the basis of his beneficial interest, but simply said that Madeline intended him to have half the property. Thus:
“It had, I should add at this point, been agreed for some time that…Madeleine would be the moneybags and that since Madeleine had no children and I had four and I would be abandoning my home in London, that half of our estate would, after Madeleine’s death go to my children…It would seem, therefore, that up to and beyond the date we completed the transfer document Mrs Ettlinger intended to make us both beneficiaries in equal shares of the property and that at some later date she, for reasons known to herself, regretted that decision.”
108.	Lord Justice Rimer has referred also (see paras 54/57 above), although the judge did not, to remarks made by Dr Elithorn during his opening, after he had made an affirmation, so that his submissions could be treated as part of his evidence, and to passages in his formal evidence. I would accept Lord Justice Rimer’s careful exposition of these passages. However, as Lord Justice Rimer has shown, taken as a whole they are muddled and confused because they prevaricate between (a) on the one hand a denial of the respondents’ case that the original arrangement was conditional on a contribution from Dr Elithorn from the contemplated sale of his Constantine Road home as well as the assertion of a life-long loan from the very beginning, and (b) on the other hand a rationalisation of an ultimately life long loan which was part of a later arrangement after he had chosen not to sell his home but to rent it to a tenant whom he had described in his witness statements as his fundamentalist lodger. What is clear, however, is that Dr Elithorn’s oral remarks and evidence did not impress the judge, because, as he observed in the passage from his judgment cited above, where Dr Elithorn’s evidence differed from that proffered in Madeline’s statement, “I do not accept his evidence”. That conclusion is not at all surprising in the face of the earliest correspondence supporting Madeline’s case, the defects in Dr Elithorn’s own written evidence in the run-up to trial, and finally his own muddled performance at trial which both departed from his written evidence and did not steer a consistent course in itself. 
109.	So far, then, I have considered the judge’s judgment down to his conclusion accepting the respondents’ case of a conditional agreement. The judge then continued at his paragraph 72:
“…If I am wrong on that, so far as there being constructive trust is concerned, it seems to me that, in my judgment, looking at the judgment in Lloyds Bank v. Rossett and the passages from Lord Bridge to which I have referred, any terms of the constructive trust were that when the London property was sold the deceased’s monies advanced for the purchase on behalf of the Defendant were to be repaid. That, in fact, never happened. In fact the deceased made further loans to him which were eventually repaid without interest, but the conditional agreement was never met by the Defendant at all and has not been met now.”
110.	It is difficult to know what the judge is saying here, but I observe that this is his alternative solution (“If I am wrong about that”). Why is there an alternative? Lord Justice Rimer considers two possible reasons. One is that the judge was proceeding on an alternative factual basis, the other that he was contrasting the cases of a resulting trust and alternatively a constructive trust. He prefers the latter solution because there is no express statement that the judge is contrasting situations where there is or is not a loan. I am prepared to assume that Lord Justice Rimer is correct in saying that there is a contrast between the resulting trust and the constructive trust analyses: after all, those were the alternative ways in which the respondents advanced their claim – see paragraphs 9 and 12 of the judge’s judgment. On the other hand, if it be the case that in this final passage the judge is assuming, as Lord Justice Rimer ultimately concludes that he is, a situation where there always was a loan, then it would in my judgment be necessary to conclude that the judge was also contrasting a factual as well as a legal case. For so far he has not found a loan, on the contrary he has accepted the respondents’ case of a conditional arrangement.
111.	The question remains, has the judge made any finding that there was a loan to Dr Elithorn? Even in this alternative passage there is no such express finding. On the contrary, the judge ends by referring again to “the conditional agreement”. That is a direct reference back to the beginning of paragraph 72 where the judge said “I am satisfied that there was a conditional agreement to that effect…” That is simply not consistent with a finding of a loan which would support a beneficial interest in favour of Dr Elithorn. Under a conditional arrangement there could be no obligation for Dr Elithorn to repay any loan, nor would it be possible to say what the loan or its extent was. Still, the language of the judge which has to be considered is “any terms of the constructive trust were that when the London property was sold the deceased’s monies advanced for the purchase on behalf of the Defendant were to be repaid”. I emphasise the judge’s words “any terms”, which is a slender basis on which to hang a positive finding in the context of this passage as a whole. The judge describes such an agreement as a “conditional agreement”. What is it? It seems to me that it remains the conditional agreement that if Dr Elithorn sells his flat and uses the proceeds to buy up to a half share in Rose Hill by paying Madeline back in respect of the money she had advanced, he should be entitled to an appropriate share in the property. In such circumstances the phrase “monies advanced for the purchase on behalf of the Defendant” clearly can only mean “monies conditionally advanced on behalf of the Defendant”: in other words this is not describing a loan to Dr Elithorn but the arrangement whereby Madeline was willing to cede up to a half share in the property to Dr Elithorn in return for the repayment to her (in the sense described above) of up to half of what she had advanced in purchase of the property. It is only in this sense that the monies had been advanced “on behalf of the Defendant”, ie in the sense that Dr Elithorn could take advantage of that advance to the extent of buying in up to a half share of the property with funds generated by the sale of his own London home. 
112.	The other language in this section to which reference has been made is the final sentence: “In fact the deceased made further loans to him which were eventually repaid without interest…” It is suggested that by inference or implication that means that the arrangement concerning the purchase of Rose Hill was itself a loan. In my judgment, however, that makes no sense. No loan has been found to have existed in respect of the purchase of Rose Hill. There were no “further loans”. There was one previous loan, the £70,000, to be used to repay the mortgage on Constantine Road, which was eventually repaid. That was an earlier arrangement. This is clearly extremely loose even inaccurate language being used by the judge. That earlier loan was only a “further loan” in the sense of being a loan which was a further arrangement. It is impossible, however, to imply from this passage that the arrangement concerning Rose Hill itself involved a loan, for the judge immediately after speaking of “further loans” contrasted those with the Rose Hill arrangement when he said “but the conditional agreement was never met by the Defendant at all”. He does not say that a loan was not repaid, but that the conditional agreement was not met. 
113.	It is highly discouraging that the litigants in these proceedings, and the judges of this court, have had to debate over the proper interpretation of the judge’s findings in his judgment below. However, a judgment is not a statute, and it is necessary to come to a rounded conclusion on all the material and the judge’s judgment as to which case the judge was intending to accept and which case he was intending to reject. It seems to me impossible to conclude that the judge was intending to accept Dr Elithorn’s (sometime) case of a loan made at the outset (as distinct from some later arrangement) when that case to the extent that it was made at all was made late, and was inconsistent with earlier evidence and pleadings, and when the opposite case was expressly accepted by the judge (the “conditional agreement”) and when Dr Elithorn’s evidence was rejected to the extent that it differed from Madeline’s. 
114.	Lord Justice Rimer has interpreted the judge’s judgment otherwise. He has proceeded by asking himself whether in the critical passage of that judgment the judge was making an “implied” finding that there was no loan arrangement (see para 72 and again para 73 above). In my respectful judgment, the question is not so much whether the judge has made an implied finding that there was no loan arrangement – after all he had already rejected Dr Elithorn’s evidence to the extent that it differed from Madeline’s – but whether he made an express finding that there was such a loan arrangement. In my judgment, his express finding was plainly, both in his paragraph 71 and again in his paragraph 72, of a conditional agreement, in other words an express adoption of the respondents’ pleaded case (see para 10 above). Although I fully accept that the way in which he has expressed himself is imperfect, it is impossible to derive from that conclusion of a conditional arrangement, which is incompatible with a loan and was expressly contrasted by the judge with a loan, a reading of his judgment whereby he first adopts a case different from the case which he said he was adopting, and secondly, having done that, goes on to award judgment to the wrong party. Whatever criticisms might be justly made of the judge’s judgment, such an overall reading of it does not attract me and I would reject it for the reasons I have sought to explain above.  
115.	I would therefore dismiss this appeal.     
116.	Since writing this judgment, I have also had the advantage of reading Lord Justice Wilson’s judgment in draft. Since he agrees with Lord Justice Rimer’s reasons, it is unnecessary for me to lengthen mine, save to say that I recognise the cogency of their combined judgment that this appeal should be allowed, but regret that I am unable to join them in their conclusion. I would merely add that, if the appeal is to be allowed, as it will be, then by parity of reasoning to that of Lord Justice Wilson in his criticisms of the judge’s judgment, it is difficult to see that the judge has done justice to the respondents’ case, which after all he purports to accept together with their evidence, and disaster as it would be for the parties, I do not see how a retrial could be avoided.