We Can Work It Out—deciding ownership of belongings (Wood v Lowe)

We Can Work It Out—deciding ownership of belongings (Wood v Lowe)

How does the court decide ownership of a family’s belongings following bankruptcy? Simon Passfield, barrister at Guildhall Chambers, examines Wood v Lowe and suggests that ownership of an item is dependent on which individual can produce the best evidence to establish the true owner’s identity.

Original news

Wood v Lowe and others [2015] EWHC 2634 (Ch), [2015] All ER (D) 133 (Sep)

The Chancery Division ruled that Beatles memorabilia, among other things, had not been gifted to the bankrupt’s wife and daughter, but belonged to the bankrupt at the date of his bankruptcy order and, accordingly, vested in the trustee in bankruptcy.

What was the background to the application briefly?

A trustee in bankruptcy, T, obtained a warrant under section 365 of the Insolvency Act 1986 (IA 1986) to search premises owned by the bankrupt, his wife and their daughter for property forming part of the bankrupt’s estate. Following the execution of the warrant, T compiled an inventory of 213 items and the respondents (and other third parties) were given an opportunity to assert an interest in those items. The court was required to determine the ownership of 102 items, including Beatles memorabilia, vintage jukeboxes and various vehicles.

What were the legal issues that the judge had to decide in this application?

Firstly, in determining the ownership of each of the disputed items, the judge was required to consider whether there is an evidential presumption that chattels belong to the owner of the premises.

Secondly, it was necessary to determine whether certain tools owned by the bankrupt were excluded from his estate by virtue of IA 1986, s 283(2)(a).

What were the main legal arguments put forward?

T argued that the cases of South Staffordshire Water Company v Sharman [1896] 2 QB 44 and Re Cohen [1953] Ch 88, [1953] 1 All ER 378 were authority for the proposition that there is a presumption that chattels on premises belong to the owner of the premises.

In South Staffordshire, the court had relied on such a presumption to determine the ownership of lost property in a dispute between the owner of the land on which the property had been found and the finder of the property.

In Re Cohen, the court had relied on this presumption to determine the ownership of bundles of money secreted away in the home of a married couple where there was no evidence of w

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.