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Elements of Constructive Trust Not Demonstrated 

The plaintiff had conveyed her 25% interest in real property to her cousin, allegedly with the understanding plaintiff would share in the proceeds if the property were sold. Eventually the cousin was deeded 100% of the property. The cousin lived on the property from 1989 to 2005.  The cousin deeded the property to her brother and his wife, the defendants. The defendants maintained the house and paid taxes on it, although they did not live there.  The plaintiff did not contribute to the property maintenance or taxes and did not submit any proof that the defendants had been unjustly enriched by owning the property (i.e. rental income). The Second Department upheld the referee in finding that the plaintiff had not proved the elements of a real-property constructive trust.  The Second Department explained the elements as follows:

“The elements of a constructive trust are a confidential or fiduciary relationship, a promise, a transfer in reliance thereon, and unjust enrichment… . These requirements, however, are not to be rigidly applied …. The ultimate purpose of a constructive trust is to prevent unjust enrichment, and it will be imposed ” [w]hen property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest'” ….  Broderson v Parsons, 2013 NY Slip Op 03050, 2nd Dept, 5-1-13

 

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