Mother wins three-decade legal battle over property against son

Colombo, June 9 (Daily Mirror) - A mother has emerged victorious in a 30-year legal battle against her son over a residential property after the Supreme Court dismissed the son's appeal, ruling that the property had been transferred to him solely to facilitate a bank loan, not with the intention of transferring its beneficial ownership.

Accordingly, the Supreme Court has dismissed an appeal filed by the son challenging lower court rulings that declared he was holding a residential property in trust for his mother, reaffirming important legal principles governing constructive trusts under Section 83 of the Trusts Ordinance.

A three-judge bench comprising Chief Justice Preethi Padman Surasena, Justice Janak De Silva and Justice Arjuna Obeyesekere unanimously upheld the judgements of the District Court of Mount Lavinia and the Civil Appellate High Court, which had ruled in favour of the mother.

The dispute was based on a property in Mirihana that the mother transferred to her son, Thilakasiri, by deed in October 1987. Although the deed appeared to be an outright transfer, the mother maintained that the transaction was undertaken solely to enable her son to obtain a bank loan using the property as security so that she could finance an extension to the family home.

In her evidence, it was revealed that the mother never intended to transfer the beneficial ownership of the property and expected her son to recover it once the bank loan had been settled. She subsequently instituted legal action in 1997, seeking a declaration that her son held the property in trust for her and an order compelling its transfer back to her.

The son, however, contended that he had genuinely purchased the property for Rs. 125,000 and denied that the transfer was merely a financing arrangement.

In a detailed judgement authored by Justice Obeyesekere, the Supreme Court examined the legal framework governing constructive trusts and the concept of “attendant circumstances” under Section 83 of the Trusts Ordinance.

The Court observed that while the Prevention of Frauds Ordinance and the Evidence Ordinance generally prohibit oral evidence from contradicting the terms of a written deed, Section 83 permits courts to consider surrounding circumstances to determine whether a transferor truly intended to part with the beneficial interest in a property.

After reviewing the evidence, the Court found that several factors supported the mother's claim. These included evidence that she had originally purchased the land and built the house with considerable difficulty, that the property was her only residence, and that the bank loan obtained through the transfer was used to expand the family home.

The Supreme Court held that the mother had not intended to transfer the beneficial ownership of the property to her son.