In Turner v Jacob [2006] EWHC 1317, the High Court, however, did not allow a beneficiary to chose an earlier payment out when there was still money in the trustee’s bank account to satisfy the beneficiary’s claim.
In this case a husband gave £75,000 to his estranged wife to pay off the mortgage of a property on the basis that she would give the property to her daughter. She did not do this. The judge held that the £75,000 was held on trust for the daughter. The mother then dissipated all but £10,339 of this money, but that amount was still held on trust for the daughter. The mother put more money into her account as an attempt to remedy the breach that had taken place, but that money could not replace the dissipated money as per Roscoe v Winder (see below). The mother then bought two properties with the money she had taken from the account, which went up in value. She died and left the residue of her estate, which included what was in the bank account, to her daughter. The daughter sensibly wanted to trace her £10,399 into the second property, rather than have it treated as a debt due to her out of the residuary estate which she had, anyhow, inherited. She was not allowed to do so because £10,399 was still available in the account. Patten J had earlier rejected claims by the daughter to a common intention constructive trust interest or an equitable proprietary interest and was happy to dismiss her tracing claim without any detailed consideration of the issues.