The law surrounding illegal conduct & trusts is in a muddle, says Steve Evans
The maxim of equity “he who comes to equity must come with clean hands” used to be as inviolable as it was pithy. For nearly two centuries, courts of equity denied equitable relief to a claimant whose conduct was tainted by illegality. Rationally enough, this was to deter persons from entering into illicit transactions.
Tinsley v Milligan
However in 1994, the House of Lords in Tinsley v Milligan [1994] 1 AC 340, [1993] 3 All ER 65, sidestepped this maxim. That case concerned a resulting trust. Two lesbian partners both contributed to the purchase of a house, but the name of one of them was deliberately kept off the title so that she could pretend she did not have that asset and she illegally claimed benefits. Nevertheless, when the house was sold following the breakdown of the relationship, she still wanted her share of the sale proceeds because of her contributions to the purchase price of the house—and she
