• 1010 WILSHIRE BLVD. #1404, LOS ANGELES, CA 90017

Resulting Trusts in California

OVERVIEW

Resulting trusts come up all the time in California real estate disputes where legal title and “who really owns the property” don’t line up. A classic example is when one person pays for a property, but the title is recorded in someone else’s name. In those situations, California courts may treat the “title holder” as a trustee and recognize that someone else is the true beneficial owner.

This page explains what a resulting trust is, when it arises, and how it can be used in quiet title, partition, and co-ownership disputes.

What Is a Resulting Trust?

A resulting trust is an equitable remedy the court uses when the facts show that the person holding legal title was not meant to enjoy the beneficial ownership.

California courts have described a resulting trust as arising when property is transferred under circumstances indicating that the transferee was not intended to take the beneficial interest. The trust is implied by law to carry out the parties’ actual intentions, even if nothing was put in writing and there was no fraud.

Historically, former Civil Code section 853 provided:

“When a transfer of real property is made to one person, and the consideration therefor is paid by or for another, a trust is presumed to result in favor of the person by or for whom such payment is made.”

Although section 853 was repealed in 1987 as part of a trust-law overhaul, the Legislature made clear that the repeal was not intended to disturb California case law on purchase-money resulting trusts. Courts still apply the same common-law principles.

Purchase-Money Resulting Trusts: The Basic Rule

The most common form is the “purchase-money resulting trust.” In broad strokes:
  • If A pays the purchase price
  • And title is taken in B’s name
  • Then B may hold title in resulting trust for A, in whole or in part
California decisions have repeatedly adopted the Restatement rule that where property is transferred to one person and the purchase price is paid by another, a resulting trust arises in favor of the payor, absent contrary intent. Cases also recognize that if someone pays only part of the price, the resulting trust can arise pro tanto, i.e. in proportion to that contribution.

Key points:

  • The “consideration” can be cash, assumption of a loan, or even discharge of a pre-existing debt.
  • The trust is about intent: courts look at whether the parties intended the payor to be the true owner, with the title holder serving as a kind of nominee.
  • The presumption can be rebutted by evidence that the payor intended a gift or some other arrangement.

The “Gift Presumption”: Spouses and Children

There is an important exception to the general rule.

Where the payor puts title in the name of a spouse, child, or other “natural object of bounty,” courts presume a gift, not a resulting trust, unless the payor proves otherwise.

The California Supreme Court has cited Restatement of Trusts section 442 for the rule that if the transferee is a wife, child, or other natural object of bounty, a resulting trust does not arise unless the payor shows he or she did not intend to make a gift. The relationship itself is enough to raise an inference of donative intent, and the burden shifts to the payor to rebut that.

In practice:
  • Parent pays the entire purchase price, puts the title in the adult child’s name: presumption of a gift, payor must prove there was no intent to give.
  • Spouse pays but places title in the other spouse’s sole name: again, there is a strong gift presumption to overcome.
This distinction matters a lot in family and inheritance disputes, and it shapes how the pleadings and evidence should be framed.

Resulting Trust vs. Constructive Trust vs. Record Title

Resulting trusts are often confused with constructive trusts and with simple title disputes.
  • A resulting trust is “intention-enforcing.” It arises because, as between the parties, the law presumes they intended the payor to be the beneficial owner.
  • A constructive trust is “fraud-rectifying.” It is imposed to prevent unjust enrichment, usually where there is fraud, undue influence, or other wrongful conduct.
Record title carries a strong presumption under Evidence Code section 662 that the owner of legal title is also the owner of the beneficial interest.
Evidence Code section 662 provides that this title presumption can be rebutted only by clear and convincing evidence. In resulting trust cases, that means:
  • You can’t win by “equity vibes” alone
  • You must bring in solid, detailed proof of who paid what, why title was structured the way it was, and what everyone actually intended at the time of the transfer
Courts regularly allow parol evidence (testimony, correspondence, course of dealing) to establish a resulting trust and to rebut the title presumption.

Common Real Estate Scenarios Involving Resulting Trusts

Resulting trust theories show up in a lot of real-world property disputes, for example:

1. Title in one person’s name “for financing only”

  • One co-owner has better credit, so the loan and title go in that person’s name, while both parties contribute funds.
  • Later, the title holder claims they “own” the whole property. The non-titled co-owner sues to establish a resulting trust for their share.

2. Parent–child purchases

  • Parent funds the entire down payment and mortgage but puts the title in the child’s name for “estate planning” or convenience.
  • On divorce, death, or a falling-out, the parent (or estate) may seek to prove the transfer was not intended as a full gift.

3. Straw buyer / nominee arrangements

  • A business partner, friend, or relative takes title for a limited purpose (e.g., to hold the property until a flip or resale), all with the understanding that someone else is the real owner.
  • If creditors or that title holder try to claim the property, the payor can invoke a resulting trust.

4. Partial contributions

  • Two people contribute different amounts to the purchase, but title is taken in one name or in equal undivided shares.
  • Courts may find a resulting trust in proportion to the actual contributions to the purchase price.

These fact patterns often appear alongside partition claims, quiet title actions, and fraud or breach of fiduciary duty causes of action.

Proving a Resulting Trust in Court

In litigation, resulting trust claims typically show up in:

  • Quiet title causes of action
  • Declaratory relief claims about beneficial ownership
  • Partition actions where one party says “you’re on title, but really you’re just holding it for me”

Courts generally require “clear and convincing” evidence to declare that a resulting trust exists. Useful evidence includes:

  • Escrow documents and settlement statements showing who actually paid
  • Wire transfers, cancelled checks, and bank records tying the payor’s funds to the purchase
  • Written communications (emails, texts, messages) where the parties talk about who the property really “belongs” to
  • Tax returns (who claimed mortgage interest, property taxes, depreciation)
  • Insurance, rent collection records, and other documents showing who treated the property as their own

If the court finds that a resulting trust exists, it can:

  • Declare that the title holder holds all or part of the property in trust for the payor
  • Order conveyance of legal title to match beneficial ownership
  • Coordinate the resulting trust determination with any partition or sale order if there are multiple co-owners

Relationship to Partition and Quiet Title

Resulting trust issues often sit underneath partition and quiet title disputes.

Examples:

  • Two people are on title as 50/50 owners, but one paid the entire purchase price and all expenses. That person may claim a resulting trust for more than 50% and then seek partition to force a sale on those adjusted percentages.
  • A third party is placed on title for a limited purpose (e.g., as a lender or nominee), and later someone files a partition action including that party. The court may find that the third party holds only bare legal title in resulting trust and has no true partition rights.

A careful resulting trust theory can significantly affect who has standing to sue, what percentage each party is awarded, and how sale proceeds or buyouts are calculated.

Why Resulting Trust Law Matters in California Real Estate Litigation

For many California real estate and business disputes, the real fight is not just “should the property be sold,” but:
  • Who actually owns what percentage, and
  • On what theory does the court get there
Resulting trusts give courts a way to get past the face of the recorded deed and enforce the parties’ real arrangement, particularly where the recorded title structure was driven by credit, convenience, or tax/estate planning concerns.

Handled correctly, a resulting trust claim can:

  • Protect a payor who would otherwise be cut out of title
  • Protect family or business assets from being treated as someone else’s separate property
  • Defeat or limit the rights of a party who appears on title but never truly owned the property

How Vokshori Law Group Can Help

At Vokshori Law Group, we represent clients across California in real estate disputes where legal title and beneficial ownership don’t match, including:

  • Resulting and constructive trust claims
  • Quiet title and declaratory relief actions
  • Partition of co-owned property
  • Inherited property and family dispute litigation
  • Cases involving nominee title holders, straw buyers, and complex financing

We regularly work with detailed financial records, escrow files, and witness testimony to build or defend resulting trust theories and integrate them into broader real estate litigation strategy.

FAQs About Resulting Trusts in California

Is a resulting trust the same as a constructive trust?

No. A resulting trust enforces the parties’ presumed intent when someone else paid the purchase price. A constructive trust is used to prevent unjust enrichment, usually where there is fraud or other wrongful conduct.

Do I need a written agreement to claim a resulting trust?

Not necessarily. Courts allow parol evidence to prove a resulting trust, but you must meet a high evidentiary burden.

What if the property is titled in my spouse’s or child’s name?

Courts may presume a gift in that situation, and you will have the burden to prove that no gift was intended.

Can a resulting trust help in a partition action?

Yes. Establishing a resulting trust can affect each party’s percentage interest and how sale proceeds or buyout amounts are allocated.

How do I know if I have a resulting trust claim?

If you paid part or all of the purchase price and title is in someone else’s name, or if title percentages don’t match real contributions and intent, it is worth having an attorney review your facts.

Protect Your Ownership Rights — Consult a California Real Estate Attorney Today

Disputes over who truly owns a property can quickly become legally and financially overwhelming. If you’ve contributed to the purchase of a California property that’s titled in someone else’s name, or if a co-owner is disputing your share, you may have a strong resulting trust claim. But these cases require precise legal strategy and compelling evidence.

The real estate attorneys at Vokshori Law Group are here to help you establish the correct ownership, challenge improper title claims, and assert your rights in court. We routinely handle resulting trust, constructive trust, quiet title, and partition litigation across California and can guide you through every step with clarity and confidence.

Don’t leave your ownership to chance. Get the legal protection and advocacy your case demands. Contact Vokshori Law Group at (855) 855-2608 today!

Your property, contributions, and rights deserve to be recognized and we’re here to make sure they are.

Testimonials

Antonio Perez
☆ ☆ ☆ ☆ ☆

“Excellent service thank you vokshori for you service”

Nora Harlow
☆ ☆ ☆ ☆ ☆

“My experience with Vokshori Law Group has been brief (so far) but exceptionally positive. Within a day or two they solved my initial problem and we are well on our way to dealing with the rest. Five stars.”

SB Luxe
☆ ☆ ☆ ☆ ☆

“Stephen Vokshori has exceeded our expectations and couldn't recommend him enough. He has helped us twice already in regards to a real estate matter and are very satisfied. Thank you so much!”

Laurel S
☆ ☆ ☆ ☆ ☆

“If I could give more stars I surely would. I was extremely stressed out about this whole situation with my house, and a bad realtor. I was about ready to give up hope when I Googled Vokshori Law Group.”

We Are Here to Help

"*" indicates required fields

This field is for validation purposes and should be left unchanged.

Are you ready to work with
a different kind of law firm?

If you need legal assistance, don't hesitate to contact us today.
We are here to help you achieve a successful outcome
and protect your rights every step of the way.

Free Consultation

Main Office

Practice Area

Bankruptcy

Business Law

Business Litigation

Elder Financial Abuse

Estate Planning

Foreclosure Defense

Personal Injury

Real Estate Litigation

Real Estate Transactions

Follow Us

Facebook-f Linkedin-in X-twitter Youtube
  • Working Hours

Monday to Friday: 9.00 AM – 5.00 PM

Saturday: Closed

Sunday: Closed

© 2025 Vokshori Law Group. All rights reserved. Sitemap | Privacy Policy