As a practical matter, equity’s purchase money resulting trust (PMRT) is a fancy term for application of unjust-enrichment doctrine in situations where X purchases property, but Y takes legal title to it. If Y is unjustifiably enriched thereby, Y holds the property upon a PMRT for the benefit of whoever should have it. Was X’s intent donative? There is a presumption that it was not. If there was donative intent, no PMRT. Y gets to keep the property. Unlike an express trust of land, a PMRT of land is exempt from the writing requirement of the statute of frauds applicable to trusts. So is the constructive trust. See generally §8.15.5 of Loring and Rounds: A Trustee’s Handbook (2023) (statute of frauds), available for purchase at Loring and Rounds: A Trustee's Handbook, 2023 Edition | Wolters Kluwer Legal & Regulatory. Section reproduced in appendix below. The number of PMRT decisions that have been handed down by English and U.S. courts over the centuries is huge.

Long before Lord Mansfield in 1750, via Moses v. Macferlan, had planted the seeds of unjust enrichment doctrine in England’s legal system, resulting “uses” were ubiquitous, the use being a precursor to the modern trust. In England, during the 15th and 16th centuries, the practice of conveying legal title to land with a reservation of beneficial interest became so common that the usual inference was that a gratuitous conveyance of land was subject to a retained use. The courts held that the transferee who gave no consideration presumptively held upon a resulting use for the transferor. Today, a gratuitous transfer of property, ipso facto, raises no such presumption. The PMRT is a vestige of the old regime.

Consider the 2021 Nebraska case of Malousek v. Meyer, 962 N.W.2d 676 (payor deceased, transferee alive). Molly, now deceased, had titled in the name of her stepson a boat she had purchased. Stepson intended to keep the boat. There was no documentation suggesting he should not. The special administrator of Molly’s estate asserted the boat was an estate asset, that the stepson was the trustee of a PMRT. The special administrator prevailed due to compelling extrinsic evidence that Molly had titled the boat in the stepson’s name for reasons of convenience rather than benefaction. Though there also had been tax reasons why she had not taken title, there had been no illegality. Had there been, “the policy against unjust enrichment of the transferee would have been outweighed by the policy against giving relief to a person who has entered into an illegal transaction.” Id. He who comes into equity must come with clean hands. Avoiding publicity might be another innocuous reason for a payor not to take title. The personal representative had a fiduciary duty to take control of and secure all property to which the probate estate had been entitled. In the case of a will with a pour-over provision, not our situation, a recipient trustee has a fiduciary duty to see to it that the personal representative reasonably leaves no stone unturned.

In 1830, New York, by statute, abolished the PMRT of land. Several other states followed suit. There is less here than meets the eye. As a practical matter, all that was voided was PMRT’s archaic presumption that the payor lacks donative intent. Courts since time immemorial have been end-running these legislative initiatives by defaulting to unjust-enrichment jurisprudence. When a transferee of property has been unjustly enriched due to the absence of donative intent on the part of the purchase-price payor, the procedural equitable remedy of constructive trust is imposed on the property, not a PMRT. See, e.g., Justice Cardozo’s decision in Foreman v. Foreman, 251 N.Y. 237 (1929) (payor alive, transferee deceased). PMRT doctrine minus the archaic presumption that the payor lacks donative intent renders it functionally indistinguishable from constructive trust doctrine. See Rest. of Restitution §160 (1936). Now that the one-stop jurisprudence of equitable remediation for unjust enrichment via imposition of constructive trust has fully matured, see generally Restatement of Restitution (1936), the PMRT perhaps has outlived its usefulness. It should fall to the courts, however, not the legislatures, to nudge the PMRT into retirement. In the trust space, reform via codification inevitably leads to more doctrinal complexity, redundancy, and confusion.