(Real Property Law, § 94.) Unless, therefore, the facts were such, that a constructive trust would have been raised by a court of equity, Malex was the sole owner, in law and in equity, of all the properties conveyed. The principle governing the erection by a court of equity of a constructive trust in cases of a similar character has been recently stated in Foreman v. Foreman ( 251 N.Y. 237, 240), to be as follows: "The rule is now settled by repeated judgments of this court that the statute does not obstruct the recognition of a constructive trust affecting an interest in land where a confidential relation would be abused if there were repudiation, without redress, of a trust orally declared." As authority for the principle enunciated the court cited Sinclair v. Purdy ( 235 N.Y. 245, 253); Gallagher v. Gallagher ( 135 App. Div. 457; 202 N.Y. 572); Leary v. Corvin ( 181 N.Y. 222, 229); Goldsmith v. Goldsmith ( 145 N.Y. 313); Wood v. Rabe ( 96 N.Y. 414). It also quoted the following statement from Sinclair v. Purdy ( supra): "It is not the promise only, nor the breach only, but unjust enrichment under cover of the relation of confidence, which puts the court in motion.
( Garfield v. Hatmaker, 15 N.Y. 475; Siemon v. Schurck, supra; Ocean National Bank v. Olcott, 46 N.Y. 12; Hegstad v. Wysiecki, 178 App. Div. 733.) If there is an agreement in writing by the person taking title amounting to a declaration that he holds merely for the use of the person furnishing the consideration and will convey upon demand, the case falls under the Real Property Law, sections 92 and 93. The title automatically vests in the actual owner. (Cf. Bing v. People, 254 N.Y. 484.) Where the declaration is oral, enforcement as between the immediate parties meets not only the obstacle of the Real Property Law, section 94, but also of the Statute of Frauds, Real Property Law, section 242. The latter may be overcome "where a confidential relation would be abused if there were repudiation, without redress" ( Foreman v. Foreman, 251 N.Y. 237, 240); or, what is perhaps the same thing, where there has been part performance by unequivocal acts clearly referable to the agreement. ( McKinley v. Hessen, 202 N.Y. 24.) The barrier of section 94, as between the immediate parties, may be passed when substantially the same facts exist.
A constructive trust arises under New York State law when one person in a confidential relationship with another transfers property in reliance on the transferee's promise to reconvey the property; if the promise is breached and unjust enrichment results, a constructive trust is imposed on the property in the transferor's favor. See Simonds v. Simonds, 45 N.Y.2d 233, 380 N.E.2d 189, 408 N.Y.S.2d 359 (Ct. Appeals 1978); Foreman v. Foreman, 167 N.E. 428, 251 N.Y. 237 (Ct. Appeals 1929) (Cardozo, J.); Kopelman v. Kopelman, 710 F. Supp. 99, 102 (S.D.N.Y. 1989). In the leading case of Foreman v. Foreman, the New York State Court of Appeals imposed a constructive trust to compel the return to a father of property that had succeeded from his intestate wife to their infant son.
Thus, a constructive trust cannot be imposed on this basis. The conclusion that a constructive trust may not be imposed in this case is consistent with the result reached in Foreman v. Foreman, 251 N.Y. 237, 167 N.E. 428 (1929). There, the court imposed a constructive trust in favor of a husband over property to which his deceased wife held legal title upon her death, and which would have otherwise passed to her son.
In developing the doctrine, equity has laid down four requirements for its invocation. First, there must be a confidential or fiduciary relationship; secondly, there must be a promise, either express or implied; thirdly, there must be a transfer of property in reliance thereon; and finally, there must be unjust enrichment to the transferee ( Sharp v. Kosmalski, 40 N.Y.2d 119, supra; Foreman v. Foreman, 251 N.Y. 237; Janke v. Janke, 47 A.D.2d 445, affd 39 N.Y.2d 786). However, the applicability of the doctrine is not rigidly limited.
The rule was clearly stated by the Appellate Division, Second Department, in Petrukevich v. Makaimovich ( 1 A.D.2d 786) as follows: "Where a relation of confidence has been abused, and a person has never had title to the property but has expended money in the improvement of the property on the basis of an oral promise to convey, which money does not constitute the entire consideration for the purchase of the interest claimed, that person is entitled, not to a conveyance of the property, but only to an equitable lien thereon for the amount expended. ( Leary v. Corvin, 181 N.Y. 222; Foreman v. Foreman, 251 N.Y. 237, 242; McCarthy v. McCarthy, 284 App. Div. 813.) In such case equity grants relief despite the fact that the oral promise to convey is violative of the Statute of Frauds.
See id. Parole evidence may be relied upon to rebut the inference of a gift. Foreman v. Foreman, 251 N.Y. 237, 167 N.E. 428 (1929) (Cardozo, C.J.); Restatement of Trusts (Second) § 443, cmt. a; 5 Austin Wakeman Scott, The Law of Trusts § 443; New York Annotations to the Restatement of the Law of Trusts §§ 442, 443 (1947). As Chief Judge Cardozo noted in Foreman:
The New York court might find a constructive trust on the present facts. Foreman v. Foreman, 251 N.Y. 237 ( 167 NE 428), and cases cited therein. Were this the only basis for our decision we might re-examine the question with more thoroughness, but under either interpretation of the statute the plaintiff must fail.
A constructive trust will be imposed where one party holding title to property is under an equitable duty to convey it to another (5 Scott, Trusts [3d ed.], § 462). In order to establish a constructive trust there must be (1) a promise — express or implied; (2) a transfer of property in reliance thereon; (3) a confidential relationship and (4) unjust enrichment (Foreman v Foreman, 251 N.Y. 237, 240; Sinclair v Purdy, 235 N.Y. 245, 253). Although not directly expressed in language, the facts in the record indicate that all of these elements are present in the instant case.
The law in New York has been long-settled that "the statute of frauds will not obstruct the recognition of a constructive trust affecting an interest in land where a confidential relation would be abused if there were repudiation, without redress of a trust orally declared." Foreman v. Foreman, 251 N.Y. 237, 240, 167 N.E. 428, 429 (1929) ." The papers submitted in support of the Defendant's motion for summary include an attorney's affirmation, memorandum of law, affidavit of the Defendant Jill Silverman, and attached Exhibits "A" — "J".