1. Express Trusts: Declaration of Trust Flashcards
What is equity?
A distinct body of rules and principles.
What are the purposes of equity?
To mitigate the rigours of the common law and provide more options for redress.
What is the most important form of equity?
The trust.
What are the maxims of equity?
‘He who comes to equity must come with clean hands’ and ‘Equity will not assist a volunteer’.
What does ‘property’ encompass?
Money, shares, land, personal possessions.
What is the difference between legal and equitable ownership?
Legal ownership is outright ownership, while equitable ownership involves a trust.
What is a trust?
An arrangement where a trustee holds property for the benefit of another.
Who is the settlor?
The person who creates a trust.
Who can be a trustee?
A third party or the settlor themselves.
What is a lifetime trust?
A trust created during the settlor’s lifetime.
Who are the beneficiaries of a trust?
Those who benefit from the trust.
What is the duty of a trustee?
To deal with property for the benefit of the beneficiaries.
Who can enforce the duty of a trustee?
The beneficiaries.
What is the role of equity in relation to the common law?
To mitigate its rigours.
What does equity focus on?
The consciences of the parties involved.
What are equitable remedies?
Remedies provided by equity.
What is the role of equity in providing redress?
To provide more options for redress.
What is the concept of trust?
When one person holds legal interest and another holds equitable interest in a property.
What is an absolute owner?
Someone who has both legal and equitable ownership of a property.
What is the practical significance of equitable interest in an absolute owner?
None, as they already have full ownership in law.
What is a settlor?
The person who creates the trust and sets out its terms.
What are the terms of the trust often referred to as?
The declaration of trust or trust deed.
What must the settlor ensure once they have set out the terms of the trust?
That the trustee gets legal title to the trust property.
When is the trust considered complete?
When the trustee has legal title to the trust property.