3 Certainties Of Express Private Trusts

Question 1

What are the 3 certainties required whether a valid express private trust has been created?

Answer 1

1. The 3 certenties are present
2. There is a trustee
3. They are ascertainable human beneficieries

Question 2

What are the 3 certainties for express trusts?

Answer 2

1. Certainty of intention - settlor must have intention to create a trust
2. Certainty of subject matter - the property to be held on trust and must be identified
3. Certainty of objects - the beneficiaries of the trusts must be identified.

Question 3

What 3 ways can a settlor show that they show intention

Answer 3

1. Written words
2. Spoken words
3. Conduct

Question 4

What are the 3 elemements of certainty of intention?

Answer 4

1. Must be manisfested while the settlor owns the property
2. Settlor must intend the trust tro take effect immediately not some time in the future
3. Precatory expressions are not enough - an expression of mere hope or wish will not create a trust

Question 5

Can informal words or actions show certainty of intention?

Answer 5

Yes, as there is no need for the word trust to show intention.

Question 6

What happens to the property is a certainty of intention is lacking?

Answer 6

The proeprty will pass as a gift to the intended trustee.

Question 7

What does the certainty of subject matter mean?

Answer 7

The property to be held on trust must be clearly identified.

Question 8

Will subjective phrases create a trust? Eg ‘the bulk of my estate’?

Answer 8

No as subjective phrases will not create a trust

Question 9

Are fractional shares of intangiable assets valid? Eg 70% of my shares in tesla?

Answer 9

Yes fractional shares of intangiable assets are valid

Question 10

Are fractional shares of tangible assets valid? Eg 20 bottles of wine in a warehouse

Answer 10

No, will fail

Question 11

When can fractuional shares of tangible assets be valid?

Answer 11

When seperated from the whole of the tangible assets. Eg the 20 bottles of wine were selected and seperated from the rest would be valid.

Question 12

What happens when a trust lacks certainty of subject matter?

Answer 12

The property reverts back to the settlor.

Question 13

Define certainty of objects?

Answer 13

The beneficieries must be clearly identified

Question 14

2 ways beneficieries can be identified?

Answer 14

1, by their names
2. Reference to a concept defining a class of beneficiaries eg my nephews will be valid but not my friends as uncertain and subjective

Question 15

For fixed trusts what test do we use for certainty of objects?

Answer 15

The complete list test

Question 16

What is the complete list test?

Answer 16

The trustees must be able to give a complete list of the beneficiaries. If they are potential beneficiaries who the trustees are not certain of or they cannot make a full list, the trust is void for uncertainty.

Question 17

For certainty of objects do the beneficiaries have to be in existence?

Answer 17

No, as unborn beneficiaries will be deemed certain if they are ascertainable.

Question 18

For certainty of objects, if a group of beneficiaries are described and not named, what evidence is required for this to be valid?

Answer 18

Conceptual and evidential certainty. Eg a trust for tesla employees in equal shares will be conceptually certain but if there are no records of past employees then it will lack evidential certainty.

Question 19

For discretionary trusts, what test do we use for certainty of objects?

Answer 19

The given postulent test.

Question 20

What is the given postulent test?

Answer 20

Trustees must be able to say with certainty when a potential beneficiary comes before them, that he is either is or is not a beneificary.

Question 21

Will discretionary trusts fail for evidential uncertainty?

Answer 21

No, as discretionary trusts will not fail for uncertainty

Question 22

What is admininstrative unworkability?

Answer 22

Arises when trustees are not able to carry out the settlor’s intentions eg where the size of the class is too large.
A discretionary trust failed as was for all inhabitants of west yorkshire which included 2.5 million.

Question 23

What happens if a trust lacks certainty of objects?

Answer 23

A resulting trust is presumed in favour of the settlor or the settlor’s successors in title

Question 24

What happens to a trust if a trustee dies,refuses to accept appointment or resigns?

Answer 24

The trust will not fail and the court will simply appoint a successor trustee

Question 25

What are the qualifications for a trustee

Answer 25

1. Must be 18 and have mental capacity. Can be an individual, professional trustee or a trust corporation.

Question 26

What are the number of trustees required?

Answer 26

No minimum or maximum number required.
Must act in unanimity so best not to appoint too many trustees as could lead to issues.

Question 27

Required number of trustees for trusts of land?

Answer 27

Must have at least 2 trustees and not more than 4 trustees.

Question 28

What is the rule against perpetuity?

Answer 28

Stops the trust from being effective for overly long periods of time.

Question 29

If there is no perpetuity period then how many years will be assumed?

Answer 29

21 years

Question 30

How long does for as long as the law allows mean in years

Answer 30

Means 21 years.

Question 31

The perpetuity period for trusts created after april 2010?

Answer 31

125 years

Question 32

The perpetuity period for a valid non charitable purpose trust

Answer 32

A human life in being plus 21 years.