4. Secret Trusts

Question 1

Wellgrave v Tebbs

Answer 1

Communication of fst must take place before death

Question 2

Re Boyes

Answer 2

Terms of trust, not just its existence, must be communicated to Ts

Question 3

Re Colin Cooper

Answer 3

Property subject to trust must be communicated

Question 4

Re Keen

Answer 4

Terms may be communicated in sealed envelope, provided T knows that it contains terms of a trust

For hst there must be consistency between trust instrument and will + communication of trust cannot take place after execution of will

Question 5

Kasperbauer v Griffith

Answer 5

Secret trust requirements

1. Intention by testator to create trust binding on inheritor
2. Communication of trust to intended trustee
3. Acceptance of trust by trustee

Testator’s statement that wife ‘knows what she has to do’ with the house held to be too vague to create binding legal obligation

Obiter: STs constructive, so s 53(1)(b) formalities not necessary

Question 5

Re Bateman’s WT

Answer 5

Any reference to a future communication would render hst invalid

Question 7

Moss v Cooper

Answer 7

Silence by T may count as acceptance

Reliance by testator includes making the gift in the will or leaving it unrevoked

Question 7

Wills Act 1837, s 9

Answer 7

In writing
Signed
Attested by 2 witnesses

Question 8

Re Stead

Answer 8

Where there are multiple Ts and one is not informed of trust, he will be bound if

1. Trust was communicated to at least one T before/at time will executed
2. Secret trustees are to be joint trustees

Question 10

Re Young

Answer 10

B under secret trust who witnessed will is entitled to benefit from will (debatable decision)

Question 11

Fraud theory

Answer 11

Based on saying that ‘equity will not permit a statute to be used as an instrument of fraud’

Less convincing for hst

Question 12

Dehors the will theory

Answer 12

Blackwell v Blackwell

Secret trusts operate outside the will and are therefore not subject to Wills Act

Applies to hst just as well as to fst

But makes it illogical for hst not to allow communication after date of will

Question 13

Wills Act 1837, s 15

Answer 13

Witness to will cannot benefit under it

But doesn’t apply to secret trusts

Question 14

Ottaway v Norman

Answer 14

T may be obliged to make will in favour of B

Fst of land enforced, though oral - but doesn’t expressly address issue

Question 14

Re Baillie

Answer 14

Hst of land not enforceable without written evidence - but hst not then recognised, so may have failed on other grounds