5. Resulting Trusts

Question 1

Does a voluntary transfer of personalty give rise to the presumption of resulting trust? Can this be rebutted

Answer 1

1. Yes
2. Can be rebutted by evidence of the intention to the contrary (eg. gift for a birthday)

Question 2

Does a voluntary transfer of land give rise to the presumption of resulting trust?

Answer 2

Only if there are strange circumstances (eg. the transferor and transferee are strangers)

Question 3

Purchase Money Cases

Answer 3

Where X purchases property from seller and puts it in the name of Y, Y is the legal owner BUT there is a presumption they hold the property on resulting trust for X
- Applies to property as well for part contributions to purchase price

Question 4

When will a contribution to the purchase price of land / personalty give rise to the presumption of resulting trust?

Answer 4

If the contribution is
a. occurring before / when the purchase is made
b. directed towards purchase price ITSELF (not ancillary fees such as lawyer’s fees)

Question 5

In what relationships does the presumption of advancement arise?

Answer 5

1. Father to child (minor or adult)
2. Person ‘in loco parentis’ to child (person who provides financially for the child whilst a minor)
3. By husband to wife
4. by fiance to fiancee (so long as the couple subsequently marry)

Question 6

What evidence is required to REBUT the presumption of resulting trust?

Answer 6

1. Evidence of transferor’s intention before or at the time of transfer

Question 7

Automatic Resulting Trusts

Answer 7

This occurs when property is transferred with the intention of an express trust being created but something goes wrong and trust is not created (either is void or does not exhaust beneficial interest)
- resulting trust implied in favour of the settlor

Question 8

When might a trust (which is valid) NOT dispose of the equitable interest

Answer 8

1. Gap in beneficial ownership because there is no beneficiary who gets a vested interest
2. Trust lacks certainty of objects
3. Trust lacks certainty of beneficial interests
4. Trust offends rules against perpetuity
5. Trust offends the beneficiary principle

Question 9

Formalities required to create a resulting trust?

Answer 9

None, as it is implied