Beneficial entitlement and purpose trust Flashcards
What is a fixed interest trust?
The settlor has stipulated upfront who will get what. The interests of beneficiaries under a fixed interest trust are fixed by the settlor.
What does it mean to have a vested interest?
The beneficiary exists and does not have to satisfy
any conditions before becoming entitled to trust property. If they die before the trust property is paid, the trust property will belong to the beneficiary’s estate
What is a bare trust?
A trust in which the beneficiary has a right to both income and capital and may call for both to be remitted into their own name.
what is a contingent interest?
if the interest is conditional upon the happening of some
future event that may not happen, or if the beneficiary is not yet in existence
What is a successive/ life interest trust?
used to distribute property over successive generations (remainder trust)
Discretionary trust
the settlor typically identifies the class of people they would like to benefit but leaves it up to the
trustees to decide who amongst that class will in fact benefit and in what amount.
What is the rule in Saunders v Vautier
A sole, adult beneficiary with a vested beneficial interest can require that trust property be conveyed to them by the trustees, thereby bringing the trust to an end.
For multiple beneficiaries, they can bring a trust to an end as long as they all:
- are in existence and ascertained;
- are aged 18 years or over and have mental capacity; and
- agree to what is being proposed.
