beneficiary principle Flashcards
Morice v Bishop of Durham [1804] 9 Ves 399
‘There must be somebody in whose favour the court can decree performance’.
Bowman v Secular Society [1917] AC 406
‘For a trust to be valid, it must be for the benefit of individuals’.
Creating a Valid Will: Witnesses
- Testamentary gifts are only valid if created in a will
- Will must be in writing and signed and acknowledge by the testator and seen by at least 2 witnesses.
- Witnesses must decide the validity of the will (seen in S.9)
No will shall be valid unless
S.9 Wills Act 1837 (as substituted by s.17 Administration of Justice Act 1982)
A. It is in writing, and signed by the testator, or by some other person in his presence and by his direction; and
B. It appears that the testator intended by his signature to give effect to the will; and
C. The signature is made or acknowledged by the testator in the presence of two or more witnesses present at the same time; and
D. Each witness either
i. Attests and signs the will; or
ii. Acknowledges his signature, in the presence of the testator (but not necessarily in the presence of any other witness), but no form of attestation shall be necessary.
Applying the Beneficiary Principle
Re Astor’s Settlement Trusts [1952] Ch 534
A settlement was made by Viscount Astor of all the issued shares of the Observer newspaper. The terms of the trust were that the income was to be applied for the ‘maintenance of good understanding between nations’ and ‘the preservation of the independence and integrity of the newspapers’, purposes which were considered at the time not to be charitable.
Roxburgh J held that the trust was invalid on two grounds: first, that it offended against the beneficiary principle, and second, that the purposes were uncertain.
Applying the Beneficiary Principle
Re Shaw [1957] 1 WLR 729
a gift was left in the will of George Bernard Shaw for the development of a phonetic alphabet, a new language that everyone in the world would be able to understand.
Issue:
Whether the gift would survive or fail.
Held:
The trust was not educational because it merely increased knowledge and did not combine teaching and education. Therefore, the trust was void.
Exceptions to the BP: Charities
S. 3 Charities Act 2011
- Trust that has a charitable purpose do not need to comply beneficiary principle
Exceptions to the BP: Unincorporated Associations
Exceptions to the BP: Charities
Re Denley’s Trust Deed [1969] 1 Ch 373
unincorporated associations
Trustees held land as a sports ground for the use and enjoyment of employees of a particular company for 21 years from the death of the last survivor of a group of named individuals.
If we accept that employees are beneficiaries they would be able to sell the land and split the money between them, which would defeat the purpose of why the land would have been left for the employers for the ground to still be used for sports
Exceptions to the BP: Particular Animals
- Trusts for certain classes of animals and welfare of animals are charitable trust
- Trusts for specific animals is not charitable but may be upheld as an anomalous exception to the beneficiary principle, provided that it does not offend against the perpetuity period.
Exceptions to the BP: Particular Animals
Pettingall v Pettingall [1842] 11 LJ Ch 176
a gift by a testator of £50 per annum for the upkeep of his favourite black mare was upheld.
Exceptions to the BP: Particular Animals
Pettingall v Pettingall [1842] 11 LJ Ch 176
a gift by a testator of £50 per annum for the upkeep of his favourite black mare was upheld. despite not being a charitable purpose and having no human beneficiary.
Exceptions to the BP: Particular Animals
Re Kelly [1932] IR 255
Not interested in average life span of dogs or cats it goes by average life span of human life
Exceptions to the BP: Particular Animals
Re Dean [1889] 41 Ch D 552
William Dean left his eight horses and his hounds to his trustees, and charged his freehold estates with an annuity of £750 per year for fifty years, if they should live that long, to be paid to the trustees for their upkeep. North J held that this was a valid non-charitable trust. However, he seemed to reject the ‘beneficiary principle’ entirely, stating that he did not assent to the view that a trust is not valid if there is no cestui que trust to enforce it. Although Re Dean has been taken as authority for the upholding of trusts for the maintenance of particular animals, the reasoning is incompatible with the beneficiary principle.
Exceptions to the BP: Maintenance of Specific Graves and Monuments
Mitford v Reynolds [1848] 16 Sim 105
a gift for the upkeep of the testator’s horses was upheld.
Exceptions to the BP: Maintenance of Specific Graves and Monuments
Pitbright v Salwey [1896] WN 86
a gift of £800 for the upkeep of the burial enclosure of a child in a churchyard for ‘as long as the law permitted’ was upheld for at least twenty-one years from the testator’s death.
