BPP GDL Study Notes: Chapter 2 Flashcards
How does a trust seperate ownership?
legal ownership to trustees
beneficial or equitable ownership to beneficiaries
What interests subsist in a trust fund?
- legal estate in the trustees
2. equitable interest in beneficiaries
What are express private trusts?
- deliberately created by settlor
- for the benefit of individuals
- usually used for the protection and preservation of wealth
What are charitable trusts?
- public trusts
- exist to promote a purpose
What are implied trusts?
- trusts that are imposed by the law in certain circumstances
- can come into being regardless of the intentionsof the settlor
How is a trust ‘express’?
if it is deliberately set up by the settlor or implied by his conduct
What is a ‘resulting’ trust?
- the property results or returns to the owner
- might be because the settlor didn’t dispose of it fully or from some other mistake
What is a ‘constructive’ trust?
- trust imposed by law in a number of situations
- used to remedy a fault or facilitate a transaction
- eg if A and B enter into a specifically enforceable contract they create a constructive trust
What is a ‘statutory’ trust? Give an example.
- trust implied by statute
- eg the trusts that are formed on an intestacy which are governed by the Administration of Estates Act 1925, as anmended by the Trusts of Land and Appointment of Trustees Act 1996
What is a ‘bare’ trust?
-where the beneficiary (or all the beneficiaries) are sui juris
AND
-the beneficiary (or all the beneficiaries) are absolutely entitled to the trust property
they may call for the trust property to be transfered to them under Saunders v Vaughtier 1841
How is a trust ‘fixed’?
if the settlor has determined who the beneficiaries are and how much they will receive (ie the beneficial interests which each beneficiary will take)
What is a ‘vested’ interest?
one that is unconditional and therefore exists immediately. Eg to T on trust for A for life remainder B absolutely. A has a vested life interest and B’s interest is “vested in interest”
How else can a vested life interest be referred to?
the holder is “vested in possession”
What is a ‘contingent’ interest?
an interest that is subject to the fulfilment of a condition which may or may not be met. eg “in remainder to B if he survives A”
What is a discretionary trust?
- eg “to T on trust for such of my descendants as he shall select”
- one where the trustees have the discretion to decide a)whether to pay the income out b) to whom