CFC Flashcards
Structure of an individual disposition
- What type of disposition is it?
- What are the requirements?
- What is the general rule if requirements not complied with?
- Are there any exceptions?
- Will equity perfect or will it fail as disposition?
Milroy v Lord
3 types of disposition;
- Out right gift
- Transfer on trust
- Self declaration of trust
Requirements of a gift?
- Intention
- Transfer of LT
If gift fails requirements what is general rule?
- Milroy v Lord - invalid gift of shares will not be treated as a self declaration trust
- Jones v Lock - Cheque to baby did not fulfill requirements, therefore failed as gift. Equity does not perfect.
- Richards v Delbridge - Invalid lease did not transfer LT not treated as self declaration trust. Wrote on back of lease. Must be a separate lease.
Transfer on trust requirements
- Valid declaration of trust (certainties + formalities)
- Transfer of legal title
What is general rule if transfer on trust is not constituted?
- Equity will not perfect an imperfect gift
- Equity will not assist a volunteer
- Equity will not create a valid self declaration trust out of a failed gift or transfer on trust
Requirements for a self declaration trust
Only needs to be a valid trust ( C + F)
Requirements for a valid transfer of a chattel
Re Cole; intention and delivery
Or a deed of gift
Valid transfer of shares
S1 Stock Transfer Act;
- Stock transfer form
- Sent off with share certificate
- Title passes on registratino
Valid transfer of copyright
S90(3) Copyrigh, Designs and Patent Act
Valid transfer of a bank account
S136 LPA 1925 - signed written notice to debtor
Valid transfer of land
S52(1) LPA 1925;
- Created by deed
- Registered S27 LRA 2002
Glaister-Carlisle v Glaister-Carlisle
- Intention to transfer legal title
- Threw poodle at wife in an argument shouting ‘you keep the bitch’
- Not sufficient intention as in heat of moment
Richards v Delbridge
Trust of land failed for LT not performed by valid deed
Re Rose
Courts will perfect an imperfect gift if;
- Correct method of transfer used
- Do all in one’s power (no further action required)
- Put the method beyond one’s control (irrevocable)
- ** property with donees agent. Out of control.
Mascall v Mascall
Extension to Re Rose. The father gave everything to the son in terms of paperwork and share certificates. The gift was therefore irrevocable and all the son had to do was register. It was beyond the father’s control.
Zeital v Kaye
The deceased owner of an absolute equitable interest in a shareholding had not done everything in his power to transfer the shareholding when he had not handed over the share certificate, although he had handed over a share transfer form signed by the registered shareholder
Pennington v Waine
Extension of rule in Re Rose. Documents not out of the control of the donor as in the possession of her agent. However it was judged to be unconscionable to deny the transfer as ;
Gift given of own free will
Told Harold of the gift
Signed transfer form
Became director on basis of share transfer
**documents not out of her control in a re: rose sense but p v w operates to mean once in your own agents hands and there is nothing more to do then the rule can still apply.
Equitable proprietary estoppel
This is the idea that a transfer will be deemed to be made if it were unconscionable to go back on the assurance. Based on the ‘minimum equity required to do justice’.
Thorer v Major
Proprietary estoppel arises where there is an assurance, reliance and detriment so that it would be unconscionable to go back on the assurance
Curtis v Pulbrook
Suggests that the rule in Pennginton v Waine is best explained by proprietary estoppel as the nephew relied on the assurance to his detriment, so it would have been unconscionable to deny it.
Choithram v Pagarani
A donor orally declared his intention to make a gift on trust to a charity but did not transfer it before he died. The donor was himself one of the charities trustees and because all trustees are entitled to have the trust property vested in them the Privy Council ordered that this happen. It would be unconscionable not to.
Rule in Strong v BIrd
- If donor intends gift but not delivered and the donor dies before delivery, then if the desired donee is also the executor then equity will allow the gift
- Requirements;
- Intention to make and immediate gift
- Intention remains unchanged until death
Re Freedland
Must be an intention to make an immeidate gift not future gift
- judged to be a future intention where continued to drive the car
Re Gonin
Intention remains unchanged until death
- giving a cheque in lieu of the house was seen to be a change intention
Re Stewart
Extended rule in Strong v Bird to gifts
Re James
Extended to adminstrators
Re Ralli
Extended to trusts
Death Bed Gifts - Donatio Mortis Causa
Cain v Moon
- Contemplation of imminent death
- Conditional on death
- Actual or constructive delivery (Senn v Headley)
Re Miller
Death not imminent so not a case for DMC. Was only a chance of death, not given in contemplation of imminent death.
Senn v headley
- If the gift cannot be formally given, then if a means of access is given, e.g. keys then this is constructive delivery
- constructive delivery depending on giving means of dominion and control
Knight v Knight
Established 3 certainties;
- Intention
- Subject matter
- Object
Adams & Kensington
If intention lacking then take property free of trust
Paul v Constance
- Spoken words sufficient for a trust
- Conduct sufficient for trust
Comiskey v Bowring Hanbury
Imperative wording necessary for creation of trust through written wording
Re Adams & Kensington
- Precartory written wording insufficient to demonstrate intention
Palmer v Simmonds
If subject matter of trust is uncertain then will fail as a void disposition
- In this case failed as ‘bul of my estate’ not sufficient for a trust’
Re Golay’s WT
Reasonable income judged to be sufficiently certain subject matter
Re London Wine
Wine not identifiable as not segregated so the property was not identifiable
Hunter v Moss
Share is a chose in action, not a chattel (i.e. not identifiable) did not have to be identifiable as all the shares were the same
Boyce v Boyce
- What share of property is stated in the trust must be certain
- Will stating that 2 daughters would inherit property, however eldest daughter had to choose which property she wanted first. However as eldest daughter did not choose what share of property she wanted, she got nothing as no definite share of property entitled to
Vandervell (effect of lack of certain object)
- Resulting trust
MOrice v Bishop of Durham
Must be a human to enforce the trust
Fixed trust objects
- Property divided so must be possible to identify all beneficiaries - List method - IRC Broadway Cottages
Objects under discretionary trust
Not all beneficiaries need to be identifiable, only need to pass the is/is not test – McPhail and Doulton
COncept must be conceptually certain
Re Baden
3 different interpretations of the McPhail and Doulton list test; o Megaw LJ – As long as there si a substantial number within the class, then it does not matter that there are some people outside the class o Sachs LJ – Onus on claimant to prove he is within the class o Stamp LJ – Need to know exactly who is in, and exactly who is out. If there is any uncertainty then the trust is void. This is the list test again
R v District Auditor ex p West Yorks
Trust will fail for adminstrative unworkability
Re Barlow’s WT
Gift has lower threshold of conceptual certainty
Maitland; Paul v Constance
- Trusts are essentially informal
Formalities for wills
o S9 Wills act 1837
A. Must be in writing and signed by the testator
B. Signature must be made or acknowledged in the presence of two witnesses present at the same time
C. Each witness must attest and sign the will or acknowledge their signature in testator’s presence
Land
o S53(1)(b);
Manifested and proved by signed writing
Without signed writing the trust is unenforceable
o Exception;
Hodgson v Marks (1971)
• Resulting trust in favour of Hodgson as never intended full equitable title to pass
• Meant that S53(1)(b) did not apply, so there was a trust despite the lack of formalities
Disposition of subsisting equitable interest S53(1)(c)
- Signed writing
- Incurs stamp duty
Timpson Executors v Yerbury
4 types of equitable disposition
- Assign to 3rd party
- Direct a trustee to hold property for 3rd party
- Contractor for valuable consideration
- Declare himself a trustee for 3rd party
Grey v IRC
Directed a trustee to hold property for 3rd party instead of yourself
Still must comply with S53 (1)(c)
Vandervell v IRC
Do not have to comply with S53(1)(c) if LT transferred and ET intended to move as well. Oral instruction is sufficient, need no written evidence
Effect of S53(1)(c) non-compliance
trust is void
Neville v Wilson
If equitable interest sold then S53(1)(c) will not apply if the property is unique and therefore has remedy of specific performance as this will create a constructive trust so S53(2) will apply
Declaration of trsut for 3rd party (in relation to S53(1)(c))
- Grainge v Wilberforce - Under a subtrust the previous ET holder no longer has any duties so drops out of trust, therefore S53(1)(c) does not apply
- B. Green - S53(1)(c) should apply as that will mean there is proof of transfer
- Kaye v Zeital - Subtrusts fall outside scope of S53(1)(c)
Re Paradise Motos
S53(1)(c) does not apply as the potential beneficiary never held the asset so could not dispose of it
What will make denial of a disposition unconscionable?
- reliance
- knowledge of disposition
- assurance that no further act is necessary
Re Beaumont
Cheque from the donor to donee not transferable under a DMC
Re mead
Cheque to donor can form subject matter of a trust
Birch v treasury
Delivery of a bank deposit book constitued constructive delivery under a DMC
Re lashmor
If b declares trust for c of b’s equitable interest then s53(1)(c) is not necessary as this is a bare trust and b drops out of picture
- affirmed in Nelson v Greening. Though did not consider alter stove position
What is the mnemonic for the structure of a CFC question?
Turtles -> title Despise -> disposition type Rancid -> disposition requirements Penis -> property type Rather -> property requirements Tasting -> trust validity? Purple -> problem Elephant -> exception Cum -> conclusion
