Constitution

Question 1

Equitable Maxims

Answer 1

• Equity will not perfect an imperfect gift.
• Equity will not assist a volunteer (someone who has not provided consideration).

Question 2

The Settlor as Trustee

Answer 2

Assuming all three certainties and formalities have been met, the trust is properly constituted as the Settlor already holds legal title.

Question 3

Someone else as trustee

Answer 3

The Settlor must transfer legal title for the trust to be properly constituted.

Question 4

Land

Answer 4

All conveyances of land must be made by deed:
- written;
clear on the face of it that it’s a deed;
- signed by the parties; and
- witnessed.

Question 5

Shares

Answer 5

Owner must complete STF, original share certificate cancelled, new one issues and statutory registers updated.

Question 6

Chattels

Answer 6

Physical delivery of the chattel or by deed. Delivery must be unequivocal.

Question 7

Equitable interests

Answer 7

S53(1)(c) LPA 1925.

Question 8

Choses in action

Answer 8

Assigned by given written notice of the assignment to the debtor.

Question 9

Cheques

Answer 9

Provided it is not an “account payee only” cheque it can be transferred by endorsement (signing the back).

Question 10

Covenant to settle (promise to place property on trust)

Answer 10

If not properly constituted then usual maxims apply, except where there is marriage consideration (although can only be enforced by parties to marriage and their issue).

Question 11

Beneficiaries that are party to a covenant

Answer 11

May sue on the covenant at common law for damages but cannot enforce covenant.

Question 12

Actions by trustees

Answer 12

Beneficiaries may not compel the trustees for breach of covenant and the court will direct the trustees not to sue.