Definition And Classification Flashcards
What is Professor Keaton definition of trust?
A trust is a relationship which arises wherever a person called the trustee is compelled in Equity to hold property whether real or personal, and whether by legal or equitable title for the benefit of some persons (of whom he may be one and who are termed cestuis que trust ) or for some object permitted by law, in such a way that the real benefit of the property accrues , not to the trustee, but to the beneficiaries or other object of the trust.
What is the main characteristics of a trust
The property is vested in the trustees not for their own benefit , but for the benefit of the beneficiaries
What should the trustee do?
Safeguard the property and apply it in the manner directed but also make it productive
In case f land what will the trustee do to the land?
Money?
Let it
Invest it in shares and securities
TRUST AND BAILMENT
When does bailment arise?
Where a chattel owners by A by A is with A’s permission placed in the temporary possession of B
Bailment and trust is recognized by which statute respectively?
Common law and equity respectively
What are the duties in comparison with Trust?
The duties of a Bailee is minimal compared to that of a trustee
What property can chattel be used in bailment and trust?
Chattels only for bailment
Any property can be used fir trust
Who is the trustee and bailie to the property?
Trustee is generally the legal owner of the trust property and the general property is vested in him
While the Bailee only has only a ‘special property ‘ in the chattel bailed the general property remaining in the bailor
What happens when both both the trustee and Bailee sells the property in their possession?
The trustee selling the trust property can still confer a good title free from the interests of the beneficiaries on a bonafide purchaser without a notice of the trust while a bailee cannot confer a good title
TRUST AND AGENCY
What is the first similarities btw agent and trustee ?
Agent like trustees must act personally in the business of the agency unless circumstances justify the delegation of their duties
What rule applies in both cases
Delegatus non protest delagare
As regards profit made what are the similarities btw an agent and a trustee?
They are both accountable for any profits made by them out of the property or in the execution of their duties
What do both agents and trustee owe
They owe a fiduciary to their principal and beneficiaries respectively
As regards differences what governs Trust and Agency
Equity and common law respectively
As regards contractual relationship ?
Trustee and beneficiary, there is no contractual relationship btw them while the relationship btw agent and principal is purely contractual
As regards liability
A trustee wouldn’t make a beneficiary liable for his action while it isn’t the case in the principal agent relationship
As regards tracing what is the what is the differences?
A beneficiary can trace against a trustee and this revived money due to the beneficiary which the trustee has mixed with his own money while a principal has no right to trace against his agent so that if the agent has mixed the principal’s money with his own
What will the principal rely on for the amount due
Rely on a personal action against the agent for amount due
Case?
Lister v Stubbs
TRUST AND CONTRACT
What governs them?
Equity and common law respectively
When does a contract arise?
Arises from an agreement on consensus ad idea between the parties
When does trust arise?
Arise from an agreement ( where a settlor covenants with trustees to settle property in the future) but often it will not( where a testator creates a trust by his will , or where a settlor declares himself a trustee of his property for the benefit of volunteer beneficiaries
What is the right to enforce a contract?
A right in personal since generally action can be brought against the other contracting party of parties
What is the right to enforce a trust?
Almost a right in ten , since in the event of a breach of trust, property can be recovered not only from the trustee but also from any other person to whom he has transferred the property, except a bona fide purchaser without notice of the trust
THIRD PARTIES
At common law who could sue?
Only a party to a contract can sue on it
This is due to which doctrine?
Doctrine of privity of contract
What is the general rule
If a contract between A and B intended to confer a benefit to confer a benefit on C, C cannot sue to enforce that benefit
