Equities - Constitution Flashcards
Milroy v Lord
Shares not transferred by appropriate form - Despite clear intention to transfer shares, shares hadn’t vested
Judgement involved three important issues:
- Methods appropriate to transferring different types of property
- Different methods of conferring benefit on another
- Equity will not perfect an imperfect gift.
Jones v Lock
Imperfect gift to baby was not a trust
A failed gift cannot be considered a declaration of trust
Richards v Delbridge
Grandfather attempted to transfer lease
Endorsement of a lease does not transfer legal title.
Where the donor has failed to use correct method of transferring ownership, the gift will fail. (court won’t save an imperfect gift).
Paul v Constance
Effective declaration of trust due to sufficient proof of intention.
Generally no formalities for personal property in life trusts
Shah v Shah
Letter referring to transfer of shares was a gift but the constitution formalities had not been fulfilled. Gift failed but it was considered a declaration of trust.
Choithram v Lalibai
Exceptions to formalities
D declared intention to make a gift on trust to a charity; did not however transfer legal title before he died. Gift upheld because donor was a trustee himself so, as one of the trustees already had legal title, all of the trustees were entitled to have that property vested in them jointly.
S/D had done everything in their power to constitute.
Re Rose
Exceptions to formalities
Share certificates given to transferees but directors did not register the transfer until three months later. Held that although legal title did not pass until registration, transfer effective in equity once Mr Rose had done everything in his power to vest the shares. Pending registration, settlor held legal title to shares on constructive trust for transferees.
Where donor has failed to transfer legal title, transfer may be regarded as complete in equity if donor has put the property beyond his recall.
Mascall v Mascall
Exceptions to formalities
Donor handed over deed of transfer to donee but later changed his mind. Held that property belonged to donee despite lack of registration.
If donee needs to get an order from a court of equity in order to complete his title, he will not get it; if he has under his control everything he needs to constitute his title completely without further assistance from the donor, donee needs no assistance from equity and the gift is complete.
Pennington v Waine
Aunt, Nephew, transfer of shares, aunt died before formalities completed.
Where the intention is to make an immediate gift and it would have been unconscionable for the donor to recall the gift, it will be considered complete in equity.
Strong v Bird
Money borrowed from stepmother - paid reduced rent - gift.
Where the following four conditions are met, upon death of the intended donor the gift will become a perfect gift and the donee can claim the property in priority to those entitled to the rest of the estate:
1) The donor intends to make an immediate gift to the donee, but the gift is invalid because he fails to comply with the appropriate formality for transferring the legal title.
2) The intention must be to make an immediate gift, not one in the future (Re Freeland).
3) The intention must continue unchanged until the donor’s death and there is evidence of this;
4) The donor dies, and the donee is appointed the donor’s executor or administrator (the donor’s representative).
DMC: Cain v Moon
A gift made in contemplation of immediate death can be perfected despite not having followed formalities for lifetime gifts or drafting of a will.
STA 1963
Formalities of a stock transfer:
1) Complete and sign stock transfer form
2) Send STF and share certificate to transferee
3) Transferee must send documents to company to register new owner.
Formalities for transfer of chattels:
Simply physical delivery (Re Cole)
or by deed (Jaffa v Taylor)
