Equity and trusts - 3 certainties Flashcards

Question

What is certainty of intention a question of?

Answer 1

It’s a q of construction

Answer 2

2 elements in regards to this

Answer 3

It must be clear what prop is held on trust e.g account / shares - so trust can bite - beneficial interests must be clear If not certain or clear trust will fail

Answer 4

If not clear / trust = void as trustees beneficiaries . Ct won’t be able to determine what is held on trust

Answer 5

This arises where attempt to create a trust over part of a bulk of tangible property

Answer 6

E.g furniture in a house or warehouse filled with desktop computers . Where there’s is a trust ofpart of bulk of tangible prop, trust prop will only be certain if separated from trust

Answer 7

``` Palmer v simmonds- the bulk of Peck c Halsey - some of the best .. Anthony v dodges Jubber v jubber Re kolbs wt ```

Answer 8

Re London wine co was uncertain - wine paid for not segregated = unidentifiable

Answer 9

Hunter v miss - didn’t specifically say which 50 shares trust was upheld - on ground that shares were intangible assets - but could disntiguuish shares = controversial case -

Answer 10

Endorsed in re Harvard securities Ltd

Answer 11

Physical seg and intangible like shares which didn’t need seg, trust could arise- loads of people never liked bc said lacked logic

Answer 12

Sales of gooddd ammendant act 1995 , context of sales - reverse dec in the London to allow prio sellers other creditors look back st this

Answer 13

You can have a gift of residue

Answer 14

S.20 soga 1979 - offers protection to purchases of an unseg part of larger bulk of prop - ass soon as they have paid, purchasers will be considered tenants in common or the whole prop. Has the effect of protecting their purchases from creditors in the ever of liquidation / receivership m Hw where there is a trust of part of some intangible prop, e.g shares = no need to identify shares to be held on trust

Answer 15

Hunter v moss - applies to trusts part of a large whole Pg- look at facts e.g if portion of shares and diff types of them or relate to shares diff companies = hunger = not apply and trust will be void if not further identification of rel property Re Harvard securities Ltd in liquidation

Answer 16

Despite fact hunter v miss followed in re Harvard securities Ltd & more recently complex finiancial securites in Pearson v Leahman brothers finance = criticisms

Answer 17

Hayton in 1994 110 LQR 335- no of arg

Answer 18

Beneficial interest must be clear

Answer 19

Boyce v Boyce - father trust 1 sis.1 due 4 houses - prop clearly identified but Benedict no - trust would have worked if trustees were to choose, but neither trustees or ct could determine Ben

Answer 20

Strange v Bernard - held uncertain

Answer 21

Re golay wt - q was whether instructions given were certain enough to slow them to carry out terms of the trust - reasonable income 2 names Ben = valid as make was in maintenance cases

Answer 22

Legal issues surrounding out of Ben int. Will not apply to discretionary trust- bc extent to which can benefit if not all is absolute discretionary of trustees

Answer 23

If lack of cert as to subject matter this will cast doubt on whether settlor truly intended to create trust - mussoriee bank Ltd v ray ore & effect if lack of mast = trust fails and pop will return to settlor / estate on r. T

Answer 24

This is third requirement - cert of object relates to who are the beneficiaries of trust ? - is every trust not cpt must satisfy this req Different for fixed and discretionary

Answer 25

Actual Ben of objects of trust vs purpose trusts - cert of purpose, purpose being object of trust

Answer 26

Object of trust usually Ben

Answer 27

Cpt, ppt look at conveyancer - .. no eq title and no benefitiancy

Answer 28

Beneficial int are fixed

Answer 29

E.g trust to Benefit razia and stanhan in equal shares

Answer 30

Full list of Ben must be able to be created IRC v broadway cottages trust - all Ben must be able to be indentified

Answer 31

1 conceptual certainty 2 evidential certainty 3 administrative workability

Answer 32

Class of Ben need to be certain e.v tall = uncertain trust fails and money then on r. T residuals legatees. - equity abhors a vacuum- can go to settlor or testator trix but they’re dead so resid lega - plug the gap - a . R . T

Answer 33

I.e int are fixed = equal shares _poss to list all ben form which equal div can be calculate The lIST TEST

Answer 34

IRC v broadway cottages / re gulbenkian | List test - trust and equal shares - don’t always need to find them but you can calculate

Answer 35

Class of Ben must not be to numerous as to render it impossible for trustees to properly administer the trust - r v district ex p west York shire cc Not valid trust be trus be discreet trust can distribute to whoever = too big for trustees to manage trust Trust fail r. T to settlor local auth back 2 gov - load if too wide e.g lord wilberforces e.g of trust all residents in greater loosen.

Answer 36

Type of trust trustees given power to apparent people as Ben. There’s a class of potential beneficiaries do not hold ben until trustee excercise discretion of trustees

Answer 37

Must be clear have to work it out and admin workability not so bit but workable - but no list test with discr

Answer 38

A diff approach taken in respect if discretion trust where there is key dec

Answer 39

Mcphail v doulton

Answer 40

Opposed list test and replaced with never flexible concept cert - some test as valid power of appointment

Answer 41

Same as fid duty - re gulbenkian settlement - where her it could be said with crt that any given unification is or is not memeber if the class

Answer 42

Cc- is or is not test - in mcphail not too vague

Answer 43

It was challenged in re Baden no. 2

Answer 44

Look whether valid dt had to consider this test in cert of objects - did relatives and dependnars conceptually certain - they embraced is or is not test - stamp oh = strict interp

Answer 45

Said test would be satisfied if certain fell within that case - real and dependent = cc Does not matter whereabouts \continued existence of a ben is not known

Answer 46

Re shields wt Re Barlow wt Re daulton wt

Answer 47

Described as linguistic or semantic certain A class of Ben will be cc when descriptions enable group to be clearly defined 1 st eg brithsh army - morally upstanding no cos where can line be drawn

Answer 48

Do not require same degree of cc as d t

Answer 49

One to which donee will not be entitled unless he or she satisfies the condition e. G 10000 to each my children who grad uni

Answer 50

Paintings case In a gift to class objects only entitled to share of the prop - vital is or is not - hw in this case from and friends given individual opp to purchase paintings = greater degree of uncertainty to whibsatified ndbdid affect app they really - come back

Answer 51

Gift 2 friends = valid as gift to cond preced- discretiojtrusts for friends = void as imposs to define friends socould he said any India’s is or is not class

Answer 52

Important 2 disting Cc = cert of class Evidential c - whether not individ can be found or progeny If class c uncertain- trust void - but evil link will not defeat trust Important refer re Baden although agreed cc depth all 3 judges for diff reasoning

Answer 53

- Sachs lj liberal approach - Megaws lj middle ground - stamp lj strict approach

Answer 54

The issue cert obj for dt= complex - own detailed notes on mcphail v doulton re Baden and then deepen understanding of this reading Emery’s discussion of this issue

Answer 55

Debate whether concept uncertain can be cured by Reference to the definition of the trustees or a third party where trust would fail for conceptual uncertainty

Answer 56

Resolve by build into terms of gift on trust the language/ machinery to resolve any conceptual uncertainty So where trust would fail for concept uncert - to said that could say tall means / we could moraine a 3 rd party trustee or someone else- 3 rd party mooned to resolve an 3rd part uncertainty

Answer 57

The third part could be an independent person

Answer 58

Argued that reference to trustees or 3 rd party opinion may be concep uncert.

Answer 59

The narrower ground that there was no concept uncertainty bc the settlor was in effect saying that his dc of Jewish faith is sams as a concep cert class

Answer 60

Address the validity of conditions precedent it remains unclear whether

Answer 61

1. Same approach would be adopted in respect of a dt with concept uncertain 2. Whether the CT’s would adopt the broad approach of denning lj or re more restrictive appraoch Evelin lj

Answer 62

Problematic . Whereas denning lj appraoch would ensure the valid if many more dt, it would also seem to empower individ named by the settlor to are concept uncert in circumstances where the cr would otherwise declare the trust void.

Answer 63

Maintain the need for c.c but rests n a very fine factual district that many settlers will not appreciate 2.eg

Answer 64

``` Re Coxen Re Jones Re leek Re Wright’s wt Re Coates ```

Answer 65

Trust which lacks cert of objects will be void and return on r. T to the settlor his or her estate

Answer 66

As you have seen following mcphail v doulton the test for certainty of once’s for the d.t and did powers is now the same . Hw it is important to remember that there are still important differences

Answer 67

``` Mcphail v doulton establishes that trustees have following duties to - surge the field to identify the width of class and to To distribute income from the trust ```

Answer 68

Watch for no exhaustive d.t which expressly allow the trustees to accumulate income- in such the trustees may delay distributing for some time but must still ultimately distribute at some point

Answer 69

The donee of a fid power is not under a duty to distribute the property. He re Hays st fid have following duties

Answer 70

To consider periodically whether to excericse the power To consider the range of possible objects To consider the appropriateness of appointment made ie they cannot pick at random/ without reason

Answer 71

If an arrangement refers to a gift over in default or a distinction that remaining money is to return to settlors estate this will be a fid power as the wording demonstrates that there is not a dirt to distribute

Answer 72

D.t Members of the class are not beneficiaries until they have been appointed to the trust until that time they merely hold a type of hope of beneficitting this means that menebers of the class may challenge the dec of the trustees but cannot claim that they are entitled to be allonfion as this at the abolsite discretion of trustees

Answer 73

``` Appointed outside the class Failed to consider their reasons for along Acted in bad faith in making an appointment eg appojting slinky to close friends within the class ```

Answer 74

If all ben are a sui juris they may act together to wind up the trust under the rule - Saunders v vautier as there an the entire beneficial trust

Answer 75

As with dt embers of a class under fid power cannot claim to be entitled to be appointed hw dec may be challenge on basis that fid have ``` Appointed outseide class Failed to carry out their fid obligations re Hays st ```

Answer 76

Unlike dt the dt will not intervene to compel the fid to excercise their power - furthermore the objects of fid power cannot take adavanrge if the rule in Saunders v vautier as the beneficial int lies with the person entitled to the gift other in default of the appointment