EXAM NOTES - Certainties, Formalities, Constitution Flashcards
general structure?
for each item of property discuss the owner’s
- title
- intention
- property
- requirements to do what they intend
- the problem
- exceptions to the general rule
what are the three certainties?
Knight v Knight
- intention
- subject matter
- objects
how do you decide certainty of intention
- imperative words not precatory words
- look at the will as a whole and in context
- look to the words and conduct of the parties if necessary eg Paul v Constance “the money in my bank account is as much yours as mine”
what are the rules on certainty of subject matter?
- Sprange v Barnard must be certainty at the outset; cannot create a trust leaving money to X with “what’s left” at their death going to Y. Purported trust grafted onto an outright gift
- Palmer v Simmonds must identify exact property; “the bulk of my estate” is not sufficient
- Re London Wine – a trust of unidentified tangible property will fail
- Hunter v Moss – a trust of unidentified intangible property (here shares) will be valid
- Boyce v Boyce – must be certainty of which beneficiaries get which share. If not, resulting trust
- Re Golay -a “reasonable income” is a valid amount and beneficiary could chose one house out of many
what happens if there is no certainty of subject matter? How can this happen?
- If the property itself is uncertain, no trust
- If the ‘trust’ is really a gift, that’s how it will be treated
- If the beneficial interests are uncertain, resulting trust
- No uncertainty of subject matter if the means for determining it are laid down
what states certainty of objects is necessary?
Morice v Bishop of Durham
How is certainty of objects found?
- Different depending on the type of trust
- Fixed interest trusts – strict ‘list’ test
- Certainty of objects of powers - in/out test
- Discretionary trusts – the in/out test following McPhail v Doulton
what is the list test?
IRC v Broadway Cottages Trust must be possible to draw up a complete list of the beneficiaries
what is the in/out test
Re Gulbunkian’s Settlement Trusts –
o Can it be said with certainty whether any given individual is a member of the class?
o Trust does not fail because it is impossible to ascertain every member of the class
what are the two kinds of certainty?
- Conceptual certainty – precision of language used to define the class of beneficiaries
- Evidential certainty – how well you can prove an individual fits into the class of beneficiaries
is ‘relatives’ a conceptually certain term?
yes Re Baden’s (No 2)
what happens if trust is for a group of people and it fails for some?
you can sever Re Leek and Re Gulbenkian
how does the test apply to gifts subject to condition precedent?
Re Barlow’s WT – test for certainty is less strict
How can legal title to property be transferred?
Milroy v Lord
- Absolute gift
- Transfer to a trust
- Self-declaration of trust by S for B’s benefit
how can equitable interest be transferred?
Timpson v Yerbury
- Assign to third party directly
- Direct trustees to hold on trust for third party
- Contract for valuable consideration to assign the interest
- Self-declaration of himself as trustee for B
how is a transfer of chattels effected?
- Intention to give Glaister v Carlisle
- Delivery Re Cole
how is a transfer of land effected?
- S52(1) LPA 1925 – by deed (s1 LP(MP)A 1989
o Must be by a separate deed – cannot just endorse a conveyance Richards v Delbridge - Disposition of a subsisting equitable interest in land: s53(1)(c) LPA 1925 in writing signed by S or by his agent (who is authorised by S)
- And registration under s27 LRA 2002
how are shares transferred
- Stock Transfer Act 1963 – stock transfer form, give share certificates and registration
how are bills of exchange transferred?
e.g. cheques – endorsement i.e. signing
how is money transferred
through simple delivery
how are subsisting equitable interests transferred?
- not necessarily land
- Signed writing s53(1)(c) LPA 1925
- Grey v IRC - signed writing + disposition is any transfer of interest to another party
how is a trust of land created?
- S53(1)(b) LPA 1925 declaration in writing signed by S
- S53(2) above section (and formality) does not apply to implied, resulting or constructive trust
how is a trust of personalty created?
no formalities
what is the rule in terms of self declaration of trust of an existing equitable interest for the benefit of another
- E.g. B declares himself a trustee for the benefit of X, effectively creating a sub-trust
- If B retains no portion of the trust and retains no active duties in the trust i.e. it is a ‘bare trust’ B will ‘drop out’ of the picture, leaving T as trustee for X as in Grainge v Wilberforce
- Therefore a disposition of B’s interest: must comply with s53(1)(c) LPA 1925 signed writing
- if B has retained active duties (e.g. it’s a discretionary trust) or has declared a trust of only part or his interest he will not have dropped out (Grainge v Wilberforce) and instead will have created a new trust, and will have to follow the appropriate rules
