EXAM NOTES - Purpose Trusts Flashcards

1
Q

general structure

A
  1. charitable trust?
  2. general rule: Morice v Bishop of Durham
  3. Re Endacott exceptions
  4. perpetuity rules
  5. willing trustee?
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2
Q

define a purpose trust

A
  • A trust to carry out a non-charitable purpose rather than to benefit an individual or individuals
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3
Q

what is the general rule about purpose trusts?

A

Morice v Bishop of Durham

  • Non-charitable purpose trusts are void for offending the beneficiary principle
  • Also often fail due to perpetuity or uncertainty reasons
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4
Q

what is the exception to the general rule about purpose trusts

A

Re Endacott
o Erection and maintenance of monuments and graves Mussett v Bingle
o Saying of private masses Bourne v Keane – public masses are charitable Re Hetherington
o Maintenance of particular animals Pettingall v Pettingall; Re Dean
o Miscellaneous Re Thomson

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5
Q

what is the limitation to the Endacott exemptions?

A

Re Thompson – these exemptions are valid but unenforceable; trustees cannot be made to carry them out

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6
Q

show how certainty is still needed for purpose trusts

A

e.g. which animal in question; Pettinghall v Pettinghall “my favourite black mare” - clear enough?

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7
Q

How do perpetuity rules affect Re Endacott?

A
  • Rule against inalienability – property can only be tied up for non-charitable purposes for the duration of a life + 21 years
  • Only way to make a valid Re Endacott trust is for the creator to include a perpetuity period – either by linking to a life in being + 21 years or stating “so long as the trustees can legally do so” Re Hooper – this = 21 years
  • Re Kelly: an animal’s life cannot be a “life in being” so a valid period should be stated
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8
Q

explain the general rules about erecting monuments

A
  • Unlikely to be charitable unless it is of someone of national importance and may then be covered by the Charities Act 2006 if for ‘public benefit’
  • Otherwise is an Endacott exemption Mussett v Bingle; Re Hooper
    o But a “memorial” could be too uncertain to count as an Endacott monument
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9
Q

how do perpetuity periods affect the erection of monuments?

A
  • If nothing about maintenance then no perpetuity problem; just paying for construction and we can assume that will happen within 21 years Mussett v Bingle
  • Maintenance of anything that is part of/attached to a church is counted as charitable Re Hooper; if something’s of benefit to a whole church, it will also charitable Re Douglas
  • Maintenance of anything else requires a perpetuity period
  • If part of a gift works and part fails, you can sever if there are two separate funds of money but otherwise all fails and must return to the estate
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