Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Trusts > Express Trusts > Flashcards

Express Trusts Flashcards

1
Q

How to create a trust

A

Declare yourself a trustee or transfer property to trustee on trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What kind of property can be trust property

A

Anything capable of being owned can be trust property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

When is a trust constituted and enforceable

A

Once property is transferred to trustee

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Can a settlor create a trust if they only have an equitable interest

A

Yes can still assign it so interest is held on trust not property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is T becomes bankrupt

A

B can claim trust property in advance of creditors

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Who enforces public trusts

A

Att-Gen

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

How long is Perpetuity rule

A

125 years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What happens when perpetuity rule breached

A

Trust instrument must provide for it to vest within the period or trust becomes void

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Rule against accumulations

A

No long Applies

For trusts created pre 2010 the trust cannot be accumulated for more than 21 years or the minority of a person in being

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Bona fide purchaser for value without notice

A

Takes free of equitable interests
Equity’s darling.
Bona fide= good faith

Unless purchaser has notice or ought reasonably to have acquired notice of the equitable interest

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

How to assign an equitable interest

A

Signed writing
Declare you hold it for another (sub trust)
Or
Declare T holds it for another

Must be whole of interest not part of it

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Formalities for a trust of personal property

A

No formalities required just need capacity and intention to create a trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Formalities for trust in a will

A

Wills Acts s9 - writing, signed witnessed

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Trust for land formalities

A

Writing and signed
Doesn’t need to be a deed
Also transfer legal title under LPA s52

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Formalities for trust of copy write

A

Writing

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Formalities for transfer of shares

A

Form of transfer and stock transfer form

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Knight v Knight 3 certainties

A

subject, object and intention

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Certainty of intention

A

Intention to create a trust must be clear
consider all circumstances, whole trust and can imply from behaviour
imperative words - trust
hope / wish - not a trust, a gift.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What if there is no certainty of intention

A

Take absolutely as gift

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Certainty of subject matter

A

Property must be easily identifiable
cannot be part of bulk unless shares.
evidential uncertainty won’t cause it to fail (cannot locate it)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What if there is no certainty of subject matter

A

trust is void

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

certainty of objects

A 
clear who are the Bs. 
Fixed trusts - class ascertainability test (IRC v Broadway) - T must be able to draw up a complete list of Bs. 
Discretionary trusts - individual ascertainability test (Mcphail v Doulton) - T must be able to say if any one person falls within the class. Need conceptual certainty and administrative workability or will fail.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Conceptual certainty

A

clearly defined

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

administrative workability

A

not too wide a class so that it would be practically impossible to establish Bs.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
What if there is no certainty of objects
Goes back to S on RT or if S has died the residuary B of the will.
26
S tries to create trust but it goes wrong and then S dies with no will. What happens to the property
It passes under intestate rules
27
What property can S create a trust over
Property S owns or has an equitable interest in. Not future interest
28
Where there is a collection of things can S create a trust over just some of the group
Only if they are all identical. Eg intangible property Otherwise it lacks certainty of subject matter
29
If S transfers property to T, some of which is for T absolutely and some of which is for T to hold on trust but there is no certainty of subject matter what happens?
T will take it all absolutely
30
If S transfers property to T all of which is to be held on trust but there is no certainty of subject matter what happens to the property
It is held by T on RT for S
31
What are predatory words
These express a hope of expectation and indicate a gift
32
What sort of words are needed for certainty of intention
Mandatory or obligatory
33
What are the 2 aspects of certainty of subject matter
The trust property must be described with certainty | The settlor must define the Bs interest with certainty
34
What is the rule against perpetuities called when dealing with trusts for individuals
Rule against remoteness
35
What is the rule against remoteness
To be valid the trust must vest ( become unconditional ) within perpetuity period (125 years of created after April 2010)
36
What are the 2 steps to make a trust
Declaration | Constitution (transfer)
37
How to constitute a trust if S is also the T
Self constitute so no need to transfer the property
38
How to constitute a trust of chattels or money
Title passes on delivery
39
How to constitute a trust of land
Signed and written | If registered land use deed TR1 and give it to T to send to land registry (or send directly)
40
How to constitute a trust of shares
CREST system if public quoted shares | Or for all other shares complete share transfer form and certificate to T then to company ( or to company directly)
41
Can S be forced to constitute a trust
No- equity won’t assist a volunteer Unless S did everything they could to transfer it but 3rd party didn’t complete it If S is to be joint T with a 3rd party it would be unconscionable not to transfer it so S cannot back out and must constitute it
42
Difference between administrator and executor
Executor - will | Administrator - no will
43
How do administrators and executors get legal title
Through grant of representation
44
Capital return
Value of property
45
Capital gains
When the value of the item goes up
46
Income return
Money (or monetary equivalent) received on a regular basis deriving from property
47
Rule in strong v bird
If S wanted to create a trust with T as trustee but died before they could constitute it and T is also executor or administrator this will create trust if Ss intention lasted until their death
48
Test for certainty of objects for fixed trusts
Complete list of Bs Evidential certainty Conceptual certainty
49
Test for certainty of objects for discretionary trust
``` Given postulant test Can it be said with certainty that any given individual is or isn’t in the class Conceptual certainty Administrative workability Cannot be Capricious ```
50
What is capricious
No logical basis on which T can distribute property
51
What is conceptual certainty
Is the description of the class clear and objective
52
What is evidential certainty
Do we have the evidence to identify all the Bs that will benefit under the trust
53
Is capriciousness an issue for fixed trusts
No
54
Is evidential certainty an issue for discretionary trusts
No
55
What if there is no certainty of objects, no administrative workability or it is capricious
There will be a RT in favour of S
56
Beneficiary principle
To be valid a trust must be for the benefit of individuals
57
Vested interest
B exists and doesn’t have to satisfy any conditions. Their interest is unconditional
58
Contingent interest
Conditional on a future event that may not happen or B is not yet in existence
59
What happens to a contingent interest when B satisfies the condition
It becomes a vested interest
60
If B dies before satisfying the conditions of a contingent trust what happens to the property
It goes back to S unless there is a substitution clause
61
What is a substitution clause
Identifies who will take the property in substitution should the primary trust fail
62
Do Bs under a discretionary trust have a beneficial interest
They have no beneficial entitlement until T exercises discretion to distribute. Until then they are objects not Bs Once T decides to distribute they get a vested interest
63
Saunders v Vautier
``` B can end trust, having it transferred to B or to other Ts if: All Bs are in existence and ascertained All 18+ All agree And All absolutely entitled between them ```
64
What if B dies before the property in a vested trust is transferred to them
The property belongs to Bs estate
65
What if the B of a vested trust is under 18
T will hold the property on trust until B is 18
66
What if the B of a vested trust dies before they reach 18
The property will form part of their estate
67
What if the B of a vested trust is over 18
T holds it on bare trust until transferred
68
What type of interest does the remainderman have
A vested interest because it is not conditional (death inevitable) even though they cannot have it till life tenant dies. Vested interest is postponed
69
What if remainderman dies before life tenant
It would not fail but would be transferred to estate of remainderman after death of life tenant
70
What type of interest does a life tenant have
Life interest
71
Can a remainderman’s interest be conditional
Yes it would be a successive interest trust
72
What is a successive interest trust
When a remainderman has a contingent interest
73
Other name for successive interest trust
Life interest trust
74
Bare trust
Trust for a sole adult, mentally capable with a vested interest. B is absolutely entitled
75
What does a T of a bare trust have to do
Must handle property as B dictates | B can end trust at any time or replace Ts
76
Beneficiary principle
Need a B to enforce the trust
77
Which trusts are void due to violating the beneficiary principle
Non charitable purpose trusts
78
How long is the perpetuity period (rule against inalienability of trust capital) for non charitable purpose trusts
21 years
79
What is the perpetuity period called when dealing with non charitable purpose trusts
Rule against inalienability of trust capital
80
Which rules are charitable trusts exempt from
Beneficiary principle and rule against inalienability of trust capital
81
When are non charitable purpose trusts NOT in violation of the rule against inalienability of trust capital
The trust states it is to last no more than 21 years (as long as the law allows will suffice) Or T may spend all the trust capital on the purposes thereby ending the trust at any time (suffices if nothing puts limit on when it can be done/spent)
82
3 aspects of a charitable trust
Charitable purpose Sufficient public benefit Exclusively charitable
83
What are trusts of imperfect obligation
Trusts to care for animals, maintain graves and tombs.
84
Do trusts of imperfect obligation breach the beneficiary principle
No because if T doesn’t apply the money for purpose S or residue B can go to court to claim the money for themselves
85
Do trusts of imperfect obligations need to comply with the rule against inalienability of trust capital
Yes
86
What is an Re Denely Trust
Identified people who will benefit from purpose and they have standing to enforce Ts duties so court can enforce trust
87
Requirements for a valid re Denley trust
The purpose of the trust is sufficiently clear and gives rise to a sufficiently tangible benefit The persons who will benefit from purpose must be ascertainable ( given postulant test so must be conceptually certain) And Must comply with rule against inalienability of trust capital (21 years or any time)

Trusts (10 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions