Express Trusts Flashcards
What are express trusts
trusts that arise where legal title in property is passed from the settlor to the trustee - with the instruction that the trustee is to hold that property for a beneficiary (ies) in accordance with tthe terms expressed by the settlor
What are the three ways in which a gift can be made
- an outright transfer of legal and equitable interest
- a transfer of legal interest to property to a trustee to hold on trust for the beneficiary who holds the equitable interest
- a self-declaraion of trust where the absolute owner transfers the equitable interest to another person but continues to hold the legal interest.
What is the effect of a trust over a voluntary disposition with no value (eg beneficial entitlement under a will)
the court will not give effect to it
Is it possible to assign future properties or expectations to receive property in equity for value
Yes
what are the formalities for the constitution of an express trust in land
Must comply with certain statutory formalities in accordance with the Law of Property Act 1925.
What is needed to declare a valid trust in land
must be manifestrd and provded by some writing signed by some person who is able to declare such trust by his will - Secition 53(1)(b) of the Law of Property Act 1925.
Does the declaration or other written evidence need to be signed by the settlor
Yes
When will an oral declaration of a trust for land be valid?
an oral declaration will be valid if the three certainties are met
but will not be enforceable in court by beneficiaries unless requirement to evidence the declaration in writing is met at a later date.
What is the exception to the requirement that a declaration of trust in land must be evidenced in writing?
In circumstances wherte the statutory instrument is used for fraud, oral evidence may be used in place of writing requirement, based on the maxim ‘equity will not allow a statute to be an instrument of fraud’
What are the formalities for transfer of land
Land must be transferred by deed
- s52 of the Law of Property Act 1925
which estates in land are capable of subsisting/ or being conveyed or created at law
i) an estate in fee simple (freehold)
ii) a lease
what are the main interest or charges in or over land which are capable of subsisting or being conveyed or created at law
i) mortgages ii) easements iii) covenants iv) profits
When is the transfer of land deemed complete?
When it is registered at the Land registry
What are the requirements for a declaration of trust (personal property)
No requirement for written evidence of a trust in the context of a trust
what are the formalities to transfer private company shares
deliver stock transfer form to the company
transfer form must be signed by the transferor and specify the following:
- the particulars of consideration
- the description and number or amount of the securities
- Particulars of the person by whom the transfer is made
-The full name and address of the transferee.
Who is the stock transfer form sent to ?
HMRC
When does the donee become a member of the company?
When their name has been entered in the register of members
What are the formalities for Public Company Shares
formalities for CREST
(central securities depository for markets in the UK)
How does legal and beneficial ownerhsip pass in the context of Public Company Shares
- The beneficial ownership passes as soon as contract for sale is binding
- seller becomes liable to the purchaser for all dividends received
Legal ownershop only passes once the purchaser has been entered onto the register of members of the company
What are the formalities to constitute a trust of money
the transfer of the money into the trust bank account
Formalities for transfer of chattels (tangible)
i) clear , unambigouous and unequivocal intention of the owner to transfer the property to the recipient
ii) it is accompanied by something which constitutes an act of delivery for a change of possession
What is a chose in action?
a personal right enforceable by legal action and not through physical possession of the property (eg contractual rights, a creditors right to have a loan paid back, cheques, money due etc).
Can the entire interest be transferred for choses in action
Yes (s 136 of the Law of Property Act 1925)
What is the special rule for transfer of onwership of cars
car does not need to be registered with DVLA. DVLA will not recognise trustee as a legal owner - for DVLA purposes when a car is transferred to the trustee, they are the outright owner
What are the formalities for transfer of a chose in action
- give express notice in writing , signed by the assignor to the debtor , trustee or other person from whom the assignor would have been entitled to claim such debt or chose in action.
- assignment must be absolute not by way of charge
What are the formalities for transfer of equitable interests?
For equitable interests both in land and personalty
- a beneficiary may transfer their equitable interests to another person by making transfer in writing and signed by the beneficiary (or other authorised person)
-
What maxim applies if the correct formalities for constitution have not been followed
‘equity will not perfect an imperfect gift’ (Milroy v Lord)
What maxim applies to express trusts which are not completely constituted ?
’ equity will not assist a volunteer’
what does ‘equity will not assist a volunteer’ mean
A volunteer has not given any consideration for the benefit they expect to receive, they cannot rely on the law to give rise to a trust where one has not been properly constituted
what is the exception to the maxim equity will not assist a volunteer?
Re Rose -(1949)
What is the Re Rose principle?
in cases where the settlor of the trust has done everything in their power to transfer the trust property
