Express Trusts Flashcards
What are the elements of an express trust?
1) The three certainties; 2) formalities; and a 3) constitution.
What are the three certainties?
1) Intention; 2) subject matter; and 3) object.
What is intention for the purposes of the three certainties?
Did the settlor have the intention to create the trust?
What are the objects possible for express trusts?
1) Beneficiaries; 2) charitable purpose; and 3) private purpose.
Which case illustrates the general rule of the three certainties?
(Knight v Knight).
What are precatory words?
Words of wishing, hoping, and praying.
Do precatory words establish certainty of intention when used alone? Which case illustrates this?
No they do not establish certainty of intention when used alone (Lamb v Eamed).
Does one have to know that they are making a trust in order for intention to be satisfied for express trusts? Which case illustrates this?
No the criteria for a trust just have to be met (Paul v Constance).
What does the certainty of subject matter mean? Which case illustrates its principle?
A trust cannot be created without property to which it can attach (Lehman Brothers v CRC Credit Fund Ltd).
What is the problem of adjectives for the purposes of certainty of objects? Which case illustrates this?
Certain adjectives like ‘best’ in ‘my best painting’ makes trust uncertain hence void (Re Golay’s).
Is there certainty of objects in saying ‘50 out of 250 shares’? Why? Which case illustrates this?
Yes sufficient certainty because all shares are the same (Hunter v Moss).
What is the beneficiary principle? Which case illustrates it?
Every trust needs a beneficiary (Morice v Bishop of Durham).
What is fixed in a fixed trust?
It is the extent of each beneficial interest which is fixed.
What if the fixed trust doesn’t give share numbers for more than one beneficiary? What is the rule then? What does this rule mean?
Equity is equality is the rule. Which means that assets get divided evenly between beneficiaries.
Do we need to know how many beneficiaries there are for a fixed trust? What’s the test called for this? What does the test say?
Yes we do and the test is called the ‘complete list’ test which checks that there is a complete list of beneficiaries.
In a fixed trust, what are the options if some or one of the beneficiaries are missing? Which cases illustrate these?
1) Court authorises trustees to treat beneficiary as if dead, and if he returns he can recover his shares (Re Benjamin); 2) trustees could get insurance for missing beneficiaries (Re Evans).
What is discretionary in a discretionary trust?
The discretion is as to the beneficial interests.
For a discretionary trust for a certain class, what test is applied to see whether certainty of object exists for that trust? What’s the test? Which case illustrates this?
The ‘is or is not test’. Which determines certainty based on whether it can with certainty be said whether any given individual is or is not part of the class mentioned (McPhail v Doulton).
For the purposes of trusts, What is administrative unworkability? Which case illustrates this?
A class too wide to the point that it’s too much for the trustee to carry out.
Could you refer someone else to cure uncertainty of object? Which case illustrates this?
No (Re Wynn).
This case shows that every trust must have a definite object. What’s the exception to this rule?
(Morice v Bishop of Durham). Charitable purpose trusts are the exception to the rule.
Which case and statute illustrate and codify that charitable purpose trusts just need to be exclusively charitable to fulfill the certainty of objects?
(Chichester Diocesan Fund and Board of Finance v Simpson) and (S1, Charities Act 2011).
What is the time limit for charitable trusts? Is this number similar to other trusts?
They may be perpetual and no other trusts have a time limit.
What did the (Charities Act 2006) do to the previous law?
Majorly reformed and consolidated old law.
What did the (Charities Act 2011) do to the previous law?
Tided up (more user friendly) and further consolidation.
What is a charity? What statute and section addresses this?
A trust for charitable purposes only (s1(1) CA 2011).
What is a charitable purpose? What statute/section address this?
Anything that falls within section (s3(1) CA 2011) and is for the public benefit as addressed in (s4 CA 2011). (s2(1)) addresses this.
What statute/section contains the list of charitable purposes? Which contains the clarifications?
(s3(1)) contains list of purposes while (s3(2)) clarifies those listed in (s3(1)).
What are the charitable purposes?
1) the prevention or relief of poverty;
2) the advancement of education;
3) the advancement of religion;
4) the advancement of health or the saving of lives;
5) the advancement of citizenship or community development;
6) the advancement of the arts, culture, heritage or science;
7) the advancement of amateur sport;
8) the advancement of human rights, conflict resolution or reconciliation or the promotion of religious or racial harmony or equality and diversity;
9) the advancement of environmental protection or improvement;
10) the relief of those in need because of youth, age, ill-health, disability, financial hardship or other disadvantage;
11) the advancement of animal welfare;
12) the promotion of the efficiency of the armed forces of the Crown or of the efficiency of the police, fire and rescue services or ambulance services;
13) any other purposes—
(i) that are not within paragraphs (a) to (l) but are recognised as charitable purposes by virtue of section 5 (recreational and similar trusts, etc.) or under the old law,
(ii) that may reasonably be regarded as analogous to, or within the spirit of, any purposes falling within any of paragraphs (a) to (l) or sub-paragraph (i), or
(iii) that may reasonably be regarded as analogous to, or within the spirit of, any purposes which have been recognised, under the law relating to charities in England and Wales, as falling within sub-paragraph (ii) or this sub-paragraph.
What is the structure (in order) for approaching a problem question in the exam?
s1 - is the trust exclusively charitable? —> s2 - what is a charitable purpose? —> s3 - is it a purpose from the (s3(1)) list? —> s3 - any clarifications from (s3(2))? —> case law - any old authorities? —> case law - post act authorities? —> s4 - is it for the public interest?
What is poverty for the purposes of CA 2011? Which case illustrates this?
Poverty does not mean destitution. It means going short in a broad sense (negative definition) (Re Coulhurst).
For the purposes of CA 2011; what does ‘advancement’ mean in advancement of education? Which case illustrates this? What are the facts of the case briefly?
Advancement means the creation and spread of useful knowledge (Re Hopkins - investigation of whether Shakespeare wrote his plays and results are to be spread).
Is spreading the information for the purposes of advancement of education essential? What are the exceptions if any? Which case illustrates this? State the facts briefly.
Yes it is essential without any exceptions (Re Shaw - man wanted to research alphabet to see if he can add to it but without spreading).
Is there a qualitative test for charities for the purposes of advancement of education? Which case illustrates this? Give facts briefly.
Yes (Re Pinion - man wanted to spread/display rubbish and bad art).
For advancement of religion, what criteria causes something to qualify as ‘religion’?
1) belief in a god, goddess, supreme being, divine, transcedental being or entity or spiritual principle; 2) worship or reverence; 3) a degree of cogency, cohesion, seriousness, and importance; 4) positive, beneficial, moral or ethical framework.
What section is public benefit under?
Section 4.
What are the criteria for the assumption of public benefit for any purpose? Which statute/ section codifies this? Which case illustrates this?
You cannot assume public benefit for any one purpose (s4(2)) (Independent Schools Council Case).
Who should be benefiting from the charity for it to be considered for the public benefit? Which case illustrates this?
‘sufficient section of the public’ (Independent Schools Council Case).
For a charity to have public benefit, what is considered a ‘benefit’? Which case illustrates this?
This is case specific: i.e. nuns praying for community is not considered as a benefit per the law (Gilmour v Coats).
What is the ‘personal nexus rule’? Which case illustrates it?
Those who may benefit must not be linked by connection such as family, common employer, etc. (Oppenheim).
What is the exception to the ‘personal nexus rule’? Which case illustrates this?
Trusts for the relief or prevention of poverty (Dingle v Turner).
