Express trusts- The three certainties Flashcards
What is certainty of intention?
Intention to create a trust and assume the duty of a trust.
What approach do the courts take in ascertaining intention?
Objective approach.
How do courts interpret the meaning of words in trying to find intention?
Words are given their natural and ordinary meaning.
Any contextual features too.
What is certainty of subject matter?
- Must be possible to identify the trust property.
- It must be possible to ascertain the beneficiary’s interest in the trust property.
How to identify subject matter out of a larger mass?
Fractional interests are ok e.g 20% of 100 ordinary shares.
However, specific number of items from a larger mass will not have certainty of subject matter.
Must be intangible and fungible (e.g identical and readily exchangeable).
What is the beneficial entitlement requirement for subject matter?
Must be possible to ascertain the nature and extent of the beneficiary’s interest in the trust property.
How to determine certainty of objects?
Trustee must know exactly who is to benefit and how much they are to recieve.
What is a fixed trust?
Beneficiaries and individual entitlements are fixed.
What is a discretionary trust?
Who to allocate and how much of the trust is decided by the trustee
What is conceptual and evidential certainty for a fixed trust?
conceptual certainty- precision of language and evidential certainty is the ‘complete list’ test.
What is conceptual and evidential certainty for a discretionary trust?
conceptual- ‘is or is not test’
Evidential- satisfied that they are within the class
Must be administratively workable too.
what are the requirements for an express trust?
- three certainties.
- a beneficiary.
- compliance with perpetuity rules
- transfer on trust (constitution)
