Formalities

Question 1

What did Maitland say in regard to trust formalities?

Answer 1

A trust can be created ‘without deed, witout writing, without formality of any kind’.

Question 2

What does s9 Wills Act 1837 require?

Answer 2

1. In writing and signed by testator
2. Signature must be made or acknowledged in te presence of two witnesses present at the time.
3. Must be attested to

Question 3

What is the main exception to the rule that there are no formalities in creating a life time trust?

Answer 3

s53 LPA 1925

Question 4

What does s53(1)(b), law of property act 1925 state?

Answer 4

The creation of a trust of land must be in writing.

Question 5

What is te repercussion of a trust of property with no written evidence?

Answer 5

The trust is unenforceable

Question 6

What are the exceptions to s53(1)(1b)?

Answer 6

If you can establish an implied trust, e.g. a resulting or a constructive trust, then s53(1)(b) need not be complied with

Question 7

What is the authority for s53(2) LPA 1925?

Answer 7

Hodgson v Marks - Nephew didn’t like lodger, lodger got on wit landlord. Landlord persuaded to give the trust to lodger, so nephew couldn’t kick him out. Then sold property to Marks. Issue; whether there was a trust? yes resulting trust, as never intended to give full benefit to lodger. Therefore Marks bought property subject to Hodgson’s interest.

Question 8

What does s53(1)(c) state?

Answer 8

A disposition of a subsisting equitable interest must be made in writing

Question 9

How does s53(1)(b) and s53(1)(c) differ?

Answer 9

s53(1)(c) makes no provision for oral transfer, which is later evidenced in writing. The disposition of a subsisting equitable interest must be made from the beginning in writing.

Question 10

What is the repercussion of violating s53(1)(c)

Answer 10

The trust will be void, not just unenforceable

Question 11

What type of property does s53(1)(c) relate to?

Answer 11

Any

Question 12

What is the case for the 4 types of disposition?

Answer 12

Timpson’s executors v Yerbury;

1. Assign it directly to 3p
2. Direct trustee to hold for a third party
3. Contract for valuable consideration
4. Declare himself trustee for it, for 3rd party.

Question 13

Must an instance where the beneficiary directs the trustee to hold property on trust for third party be in writing? What is the authority?

Answer 13

Yes - Grey v IRC

Question 14

What are the facts of Vandervell v IRC ?

Answer 14

Vandervell had a trust with him as the sole beneficiary. Orally instructed his trustee to transfer the legal title to the royal college of surgeons. When transfer of legal title occurs with intention to transfer equitable title, equitable title also moves. When this occurs s53(1)(c) does not apply, so avoiding tax. Here as both E and L title are transferred s53(1)(c) does not apply.

Question 15

What is the ratio of Vandervell?

Answer 15

When the absolute beneficiary instructs trustee to transfer legal title, and intends equitable title to transfer as well ,s53(1)(c) is avoided, as both equitable and legal title are passing, rater than just equitable, which is what S53(1)(c) caters for.

Question 16

Does ss53(1)(c) apply if you sell your equitable subsisting interest?

Answer 16

Probably, however there is an exception - Neville v Wilson. If you have a contract to sell a beneficial interest in something unique, as this is specifically enfoceable so results in a resulting trust , so sidesteps s53(1)(c).

Question 17

Does s53(1)(c) apply if the beneficiary declares himself a trustee of his own beneficial interest for a 3rd party?

Answer 17

it depends; if court judges it is a new trust then s53(1)(c) does not apply. This is particularly likely where the trustee remains trustee due to a remainder clause. However where the third party is the sole beneficiary and therefore the trustee drops out of the picture, te trust might be judged an assignment so s53(1)(c) applies. However QC Green says all subtrusts are dispositions of subsisting interests, so very unclear what the case is.

Question 18

Is a disclaimer subject to s53(1)(c)?

Answer 18

No as you never had the interest so can’t give it away.(Re paradise Motor)

Question 19

What are the 2 qualifications for a disclaimer?

Answer 19

Must be aware of equitable interest that you are foregoing, and intention to disclaim must be clear.