Formalities and Constitution Flashcards
Which section of the Law of Property Act 1925 states that trusts over land must be in writing?
A. Section 52(1)
B. Section 9
C. Section 53(1)(b)
D. Section 36
C. Section 53(1)(b)
Explanation:
Section 53(1)(b) LPA 1925 requires declarations of trust over land to be in writing and signed.
What is the primary purpose of formalities in trust law?
A. To provide legal certainty and prevent fraud
B. To ensure trustees can make investment decisions
C. To create a legally binding contract between settlor and trustee
D. To allow a trust to be revoked at any time
A. To provide legal certainty and prevent fraud
Explanation:
Formalities ensure that trusts are valid, enforceable, and transparent. This prevents fraud and disputes over ownership
Which type of trust does not require formalities under section 53(1)(b) of the Law of Property Act 1925?
A. Express trusts of land
B. Testamentary trusts
C. Resulting and constructive trusts
D. Fixed trusts
C. Resulting and constructive trusts
Explanation:
Under section 53(2) LPA 1925, resulting and constructive trusts do not require written formalities.
When is a trust automatically constituted?
A. When the settlor declares themselves as trustee
B. When the trust property is transferred to a third-party trustee
C. When the trustee provides a written declaration
D. When a beneficiary consents to the trust
A. When the settlor declares themselves as trustee
Explanation:
A self-declared trust does not require legal title transfer, so it is automatically constituted.
A settlor orally declares a trust over land but does not put it in writing. What is the legal effect?
A. The trust is void
B. The trust is valid but unenforceable until written evidence is provided
C. The trust is enforceable based on verbal evidence alone
D. The trustee can choose whether to honor the trust
B. The trust is valid but unenforceable until written evidence is provided
Explanation:
Under section 53(1)(b) LPA 1925, a trust of land must be manifested and proved in writing to be enforceable.
A donor intends to transfer shares to a donee but fails to complete the stock transfer form. What is the outcome?
A. The donee automatically becomes the legal owner
B. The gift is imperfect and will not take effect
C. The donee can claim ownership based on intention alone
D. The transfer is valid if the donor writes a letter confirming the gift
D. The transfer is valid if the donor writes a letter confirming the gift
Explanation:
In Pennington v Waine (2002), a written confirmation by the donor made it unconscionable to deny the gift, allowing it to be perfected.
A father tells his son he is holding £10,000 on trust for him but never writes it down. What is the legal position?
A. The trust is invalid because there is no writing
B. The trust is valid because money does not require formalities
C. The trust is only valid if a solicitor is involved
D. The father must transfer the money into a separate trust account
D. The father must transfer the money into a separate trust account
Explanation:
In Paul v Constance (1977), a trust was upheld where money was treated as separate trust property, reinforcing the requirement of control.
A person transfers land to a trustee but fails to declare the trust in writing. What happens?
A. The trust is void
B. The trustee holds the land on resulting trust for the transferor
C. The court will enforce the trust automatically
D. The trust becomes a discretionary trust
B. The trustee holds the land on resulting trust for the transferor
Explanation:
If no valid declaration exists, the trustee holds the land on resulting trust for the original owner.
A donor intends to give their house to a relative but dies before executing the deed. What is the outcome?
A. The house automatically passes to the relative
B. The intended recipient can claim the house under equity
C. The house remains part of the donor’s estate
D. The relative can claim under constructive trust
D. The relative can claim under constructive trust
Explanation:
If the intended recipient had a common intention agreement or relied on the promise, a constructive trust may arise.
A settlor declares a trust orally and later confirms it in writing. What is the legal position?
A. The trust is valid from the date of the oral declaration
B. The trust only becomes valid from the date of the written confirmation
C. The trust is void due to late formalities
D. The trustee must re-declare the trust in court
A. The trust is valid from the date of the oral declaration
Explanation:
Once written evidence is provided, the trust is enforceable from the original declaration date.
