History of Trusts

Question 1

outline brief history of court of chancery

Answer 1

• began with medieval system of writs under CoC on case-by-case basis
• multiple courts competing: CL court, Church courts
• 1258 = PC est. fixed set of standard writs
• King + PC can be petitioned for remedy
• King delegates petitions to Lord Chancellor
• then under CoC
• Rules of Equity emerged (due to outcomes varying based on LC)
• 2 bodies of law develop = CL court + Equity/CoC

Question 2

Earl of Oxford’s Case [1615]

Answer 2

• dispute over who owned plot of land
• CL + Chancery courts disagreed
  referred to King James I + PC
• Edict issued –> where dispute between CL + Equity = Equity prevails

Question 3

outline the history of the trust

Answer 3

• harsh medieval property laws (can’t leave in will, goes to eldest son, presence needed in court, losers in battle stripped)
• the “use” can convey property to Feoffee/Transferee (Trustee) whilst instructing them to hold it to the use of someone else (i.e. Cestuis/Beneficiary)
  - IF Transferee refused to stick to promise = Court of Chancery began enforcing the promises –> cannot get around it by selling land to someone else, as 3rd parties still must honour arrangement

Question 4

why does the use slowly start to look like a trust?

Answer 4

• because B’s can enforce rights against anyone/3rd parties = have property rights
• F has legal ownership

Question 5

what new device did chancery lawyers come up with?

Answer 5

• 2 uses in a row for same arrangement
• (1) Give land to A to the use of B
• (2) to the use of C
• Initially, 2nd = void, but 16th Century = upheld, especially where tax not being avoided

Question 6

outline the key features of a trust

Answer 6

• No limit on Beneficiaries
• MAX 4 Trustees of Land –> TA 1925 Section 34(1)
• No more than 4 legal owners
• Same person can be Settlor, T + B if they want
• NO Trust where Sole Trustee is Sole Beneficiary
• Trust property NOT available to T’s creditors

Question 7

what is a bailment?

Answer 7

Bailor transfers possession of goods to Bailee for specific purpose + always with a power to sue them, BUT w/o acquiring Legal Title

Question 8

what is a charge?

Answer 8

form of burden with which an asset is encumbered until burden is discharged