Introduction Flashcards
What are the two key components of a Trust?
- The property component
- The obligation component
Who holds the legal title to trust property?
Trustee
Who holds the equitable title to trust property?
Beneficiary
What did Lord Shaw say there can be a Trust of?
A chattel, a chose in action, a right or obligation under contract, land
When will a Trust cease to exist?
When the Trust property, without any fault of the Trustee, is destroyed or consumed
What happens if Trust property ceases to exist due to Trustee fault?
Trustee personally liable to restore or pays compensation
What happens if a trustee fails to meet its obligations under a trust?
Beneficiary can sue for breach of trust
What are Trust objects?
beneficiaries or purpose of the trust
Can a trustee also be the beneficiary?
Only if there are other beneficiaries
What are the benefits of using a Trust?
- Separation of ownership and management
- Expertise
- Protection
- Flexibility
- Control
- Ringfencing on insolvency
What areas are trusts used for?
- Commercial arrangements
- Private arrangements
- Charitable purposes
What are some examples of trusts for commercial arrangements?
Publicly traded shares ownership
Investment funds
Pension funds
Tax efficient employee remuneration
Corporate tax avoidance
What are some examples of trusts for private arrangements?
Testamentary planning
Land ownership
Tax planning
What types of Trust are there?
- Express Trusts
- Implied Trusts (Resulting trusts, constructive trusts)
- Trusts by operation of law (statutory Trusts)
- Testamentary and inter vivos Trusts
- Fixed and discretionary Trusts
- Charitable/non-charitable purpose Trusts
- Bare Trusts
What is a Quistclose Trust?
Where parties mutually intend that the money is applied for a purpose
