L2 - Trusts of land and TLATA 1996 (rev notes) Flashcards
Trust of land
TLATA s1(1)(a) introduces a new ‘trust of land’ = ‘any trust of property which consists of or includes land’
=> includes ETs, ITs and RTs, as well as trusts for sale and bare trusts = (s1(2)(a))
No more SLA settlements or trusts for sale
s2(1) TLATA : Any attempt to create new SLA settlement or trust for sale will take effect as a trust of land
- Old SLA settlements existing on 1st January 1997 continue to exist in original form
- Old trusts for sale existing on 1st January 1997 converted into trusts of land
Main ≠w/ old trust for sale
(1) Ts have implied power to postpone sale which cannot be excluded by S = s4(1)
(2) doctrine of conversion no longer operates on property held under a trust of land = s3(1)
Trustee powers under TLATA #1: general
s6(1) TLATA: “for the purpose of exercising their functions as trustees, the trustees of land have in relation to the land subject to the trust all the powers of an absolute owner”
= have ability to sell, mortgage, grant leases and create other rights over land (easements or options etc) without automatically being in breach of trust
Trustee powers under TLATA #2 : specific powers (5)
- power to postpone sale, despite any provision to the contrary = s4(1)
- power to force Bs of full age and capacity to accept conveyance of land to themselves = s6(2)
- power to acquire land = s6(3)
- power to partition the land = s7
- power to delegate their functions to one or more Bs (of full age & absolutely entitled) = s9(1)
Trustee Duties (5)
Ts of trust of land no ≠ from other Ts => subj to general rules of equity abt Ts duties = s6(6)
+ s6(5) : duty to “have regard to the rights of the beneficiaries” when excercising their powers
+ s6(9) : duty of care imposed by s1 TA 2000 applies to trustees of land
+ s9A : duties in relº to delegation (see below)
+ s11(1) : Duty to consult and give effect to wishes of B (so far as practicable and consistent w/ purpose of the trust)
Excluding / restricting powers
= s8(1) TLATA : S can exclude and restrict powers contained in ss6 and 7 by express provision
Requiring consent
= s8(2) TLATA : S can impose requirement for T to obtain consent from someone before excercising s6-7 powers – if consent not obtained, breach of trust
=> if person whose consent is required is a minor, obtain consent of parent / pers w/ parental responsibility = s10(3)
=> If consent of more than 2ppl required, consent of any 2 is enough = s10(1)
=> if impossible to obtain consent of person prescribed under s8, Ts should protect themselves by making application to court under s14
Duty to consult and give effect to wishes of Bs
= 11(1) TLATA : The trustees of land shall in the exercise of any function relating to land subject to the trust :
(a) so far as practicable, consult the beneficiaries of full age and beneficially entitled to an interest in possession in the land
(b) so far as consistent with the general interest of the trust, give effect to the wishes of those beneficiaries, or (in the case of dispute) the majority (according to the value of their combined interests)
/!\ s11(2) : s11(1) doesn’t apply to s6(2) power + can be expressly excluded / limited by S
+ ‘so far as consistent’ w/ general interest fo the trust = gives Bs less control than directly requiring their consent
The power to delegate (= involve Bs) #1 : the provision
s9(1) TLATA : Ts can delegate ‘any of their functions as trustees which relate to the land’ to “any beneficiary or beneficiaries of full age and beneficially entitled to an interest in possession in land subject to the trust”
The power to delegate (= involve Bs) #2 : bulletpoints (5)
- B must be ‘entitled to an interest in possession’ (≠ future interest)
- s9(7) : Bs to whom powers have been delegated are ‘in the same position as trustees’ = have same duties and liabilities ‘in relation to the exercise of their functions’ BUT are not to be regarded as Ts for other purposes (ntb receipt of money / dealing w/ capital other than land)
-
s9(3): Delegation must be made by all Ts jointly, may be revoked by any one or more of them, is revoked by appt of a new T
+ must be made by power of attorney = deed giving authority to act as agent - s9(4): power is revoked if B ceases to be a B or the right kind of B
- s9(5): delegation can be for any period or indefinite
Trustee duties in relation to delegation
= **S9A* TLATA :
s9A(1) : duty of care under s1 TA 2000 applies when deciding whether to delegate and carrying out s9A(3) duties
s9A(3) : duty to review delegation + consider whether need to exercise power of intervention (= s9A(4) : power to give directions to B or revoke delegation)
s9A(6): T is not lb for any act or default of B unless fails to comply w/ duty of care
B’s right to occupy - before TLATA
Before TLATA : Bs had right to occupy under SLA settlement, but more complicated under trust for sale bcs doctrine of conversion
=> B’s interest in proceeds of sale, not the land so had no right to occupy unless expressly provided by S / permitted by Ts’ discretion
BUT diff application in family home cases :
- Bull v Bull (CA) : equitable TIC had right to occupy until sale => couldn’t be evicted by legal O
- Williams & Glynn’s Bank v Boland (HL) : B under trust for sale had an interest in the land itself
B’s statutory right to occupy
= s12 TLATA
s12(1) : B entitled to interest in possession under trust of land is entitled to occupy the land at any time if
(a) purposes of the trust include making the land available for his occupation (or the occº of Bs of a class of which he is a member or of Bs in general), or
(b) the land is held by the trustees so as to be available
/!\ can be restricted / excluded under s13
B’s statutory right to occupy - restricting / excluding (5)
- Ts have power to exclude or restrict right to occ of any but not all beneficiaries = s13(1)
/!\ only so far as is reasonable = s13(2) - Ts can impose “reasonable conditions” on B in relation to occupation of land = s13(3)
=> incl requirement to pay outgoings / expenses in respect of the land or ‘assume any other obligation’ in relº to land / activity conducted there = s13(5) - in excercising s13 powers, Ts must have regard to (a) intention of S, (b) purpose for whilch land is held, and (c) circumstances and whishes of each B who is entitled to occupy under s12 = s13(4)
- B in occupation can be required to make compensation payments to other Bs not allowed to occupy, or forego other payments under the trust to which they would be entitled = 13(6)
- Ts mustn’t exercise their s13 powers so as to prevent person in occ of the land from continuing to occupy / in a manner likely to result in their ceasing to occupy, unless he consents or the court has given its approval = s13(7)
