Question 1A Flashcards
deals with certainties, formalities, and effective transfer
what are the formality requirements relating to a declaration of trust?
Law of property act 1925 - s.53 (1) (b)
▪”manifested and proved”
▪no formality requirements for constructive, implied and resulting trusts or personalty
what are the formality requirements relating to the ‘disposition’ of an equitable interest?
Law of property act 1925 - s.53 (1) (c)
▪”must be in writing”
▪”or by will”
what would constitute a ‘disposition’ for the purposes of s.53 (1) (c) LPA 1925?
A disposition is an “act by which someone ceases to be the owner”
Must be “in writing”
issue: can it be identified with sufficient certainty who the beneficiaries (OBJECTS) of the trust are? if not, the trust is void.
Identify type of trust;
- DISCRETIONARY TRUST - Is/is not Test (broad test).
▪Relevant test laid down by House of Lords in Mcphail V Daulton > ‘Conceptual certainty’
▪Administrative unworkability > Beneficiaries too wide = No trust held - FIXED TRUST - Fixed list test (narrow test)
▪Relevant test laid down in IRC V Broadway Cottages > Whether the objects are ascertainable with clarity
Issue: Is there certainty of intention? If not, trust is void.
▪Precatory words (hope rather than obligation); e.g. “in full confidence” - Re Adams V Kensington Vestry
▪Loose conversations - Jones V Locke
▪Rowe V Prance
▪No certainty to create a binding trust, merely a gift?
▪What does constitute certainty are imperative words which express duty e.g. “to be held by”..
Issue: Is there certainty of subject matter? If not, trust is void.
Certainty of trust property:
▪Sprange V Barnard
- “Condition: remaining part of what is left”
- Court said this is not sufficiently certain
▪Palmer V Simmonds
- “Bulk” of residuary estate
- Not sufficiently certain
▪Sometimes the court can step in and determine subject matter; e.g.
Re Golay’s WT - “reasonable income”..
Anthony V Donges - “minimal part”..
What are the formality requirements for a will?
Wills Act 1837 s.9 lays out requirements for will
(a) must be in writing, signed by testator
(b) appears testator intended [to give effect to the will]
(c) two or more witnesses..
Modes of constitution of trusts - Effective transfer
The two modes of trust creation are mutually exclusive
- Self as trustee - declaration transferring beneficial interest to beneficiary, while legal title remains with original owner as trustee
- Legal title to trustee(s)
▪essential to transfer the asset in the manner prescribed by law. i.e. for land this means transfer by deed (LPA 1925 s.52)
Strict rule:
According to Turner LJ in Milroy v Lord, “…the settlor must have done everything…necessary…to transfer the property…”
Because:
>Equity will not perfect an imperfect gift
>Equity will not assist a volunteer
▪Ineffective transfer – but equity’s
‘gloss’: Relaxation of strict rule (the ‘gloss’):
>Can be traced through a series of cases: Re Rose (1949) - Re Rose (1952) - Mascall v Mascall (1984) - Choithram v Pagarani (2001) - Pennington v Waine (2002)
> The ‘gloss’ is such that the settlor/donor must now do everything in his/her power to transfer the property
> Because:
“Although equity will not aid a volunteer, it will not strive officiously to defeat a gift”
▪Ineffective transfer – but one of the “exceptions”applies:
> Rule in Strong v Bird
Rule in Re Ralli’s WT
Donatio Mortis Causa (DMC)
Proprietary estoppel
Exception to ineffective transfer: Strong v Bird
Strong v Bird holds that for the exception under that rule to apply, there must be an intent, which is continuing until the donor’s death, to make an immediate gift. Transfer of ownership over the subject matter must follow, and that subject matter must be capable of enduring beyond the donor’s death
So, it’s an exception to teh rule on transfer because - the requirements for transfer are that it must be immediate and effective (or provided for by will). With this, there is transfer, but it’s effectively deferred till post-death
