Resulting Trust

Question 1

In General

Answer 1

Resulting trusts arise by implication from the settlor’s conduct. Resulting trusts are of three types: (1) purchase money resulting trusts, (2) resulting trusts arising on failure of an express trust, and (3)
resulting trusts arising from an incomplete disposition of trust assets (that is, excess corpus).

Question 2

Circumstances Giving Rise to Resulting Trust

Answer 2

A resulting trust arises where a settlor has conveyed property to a trustee under an express trust and (1) the trust is void or unenforceable, or (2) the beneficiary is dead or cannot be located. A resulting
trust may also apply on failure of a charitable trust where cy pres is inapplicable.

Question 3

Circumstances Where Resulting Trust Not Implied

Answer 3

A resulting trust will not be implied where: (1) the trust instrument specifically or implicitly provides for disposition of trust property when the trust has failed or been completed; (2) the settlor was given consideration for their original transfer in trust; (3) the settlor created the trust for an illegal purpose; or (4) cy pres is applicable in cases of charitable trusts.

Question 4

Purchase Money Resulting Trusts

Answer 4

A purchase money resulting trust is presumed whenever X (the “beneficiary”) furnishes the consideration (usually money, but any other valuable consideration suffices) for the acquisition of real or
personal property but, with X’s consent, title is taken in the name of Y (the “trustee”).