Resulting Trusts Flashcards
Tinsley v Milligan
Automatic resulting trust - where property has been transferred on an express trust that fails the property will be held on RT
Also authority for the impossibility of pleading an illegal purpose to prevent RT
Re Vandervell
An essential element of the resulting trust is that an interest in the property has either been transferred to, or created for, the D
Westdeutsche Landesbank
Lord-Browne Wilkinson stated that there was no distinction between presumed and automatic RTs and all RTs are presumed: this could be a cogent explanation – the law is simply giving effect to the presumed intention, he said – however, this cannot be so because of const. trusts
Vandervell (No.2) - inferred intent
For a trust to have inferred intent and thus be an express trust there must be proof cf. Megarry J
Lord Neuberger - ‘objectively deduced to be the subjective intention’
Pettit v Pettit
Proof of one fact can prove another by way of inference to find intention for a RT
Air Jamaica
Absence of intent can itself be express, imputed, inferred or presumed
Stack v Dowden
Presumption of a RT is not a rule of law but a presumption of intention -
Re Gillingham Bus Disaster Fund
Automatic RT - best explanation is an imputed intent, especially as most transferors do not intend to have the money returned but where the trust is cheated in some way so as to impute an intention for RT
Westdeutsche Landesbank (rebuttal of presumption)
The D can rebut the presumption of equity is cynical by proving that the property was given on an absolute gift or in some other way so as to receive it beneficially
Russell v Scott
Burden of proof being transferred and potentially rebutted in the presumption of intention – NB the presumption of advancement where the transferor has some kind of responsibility for D, which will switch the burden
Fowkes v Pascoe
Presumption and rebuttal also applies when C purchases in the name of D - ultimately, however, it will depend on the circumstances of the case e.g. buying through solicitor will be very difficult to rebut the presumption
Curley v Parkes
Indirect contribution to purchase price of property will give rise to a presumption of RT provided that it was when the property was acquired
Gissing v Gissing
Contributions to day-to-day bills are insufficient for RT hence its limited application and the use of CT in familial situations
Grey v Grey
Presumption of advancement to be abolished by s199 of EA 2010 but will probably not make a huge difference in practice
Tribe v Tribe - Locus poenitentiae
Withdrawing from the illegal purpose will mean that illegality will no longer stand as a barrier when attempting to rebut a presumption provided that considerable steps haven’t been made to achieve the illegality e.g. forging documents
Re Vandervell’s Trusts (No.2)
Automatic RT where A transfers to B and the property has partially or fully been undisposed of, B then holds on trust for A
Davis v Richards and Wallington
Where an intention to transfer property absolutely, this should be respected and negate a RT
Essery v Cowland
Initial failure of an express trust - must be inter vivos as a testamentary trust will simply fall into residue – must be illegal or impossible to execute, mere frustration is insufficient
Hodgson v Marks
An express trust will also fail where the formalities have not been abided by -
Vandervell 1
Vandervell 2
Wilberforce preferred imputed intention by operation of law in V1, which is contrary to Br.Wilk in Westedeutsche who said all are presumed
New trust was created for the children, but this is subject to critcism and contrary to HL in V1
Re the Trust of the Abbotts Fund
Re Gillingham Bus Disaster Funds
Subsequent failure of a trust - usually RT for the donors as once the purpose has been exhausted, i.e. they both died, there would be no other purpose for that money
Re Osoboa
Absolute gifts can be found, which will not see the trust fail, where a settlor leaves the whole of their estate to Bs
Re West Sussex Constabulary’s Widows, Children and Benevolent Fund Trusts
Bona vacantia - where property is ownerless, where contractual donors had divested themselves of any interest in the trust property because they had received benefits – this is different to Re Gillingham because it was a contractual relationship not one of trust – mere donors however received the money on RT
Barclays Bank v Quistclose Investments
Where money has been transferred for a specific purpose and that purpose fails then T may hold on trust for the settlor -
Twinsectra v Yardley
Identified as a Quistclose trust in a RT form, where money has been transferred, of which the transferee is not free to dispose at will, but which must be used for a specific purpose, then the money will go on RT back to the lender
R v Clowes (No.2)
Where property has been obliged to be kept separate, this evidence the non-free disposal of property being at play
Lipkin Gorman v Karpnale
Unjust enrichment - some have argued for RT to be extended because of this by theory of the absence of intention
Westdeutsche
(absence of intention)
The absence of intention theory is wide and has been rejected in W - seems excessively wide and when trying to apply restrictions it is complicated e.g. a contract being void ab initio
El Ajou v Dollar Land Holdings
Rescission of a voidable contract in equity – the property will be held not on RT but on CT instead
