Resulting Trusts

Question 1

Westdeusche v Islington

Answer 1

Resulting trusts arise, (1) where there is a gap in the beneficial interest, or (2) where a contribution has been made to the purchase price of property. They are meant to give effect to the common intention of the parties. They are imposed where there is unconscionability.

Question 2

Pecore v Pecore (Canada)

Answer 2

Presumption of advancement only applies to minor children.

Question 3

Re Vinogradoff

Answer 3

Grandmother transferred stock into joint names of herself and her granddaughter. Court held that stock was held on trust for the grandmother.

Question 4

Dyer v Dyer

Answer 4

“The trust of a legal estate, whether freehold, copyhold or leasehold; whether taken in the names of the purchasers and other jointly, or in the names of others without that of the purchaser; whether in the one name or several, whether jointly or successive - results to the man who advances the purchase-money”

Question 5

Fowkes v Pascoe

Answer 5

Resulting trust was rebutted because on the facts it was clear that B intended to make a gift to F.

Question 6

Tinsley v Milligan

Answer 6

Couple bought property in name of only one party to defraud the benefits system. Other party could not rely on this reason to claim a beneficial interest (however could rely on evidence of common intention to share property).

Question 7

Tribe v Tribe

Answer 7

Can rely on illegal purpose if crime never actually happens.

Question 8

Vandervell No 2

Answer 8

If settlor does not divest himself adequately, an automatically resulting trust applied. In this case V did not entirely divest himself due to the option to buy back the shares.

Question 9

Vandervell v IRC

Answer 9

Trigger for automatic resulting trust - where there is a trust but the terms are not declared.

Question 10

Re Ames Settlement

Answer 10

Trigger of automatic resulting trust - failure of an express trust. In this case a trust was established for daughter’s marriage but the marriage never happened. The trust failed, automatic resulting trust returned the property to settlor.

Question 11

Re Gillingham Bus Disaster

Answer 11

Trigger of automatic resulting trust, failure of charitable trust, in this case the property is returned to those who have donated where possible.

Question 12

Re GKN Sports Club

Answer 12

Trigger of automatic resulting trust, funds remaining after the dissolution of unincorporated association, surplus goes back to contributors.

Question 13

Barclays Bank v Quistclose

Answer 13

Q gave loan to a company for the specific use of paying dividend to its shareholders, the money was not paid before insolvency. There was a resulting trust in favour of Q. “In the present case the intention to create a secondary trust for the benefit of the lender, to arise if the primary trust, to pay the dividend, could not be carried out, is clear and I can find no reason why the law should not give effect to it”.

Question 14

Twinsectra v Yardley

Answer 14

Money was sent to solicitor who was to transfer to Y only for purpose of buying specific property. In breach, was transferred to another solicitor who paid some of it out for other purposes, was a Quistclose trust.

Question 15

Gore v Mishcon

Answer 15

Quistclose trust claim failed as there were no express terms upon which the money was to be held, no evidence of exclusive use planned.

Question 16

Re EVTR

Answer 16

Money was lent for the purchase of equipment which was actually bought but the transaction was later terminated,, there was a Quistclose trust.

Question 17

Chambers (1997)

Answer 17

Alternative theory to Vandervell or Westdeutsche, resulting trusts are created due to a lack of any intention by the transferor to pass any beneficial interest to the transferee where the transferee has not provided the entire consideration for the property.

Question 18

Watt (2004)

Answer 18

“There is something beguiling about the Quistclose trust. It has the seemingly magical ability to turn a lender’s personal rights under a loan for a specific purpose into proprietary rights under a trust.”