Resulting trusts - rev notes

Question 1

Word ‘resulting’

Answer 1

from latin ‘resalire’ = to jump back

Question 2

RT = (situation)

Answer 2

where A conveys rights to B, and B holds those rights on trust for A (beneficial interest ‘jumps back’ to A)

Question 3

2 types of RTs (Lord BW in Westdeutsche)

Answer 3

• Type A RTs (PRTs) : A transfers rights to B or contributes to purchase price of smth to which B gets title rebuttable presumption that A did not intend to part w/ BI (or whole of it)
• Type B RTs = ‘failing trust’ RTs (FRTs) : A transfers property to B on trusts which fail / don’t exhaust the entire beneficial interest 3

Question 3

Megarry J in Vandervell nº2 - PRT

Answer 3

= where A transfers rights to B, in the absence of consideration and presumption of advancement, rebuttable presumption that B intended to hold them on trust for A

Question 4

Megarry J in Vandervell nº2 - ART

Answer 4

= where A transfers rights to B on trusts which leave some or all of BI undisposed of -> B automatically holds on trust pt of BI which has not been assigned to others (doesn’t depend on any intention or presumption, simply on A’s failure to dispose of the whole of the BI)

/!\ can be controversial if read as division of O before trust

Question 5

Presumed Resulting Trusts (def)

Answer 5

= where A transfers rights to B, in the absence of consideration and presumption of advancement

=> rebuttable presumption that B intended to hold them on trust for A

Question 6

Pspº of RT arises where A

Answer 6

• Gratuitously transfers rights to B -> eg. National Crime Agency v Dong
• Provides all or part of the purchase price of property acquired by B -> eg. Dyer v Dyer (1788)

-> provides intention to create a trust

Question 7

Pspº rebutted by

Answer 7

any evidence of contrary intention (consideration, gift, payment under mistake or duress or undue influence) eg Fowkes v Pascoe (1875)

Question 8

Pspº of advancement

Answer 8

= where A is B’s husband, father or in loco parentis
-> provides intention to make a gift eg. Dyer v Dyer (1788)

Question 9

Pspº of RT is not v strong

Answer 9

eg easily rebutted in Fowkes v Pascoe

Question 10

Marr v Collie (2017)

Answer 10

Insistance on importance of ascertaining the intention of the parties rather than relying on presumption in recent cases

Question 11

Lord Diplock in Pettitt v Pettitt - weakness of Pspº of RT

Answer 11

equitable presumptions of intention are “no more than a consensus of judicial opinion disclosed by reported cases as to the most likely inference of fact to be drawn in the absence of any evidence to the contrary”

Question 12

Pspº of advancement arises where

Answer 12

• A is B’s husband (or fiancé) -> eg Silver v Silver (1958)
• A is B’s father, or in loco parentis -> eg Hepworth v Hepworth (1870), Bennett v Bennett (1876)

Question 13

Pspº of advancement does not arises where

Answer 13

• A is B’s wife -> Mercier v Mercier (1903), Abrahams v Trustee of Property of Abrahams (2000)
• A and B merely cohabiting -> Stack v Dowden (2007)

Question 14

Pspº of advancement criticised (4)

Answer 14

• because outdated and gender bias
• s199 Equality Act 2010 purported to abolish it (not yet in force)
• No longer applied in family home cases (Jones v Kernott (2012))
• Lord Diplock in Pettitt v Pettitt quote (next card)

Question 15

Lord Diplock in Pettitt v Pettitt - criticising PA

Answer 15

” [I]t would be an abuse of the legal technique for ascertaining or imputing intention to apply to transactions between the post-war generation of married couples ‘presumptions’ which are based upon inferences of fact which an earlier generation of judges drew as to the most likely intentions of earlier generations of spouses belonging to the propertied classes of a different social era.”

Question 16

S60(3) LPA 1925 (text)

Answer 16

“In a voluntary conveyance a resulting trust for the grantor shall not be implied merely by reason that the property is not expressed to be conveyed for the use or benefit of the grantee.”

Question 17

S60(3) LPA 1925 (debate)

Answer 17

Was it intended to abolish the presumption in cases involving voluntary conveyance of title to land?

• obiter yes in Hodgson v Marks (1971) and Lohia v Lohia (2001)
• No in National Crime Agency v Dong -> ‘word saving provision’ : mischief s60(3) corrects = failure to say in a conveyance that property is conveyed ‘for the use and benefit’ of grantee -> presumption still arises in voluntary transfers of titles to land cases (per Chief Master March at [35])

Question 18

Justifying PRTs - 3 justifications

Answer 18

• a response to A’s intention (objectively interpreted) that B should hold the property on trust
• a presumed declaration of trust
• a response to B’s unjust enrichment / A’s lack of intention to benefit B

Question 19

Justifying PRTs - response to A’s intention that B should hold on trust

Answer 19

• Lord Upjohn in Vandervell v IRC (1967)
• crucial Q = whether A intended B to take beneficially or on trust
• view supported by HMM and John Mee

Question 20

Justifying PRTs - presumed DOT

Answer 20

Swadling’s view: presumption supplying A’s intention not enough bcs unexpressed intention not enough to create a trust => presumption must supply DOT to justify RT

=> On S’s view, fact supplied by presumption = successful DOT

Question 21

Justifying PRTs - unjust enrichment / A’s lack of intention to benefit B

Answer 21

• R. Chambers, P. Birks, Lord Millet in Air Jamaica
• idea that RT csq of fact A didn’t intend B to take beneficially
• Explains Re Vinogradoff (BUT could just be wrongly decided / A intended that she retain BI for life, and B bare trustee, then B gets beneficially)
• “Pushed to its logical limits, it suggests that a resulting trust should arise whenever A transfers property to B, and A’s intention to benefit B is vitiated by mistake or undue influence, or is conditional on the happening of a future event which subsequently fails to materialise.”
• view expressly by HL rejected in Westdeutsche: “even though A’s intention to make the transfer to B was vitiated by the mistaken belief that there was a valid contract between the parties, no resulting trust arose, as it was clear that A had never intended B to hold on trust for A”

+also not great in principle to give C in unjust enrichment cases proprietary remedy = priority over all of D’s unsecured creditors

Question 22

FTRT / ART arise where (5)

Answer 22

A transfers rights to B on trust but

• trust fails for uncertainty of object : IRC V Broadway Cottages (1955)
• trust fails bcs private purpose trust : Morice v Bishop of Durham (1805)
• transfer on trust fails for want of objects : Vandervell v IRC (1967)
• trust fails bcs offends rule ag perpetuities : Re Wood (1949)
• trust doesn’t dispose of the whole of BI : Re Abbott (1900)