the three certainties

Question 1

What must a trust overcome in order to be valid?

Answer 1

the three certainties

Question 2

what do the rules on certainties apply to?

Answer 2

Private trusts not charities
Express trusts - not implied, resulting or constructive trusts

Question 3

why do the rules exist?

Answer 3

• the trustees should be able to know the extent of their duties
• the court can determine whether there has been a breach of trust

Question 4

what are the three certainties?

Answer 4

intention
subject
object

Question 5

what would the issue be without these three certainties?

Answer 5

a trustee cannot be certain that they hold a property on truest

Question 6

in Vucicevic v Aleksic [2017] how did HHJ Matthews define certainty of intention?

Answer 6

certainty of intention = that the testator intended to create a trust rather than some other legal arrangement

Question 7

without intention there is no ..

Answer 7

express trust

Question 8

how can intention be demonstrated?

Answer 8

• put it in writing
• use the word ‘trust’ - Re Kayford [1975]
• use of imperative and precatory words
• by circumstances/actions - Paul v Constance [1977]

Question 9

what is certainty of intention?

Answer 9

a certain intention to create a trust
- has a sufficient intention to create a trust been manifested
- precatory words can give rise to a trust but sometimes don’t

Question 10

what is certainty of subject?

Answer 10

certainty with regard to the assets subject to the trust and the shares which they are to be held by the beneficiaries

Question 11

what is certainty of object?

Answer 11

certainty with regard to beneficiaries or purposes of the trust
think about who or what the trust has been created for

Question 12

what are the two forms that lack of certainty of subject matter take?

Answer 12

the property itself may be uncertain - in which case there will be no trust at all
the beneficial entitlement of particular beneficiaries may be uncertain - in which case the trustees will hold the fund on resulting trust for the settlor

Question 13

when is there different tests for certainty of objects?

Answer 13

depending on which type of trust is being dealt with

Question 14

what did IRC v Broadway Cottages Trust [1955] conclude about fixed trusts?

Answer 14

you must be able to identify every beneficiary in order to have certainty of objects in terms of fixed trusts

Question 15

what is the test applied for certainty of objects in terms of fixed trusts?

Answer 15

complete list test

Question 16

what must you have to have a complete list?

Answer 16

conceptual certainty
evidential certainty
ascertainability - class members must be identifiable

Question 17

what is a fixed trust?

Answer 17

the amount the trustee is obliged to give to the beneficiary is fixed
they must pay the money to the right people. but they must know exactly who these people are

Question 18

what is a discretionary trust?

Answer 18

the trustees choose how to divide the trust. it is not fixed by the settlor
the trustees have discretion over how much to give each beneficiary

Question 19

what is the test used for certainty of objects in terms of discretionary trusts?

Answer 19

individual ascertainability test

Question 20

what is the individual ascertainability test?

Answer 20

beneficiaries claim to be a beneficiary
must be determined whether they are part of the class that would be a beneficiary or not
objective criteria to be a beneficiary
if they can prove they are in the class, they can be entitled to the beneficiary

Question 21

in Vucicevic v Aleksic [2017] how did HHJ Matthews define certainty of subject matter?

Answer 21

certainty of subject matter = the property subject to the trust can be ascertained

Question 22

in Vucicevic v Aleksic [2017] how did HHJ Matthews define certainty of objects?

Answer 22

certainty of objects = the beneficiaries or purposes of the trust are clear