three certainties

Question 1

In order to create a vaild trust what are the 3 certainties

Answer 1

CA - Knight v Knight
1) certainity of intention
2) certainity of subject matter
3) certainty of objects

Question 2

how to prove certainity of intention (words)

Answer 2

words that are mandtory and obligatory e.g. I direct that.. or i require that
it shouldnt be pecatory words like hope and desire

Question 3

true or false - trusts can be contructed from actions

Answer 3

answer: true
CA - paul v constance - declaring from time to time that money in an account - is sufficient

sham declaration are not considered - CA midland banks PLC V wyatt

Question 4

what if there is no cetainity of intention

Answer 4

there will be no trust

Question 5

What is certainty of subject matter?

Answer 5

1) the trust property needs to be identifiable to the trustee
2) also the interest gained by the beneficiary

The trust is likely to fail if the property left on trust is unidentifiable or uncertain.

Question 6

how do we know if something is certain

Answer 6

CA - palmer v Simmonds (1854) “the bulk of my residuary property” - this failed becuase what are not sure what bulk means

HOWEVER COMPARISION

re golay will trusts - the court dertermined that a trust to pay “reasonable income” would not fail as a reasonable income was something which the courts could quanify - objective standard

Question 7

what if there is certainity of the subject matter of the trust but not the benefical share

Answer 7

unless trustee have discretion to determine the amounts - the trust will fail and the property will be held on a resulting trust

CA - Boyce v Boyce

Question 8

unascertained property

Answer 8

1) buying goods from a seller who later goes bankrupt can lead to problems
2) some buyers attempt to priotize their ownership claims over the goods they paid for but didnt reciceve espeically when the items were part of a larger batch
3) however if the purchased goods were not kept seperate from in the seller’s possession = claim failed
4) cannot be trust of unidentifable chattles

Question 9

what are the cases for unascertained properties

Answer 9

CA - re london (1986) - trust property must be separate
Re goldcorp - need segreation of the products

Question 10

what is the act that have now allowed you to have unascertained goods

Answer 10

sales of good amendent act 1995 - if you have paid for unascertained goods you are deemed to have property rights in them regardless of segregation

Question 11

what is the exceptions for chattles

Answer 11

doesnt apply to money, shares and other choses in action
no different between the units e.g one pound is the same as another

so

ca - hunter v moss [1994] - trust was delcared for shares upheld by the CoA
ca - macjordon construction ltd v brookmount erostin - tried to create a trust for money = failed - not idetifiable

Question 12

what happens if there is no certainity of subject matter?

Answer 12

1) gift to donee absolutely CA - rule in hancock v watson
2) resulting trust for settlor - goes back to them

Question 13

what is certianity of objects

Answer 13

identifying the beneficaries

Question 14

what are the types of dispositions

Answer 14

fixed trust
discretionary trust
power
gift subject to condition precedent

Question 15

discrentionary trust

Answer 15

the trustee has discretion as to how to distribute the property between the beneficiaries
an example is distribute amosgst my nieces as my trustees think fit

Question 16

powers

Answer 16

a power is a legal right to deal with, manage or dispose of property
powers are discretionary, a person does not have to excerise them
in this context it is the poweer to distribute property on behalf of another

Question 17

how to distinguish trusts and powers

Answer 17

trusts are equitable
powers are legal
trusts are mandatory
powers are discretionary
powers are generally a gift over in default of appointment - where undistriubuted property goes

Question 18

what is a fixed trust

Answer 18

the trust instrument states the share or interest of the beneficaries
an example is an trust for my nieces in equal shares

Question 19

what is the test for fixed trusts

Answer 19

complete list tests
CA - Morice v Bishop of Durham - the objects test for fixed trusts is the complete list tests
the trustees have to be able to make a complete list of the beneficaries
but what if the records buildings burns down??

Question 20

gift subject to condition precedent

Answer 20

a gift ( not a trust) to those who meet a condtion e.g. re barlows - when the paintings were sold, the first opportunies to buy them and at a discount would go to the testator’s friends

Question 21

what is the test for powers

Answer 21

is or is not test
CA - Re Gulbenkian - the objects test for powers is the is or not test
must be able to say with certainitry whether someone is or is not an object

Question 22

what is the test for discrentionary trust

Answer 22

is or is not test
CA - McPhail v Doulton - a discrentionary trust is vaild “if it can be said with certainty that any given indvidual is or not a memeber of the class”