Three Certainties

Question 0

Re Adams & the Kensington Vestry (1884)

Answer 0

Certainty of intention:
Courts will look at the overall intention of settlor NOT the exact wording when deciding whether there is an intention to create a trust.

Trust not imposed, was considered a gift.

Question 1

Knight v Knight (1840)

Answer 1

3 conditions for a valid trust:

1) Certainty of INTENTION
2) Certainty of OBJECT
3) Certainty of SUBJECT MATTER

Question 2

Comiskey and Others v Bowring-Hanbury & Another (1905)

Answer 2

Trust was enforced due to overall intention of the settlor rather than specific meaning of the words used.
Trust was imposed upon wife to ‘make such use of it as I should have made myself and that upon her death she will divide it between my nieces as sees fit and in any failure of disposition be equally divided among the surviving nieces’

Question 3

Paul v Constance (1977)

Answer 3

Court can impose a trust after inferring intention of settlor.
Court imposed a trust on the bingo winnings despite there not being one as they were ‘simple folk unaware of equity’

Question 4

Re Lambe v Eames

Answer 4

Precatory words are not enough to demonstrate intention of trust.

Question 5

Re Steeles Wills Trust -

Answer 5

Words previously recognised as trust creating (Shelley v Shelley) are strong evidence of an intention or create a trust.

Question 6

Re Kayford (1975)

Answer 6

Technical words like ‘trust’ need not be used if substance is sufficient to manifest a trust.

Question 7

Sprange v Barnard (1789)

Answer 7

Certainty of subject matter:
Will leaving £300 to husband for his sole use… at his death ‘remaining part left/he doesn’t want’ divided between her brother and sister.

VOID- impossible to enforce as subject matter was too vague.
Husband took the money absolutely as a gift.

Question 8

Boyce v Boyce (1849)

Answer 8

Subject matter (which house was meant to go to which daughter not decided as daughter died before choice could be made) was uncertain. 
-TRUST INVALID

Question 9

Palmer v Simmonds (1854)

Answer 9

‘Bulk of estate’ to be left to certain people was VOID- Subject matter not certain enough.

Question 10

Re Golay’s Wills Trusts (1965)

Answer 10

‘Reasonable income’ was held sufficiently certain as the Court was able to identify criteria/quantity of subject matter (chiefly pervious living standards).

Question 11

Certainty of subject matter: Intangibles v Tangible

Hunter v Moss -Intangible

Answer 11

A number of shares were left, the shares were all in the same company.
Trust was held VALID as the subject matter was identifiable.
-Law is more benevolent towards intangibles.

Question 12

Re London Wine Co.

Answer 12

Different wines had been sold to different customers.
The company went into receivership.
It was held that the wine was not held on trust for the customers as the stock had not been allocated or segregated therefore the subject matter was insufficiently clear.

Question 13

Certainty of Object Fixed Trusts. 6 part test.

Answer 13

i)Essential test for certainty - must be possible to identify all the beneficiaries from the moment the trust comes into operation.
ii) Conceptual certainty
iii) Ease of proving someone as an object.
iv) Ascertain where an object is.
v) Size of class - can you list beneficiaries- then valid.
Vi) How sensible is the settlor’s intent?

Question 14

Emery (1982)

Answer 14

Objects of the trust must be defined with sufficient certainty to enable the Court if the trust defaults, to execute the trust according to the settlor’s/testator’s intention.

Question 15

Certainty of Object - Fixed trusts

Inland Revenue Commissioners v Broadway Cottages Trust (1955)

Answer 15

Trust failed as all the beneficiaries could not be listed.

It must be possible to identify all the beneficiaries from the moment at which the trust comes into operation.

Question 16

Discretionary Trust

McPhail v Doulton (HL)/ Re Baden’s Trust (Chancery)

Answer 16

Valid- if certain that any given individual was or was not a member of relevant class. - it is not necessary to ascertain everybody in class.

ANY GIVEN PERSONS TEST- Court must be able to tell of any person whether they fall into the class or not.

Question 17

iii) Evidential certainty

Answer 17

Even if definition of objects is certain, if if is not possible to prove who the objects are, complete list test will not be satisfied.

Question 18

iv) Ascertainability

Re Gulbenkian (1970)

Answer 18

It does not matter that the location or continued existence of particular beneficiaries cannot be established.
The property will be distributed amongst those who can be ascertained.
The share of anybody who cannot be ascertained can be paid into court.

Question 19

Resolving the uncertainty of objects:
Methods in which uncertainty as to objects might be resolved.
i) Trustees as arbiter
- Re Coxen 1948

Answer 19

Trustees are able to be arbiters about questions of evidential certainty.
Re Coxen: held legitimate for the testator to allow the trustees to determine whether a condition for revoking a gift had been satisfied.
However this was only possible if the terms of condition were defined with sufficient certainty.

Question 20

Re Wrights Wills Trusts 1987 -

Answer 20

Held that a residuary gift to trustees to use it in ‘their absolute discretion for such people and institutions as they think may have helped me or my late husband’ was void for being conceptually uncertain.

IF THE DEFINING CONCEPT OF TRUST IS UNCLEAR THEN LEAVING IT TO TRUSTEES TO DEFINE THE CONCEPT WILL NOT BE SUFFICIENT TO SAVE THE TRUST.

Question 21

ii) Third party as arbiter
- it is acceptable to resolve questions of evidential uncertainty relating to the identification of objects by referring the matter to a third party whom the settlor has made an arbiter of the matter.
- Re Tuck’s Settlement Trusts

Answer 21

A trust was dependent upon marrying someone of the Jewish faith.
Held valid trust as a third party arbiter such as a Rabbi could judicate.

Question 22

Beneficiary principle

Morice v Bishop of Durham (1805)

Answer 22

There must be identifiable beneficiaries to enforce the trust at some point during the perpetuity period.

Question 23

Perpetuity Rule:

Perpetuities and Accumulations Act 2009

Answer 23

S5.1: ‘Perpetuity period is 125 years (and no other period)’

Question 24

Perpetuities and Accumulations Act 2009

S6.1 ‘Wait and See rule’

Answer 24

Wait and see rule applies where an interest would be void on the ground that property might not vest until after the perpetuity period has passed.
-in such circumstances the interest is not to be treated as void until it is clear that the property must vest, if at all, after the end of the perpetuity period.