Trust 4 - Three Certainties Flashcards

1
Q

What are the 3 certainties?

A
  • Intention
  • Subject Matter
  • Objects
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2
Q

What is certainty to intention?

A

Intention to create a trust

  • ‘desire’ that someone should do something not enough
  • Segregation of assets = key indicator
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3
Q

How is intention guaged?

A
  • objectively
  • irrelevant if they don’t know what a trust is
  • irrelevant if they didn’t intend to create a trust
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4
Q

Is the use of the word ‘trust determinative’ when considering intention?

A

No

its the rights and obligations that matter

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5
Q

What are the key cases on intention?

A
  • collecting rent on behalf of beneficiary into separate bank account - trust
  • Bingo winnings “as much yours as mine” & convo with bank manager & way account used - trust
  • customers money paid into separate account to protect from insolvency - trust
  • ownership of supplied materials was a charge rather than a trust
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6
Q

What is certainty of subject matter?

A

Must identify

  • trust property

AND

  • nature/extent of beneficial entitlement
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7
Q

When could certainty of subject matter fail from description?

A

Where property can’t be ascertained from description e.g. ‘bulk’ or ‘net assets’
NOT for shares though, you can just say a number but for everything else, must identify specific objects

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8
Q

When can you give away a percentage or number of a ‘bulk’

A

Only if its intangible and fungible - basically shares

Anything else you’d need to identify the specific items within the fungible whole.

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9
Q

Is ‘reasonable income’ sufficiently certain?

A

Yes

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10
Q

What are the cases for certainty of subject matter?

A
  • wine merchant held wine on trust but did not separate - failed
  • trust over 50 of 950 shares - didn’t fail as shares are identical
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11
Q

What is certainty of objects for fixed trusts?

A

if fails for some Bs won’t fail for all.
Looking for a complete list of Bs:
- conceptual (what the class is)
- evidential certainty (does x fall within that class) .

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12
Q

What are the tests for discretionary trusts?

A
  • is/is not test - is ‘this person’ in the list or not (even if can’t draw up a complete list)
  • conceptual (what the class is)
  • evidential certainty (does x fall within that class) .
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13
Q

What if the class of beneficiaries of a discretionary trust is too wide?

A

It will fail e.g. occupant of England as trustees have to consider the range of beneficiaries even if they don’t consider them individually

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14
Q

What if the class of beneficiaries of a power of appointment is too wide?

A

it won’t fail as there is no duty of the fiduciary to sample the whole of the population of beneficiaries.

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15
Q

What happens if a gift to someone whilst the donor is alive fails?

A

The Donee holds the property on trust for the Donor

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16
Q

What happens if a gift to someone whilst the donor is dead but its not clear that a trust was intended?

A

the donee gets the gift absolutely with only a moral obligation to distribute

17
Q

What happens if a gift to someone whilst the donor is dead and it clear a trust was intended?

A

Property won’t be transferred and instead form part of the residue

18
Q

Are the use of precatory words such as ‘it is my wish’, ‘I sincerely hope’, ‘I have no doubt’ likely to result in the creation of a trust?

A

No (unless it includes gift over in default of appointment clause)

19
Q
A