Trust Cheat sheet - Sheet1 Flashcards
Case Name
Principle
Crabb v Arun
PE allowed if supported by later conduct that is unequivocal - Words of conduct
Bibby v Sterling
Acquiescence PE - Must it have been obvious when action was made that they thought they had a
proprietary claim
Thorner v Major
Should be considered on the relationship of the two parties - retrospective context
Common Expectation
consistent dealing, reasonable expectation
Imperfect Gift
Intimate relationship, legitimate expectation. Unconscionable not to perfect
Acquiescence
Acting to detriment in mistaken belief of interest
Re Hay’s
trustee not bound to exercise mere power
Paul v Constance
no need for explicit words or even knowledge - common intention
Sprange v Barnard
Money left divided between beneficiaries is seen as gift not trust binding on the donee
Mussorie Bank v Raynor
Intention and Subject should be examined together as a serious settlor would be precise
Boyce v Boyce
Conditions that now can’t be met by one beneficiary can extinguish gift to other beneficiaries
Lehman Bros
Need for property to attach to
Re Golay’s Will Trusts
Sufficient certainty - reasonable income was found to be certain enough - “effective determinant”
Re Tuck Settlements
Trust can become certain if someone is appointed to decide on the beneficiary
if the appointed person is ready and willing to resolve the doubt or difficulty
Re London Wines
Segregation in order to be certain of assets - Wine bottles not certain. Which Wine bottle??
Re Goldcorp Exchange
Even where assets are identical, they must be segregated
Hunter v Moss
Are shares truly fungible - Same Class of Shares, Same company
Palmer v Simmonds
Bulk of Residuary - uncertain
Re Osoba
Purpose when gift is given to beneficiaryis treated as merely a statement of the testator’s motive in
making the gift
Re Astor
Purpose Trust - Not supported if not charitable
Re Endacott
Non Charitable Purpose trust - Limited - Useful Memorial
Re Denley
Purpose Trust - Indirect benefit of indidual(s) - Question of facts - justifiability
Re Hooper
Maintenance of Graves - Allowed - must not interfere with perpetuity
General principle on pets
Pets usually not allowed - Enforceability
Pettingall v Pettingall
Maintenance of Horse was allowed - legatee could enforce
Re Dean
Re Dean - Allowed for horse - Because residuary afterwards would be dealt with on discretion
- therefore beneficiary - enforced by Re Thompson Fox Hunting case
Re Coulthurst
Relief of Poverty - persons who have to go short - widowed women and orphans s3(1) CA
Re Compton
Relief of Poverty
Re Shaw
Increase in knowledge not object unless alongside education or teaching
Re Gulbenkian’s
matter of construction whether the power is a mere power or a trust power and the use of inappropriate
language is not decisive’.
Common sense approach to intention
Any given individual - is or is not part of the class test
Morice v Bishop of Durham
Beneficiary Principle
Re Benjamin
Benjamin Order - remedy for uncertainty of object
Other remedies include:
Missing beneficiary insurance: Evans v Westcombe [1999] 2 A11 ER 777.
Seek indemnity from other bfs
Pay bf’s share into court
Re Baden
any employees or relatives - sufficiently certain
is there conceptual uncertainty - reinforced is or is not test but could not be applied the exact same way as Gulbenkian
Contrast certainty of object cases
Re Sayer - Empowered to make payments - X
Re Saxone - Discretion be applicable - Yes
Disposition for employees
R v District Auditor
All or some inhabitants - void, unworkability - Meaning clear but far too wide
McPhail v Doulton
Is or is not - distinguished between conceptual uncertainty
Taylor v Taylor
Must be Evidenced in writing, not necessarily be made in writing
Parker
Not applicable to constructive or resulting
Rochefoucauld
Can be used as evidence of fraud
Grey v IRC
Oral disposition void for want of writing
Hudson v Hathaway
Email acceptable
Akers v Samba
Bonafide Purchaser
Re Rose
If donor has done all in their power, equity will complete the transfer - Constructive trust
Re Lysaght
Trust will not fail for want of a trustee
Milroy v Lord
Must Complete legal requirements to transfer, equity will not perfect an imperfect gift
Pennington
Equity will complete if unconscionable not to do so
Paul v Constance
Self declaration of trust
Musset v Bingle
Life + 21 years
Statutory - Perpetuities and Accumulation Act 2009
125 Years
Re Hooper
As long as the law permits - allowed
Pirbright v Salwey
As long as the law allows - allowed
Re Beloved Wilkes Charity
No duty to give reasons for exercises of discretion
Scott v National Trust
Duty to act in good faith
Inform themselves - take advice but not delegate discretion to anyone else, not even an expert
Re Hays
Duty to consider exercising power, but no duty
Luke v South Kensington
Unanimous
Grand View Private Trust Co Ltd v Wong
Not be used for improper purpose
O’Rourke
Duty to show beneficiaries trust documents
Re Beloved Wilkes Charity
No duty to give reasons for exercises of discretion
Re Londonderry
Can redact or withhold if the documents might show their reasons
Bartlett v barclays
Higher Duty of care imposed on experts than the ordinary statutory duty, Trustee Act 2000
Sch 2(7) TA 2000
Settlors can limit duty of care or relieve
If trustee has a trust power they have a duty
Duty to exercise discretion
Barclays v Quistclose
Primary and secondary - First for borrower Second for the lender - Discouraged widely
Cooper + Carreras
Both give support to a purpose trust view
Carreras - Gerard McCormack
Criticised as it ignores provision of preference under s239(4)(b) Insolvency Act Acts done within 6 months of insolvency are invalidated if they have the effect of giving preference to creditors
- However, Payments made under pressure were not held invalid as pressure removes intention to prefer
Twinsectra
Millet Resulting Trust for the benefit of the lender - No intention to create a trust where typically you are searching for an intention,
previously suggested it could be an express trust.
Seemingly applies that the priority crediting in the case of administration is the
subject of the trust
Borrower has power or duty to apply the money according to the lenders instructions. Lender is settlor and beneficiary in the situation?
Nathalie Koh Jia En Critique on Millets view
Lowers the threshold for finding intention to retain beneficial interest and fails to accurately locate the beneficial interest
Millet’s comparison to the resulting trust
Millet likens the resulting trust to a ‘retention of title’ (Romalpa) clause, money is still owned by the lender but the beneficiary has use of it only so far as its
necessary for the purpose. Not a positive intention to retain interest but a negative intention to not give up the interest
Lady Arden on quistclose
Fusionist - Dont fall neatly into any
What rivals Trust relationship
Loan Contraact rivals trust relationship
Solicitors for quistclose
Solicitors involved - You would hope the word trust is included - Intention is more clear
Prickly Bay
No segregation, High Interest Rate - Arden suggests other legal relationship
s214 Insolvency Act
discretion to declare that a director is liable to make a contribution to the company’s assets where the company has gone into insolvent liquidation
Arguments for Mandatory registration of trust
Willingness of lender to make loans
Chilling effect for businesses that rely on lending
ARguments Against
Too Many transactions get caught
Penn v Lord Baltimore
Court can order specific performance
American Cyanamid v Ethicon
Court can grant injunction - violated patent
Lawrence v Fen Tigers
Damages in lieu awardable
Recission
Mistake - Pitt
Voluntary Dispositions
Misrepresentations - Damages in lieu of recission
Davies v Ford
Substitutive and Reparative compensation allowed - Substitutive is controversial
AIB + Brudenell
support for reparative comp. Substitutive support depends on interpretation
Bartlett
Consequential gain can offset consequential loss
Defences to personal claims
Exclusion clauses
Consent/Waiver
s61 Trustee Act 1925 - honestly, reasonably and ought fairly to be excused
Wholly or partly
Armitage v Nurse
Court has discretion on limitation clauses
Re Paulings
Requires free consent from beneficiaries
Extinguishing Personal Property Interest
Terms of trust
BFP - Papadimitriou
Extinguishing Land Interest
Overreaching s2 LPA
Registrable Disposition s29 LRA 2002
Tracing is possible in
Sufficient connection to property
Simple Substitutions
Sales
Insurance Policies
SGA s17 and 18
Title of property often passes before payment
Sales - Serious Fraud Office v Hotel Portfolio II
Can trace into property bought using breached trust money
Foskett v McKeown
Can trace into life insurance and then the payout where payments are made with trust money in breach of trust
Brazil v Durant
Generally no backwards tracing unless ‘close transactional link’
Relfo v Varsani
Or if they were transferred on the basis that trust funds would replace assets
Re Hallet
Expenditure can be treated as trustees and money remaining can be traced into
Re Oatway
Expenditure can be treated as trust money and can trace into the asset bought
Cherrypicking
Choosing whether to apply Oatway or Hallet
Roscoe v Winder
the claimants cannot claim for more than the lowest balance in the account at any point of time
Clayton’s case
First in First out when two beneficiaries are involved
Byers v SNB
requirement of continuing proprietary interest - Remedy is as if the D was a trustee
Akindele
Sufficient degree of culpability - unconscionable
Agip
For their own use or benefit
Williams v Bank of Nigeria
Remedies unclear except for obiter - seems to restore assets
Royal Brunei v Tan
Breaches legal duty - culpability is unnecessary
Requirement for Dishonest assistance
Defendant dishonestly assists
Brinnks v Abu Saleh
Not nominal assistance
Group Seven v Notable Services
Make it easier than it would have been
Novoship
Remedy = disgorge them of profits
Ottaway v Norman
Intention to create an obligation
Communication of intention
Acceptance of that obligation
Blackwell
Outside the wills act
Re Snowden
Outside the will
Constructive Trust
Action + Reliance
OR
Express Trust
Intention not expressed in will format (s9 Wills Act) + Fraud = Trust
Blackwell
Goes against
McCormick
Fraudulent to go against the will, Fraudulent if the trustee of the secret trust goes against the wishes of the settlor
Vandervell
Presumed - Circumstances where transferror did not intend to make a gift
Automatic - Dispositive provisions in trust fail
LPA s60(3)
Conveyance shall not be merely implied
Stack v Dowden
Family home determined on Constructive Trust
Equality Act s199
Presumption of advancement is abolished - husband making gift to wife if transfers property
Tinsley v Milligan
Not relying on illegality but merely the presumption
Mirza
Does denying the claim furtehr the purpose of fraud
Public Policy interest
Proportionality
Westdeutsche
transferor intended the transferee to become absolute owner. The bank could only recover its money with simple interest as it only has a personal claim.
Re Rose
Once a trustee has done everything they are required to do
Pallant v Morgan
co-operative acquisitions. Constructive trust arises and held for both parties
Fraud - Bailey v Angove
Fraudster holds property on CT for the victim - provides following and tracing remedies - proprietary
Westdeustche
Stolen money is traceable in equity
Polly Peck
Remedial - award for legal action held on CT
Judicature Acts
Administrative Fusion
way forward
Substantive Fusion
Maxim on intention
Equity looks to the substance (intention) rather than the form
maxim on law
Equity Follows the law
maxim on priority
Where equities are equal the first in time prevails
Maxim on illegality
He who comes into equity must come with clean hands
Maxim on constitution
Equity looks on as done that which ought to be done
Penn v Lord Baltimore (1750) 1 Ves.Sen. 444
Equity acts in personam
Maxim on voluntary
Equity will not assist a volunteer
Subrin
Equity “fills in the gaps” of common law
In equity,
Promises binding without the need for consideration
Atiyah
Needless to have two complex doctrines where both operate to bind agreements and promises
Millet
seek the same result… but do not… draw the lines in the same place
Judicature Acts
Common law was to say the law had its roots in the common law courts/ Equity has its roots in the courts of chancery
Merge the courts
