trusts Flashcards

Question

Goodman v Gallant

Answer 1

The TR1 conveyancing form was changed from 1 April 1998 - purchasers to declare their interests in writing. Declarations in writing that comply with the formalities, absent duress, fraud, undue influence, misrepresentation = conclusive

Answer 2

Precatory words but old precedent

Answer 3

Re Wynn - trustee cannot decide Re Coxen - opinions of my trustees she shall... Re Tuck's ST - 'an approved wife'

Answer 4

1. if the words are so used, that upon the whole, they ought to be construed as imperative; 2. if the subject of the recommendation or wish be certain; and, 3. if the objects or persons intended to have the benefit of the recommendation or wish be also certain.

Answer 5

legal and equitable title separated

Answer 6

powers separate from trusts (fixed list) Attempt to fudge the law to encourage a discretionary trust to a fiduciary power in order for no need of complete list/certainty of object

Answer 7

capacity to do legal things but no compulsion (gift over) e.g. "the trustee MAY advance £1,000 to X" Re Hay's ST, Megarry VC: A mere power is very different [from an ordinary trust obligation]. Normally the trustee is not bound to exercise it, and the court will not compel him to do so. That, however, does not mean that he can simply fold his hands and ignore it, for normally he must from time to time consider whether or not to exercise the power, and the court may direct him to do this.

Answer 8

IRC v Broadway Cottages

Answer 9

Beneficial shares - divided equally

Answer 10

After McPhail, in a discretionary trust, the trustee has the discretion to appoint within a class of potential objects and the trust will fail only if the definition of the class is "conceptually uncertain". Providing the meaning of the words in the trust are sufficiently clear, so it can be said of any given person whether they would be or not a member of the class, it does not matter if every potential member cannot be identified by evidence

Answer 11

Settlor to define the class; the words he employ can either be very precise and ‘admit of little or no argument’ or can be highly imprecise, ``` The crucial point: Conceptual certainty is different from evidential certainty; the former refers to the fact that the class defined by the settlor has a precise boundary of meaning, in the sense that it is possible to state the necessary criteria for a person to be a member of that class ```

Answer 12

It is striking how narrow and in a sense artificial is the distinction, in cases such as the present, between trusts or as the particular type of trust is called, trust powers, and powers … Equal division is surely the last thing the settlor ever intended: equal division among all may, probably would, produce a result beneficial to none Maxim equity is equality

Answer 13

Husband paid mortgage and gave wife an allowance. Wife paid for furniture and clothing etc. Did not constitute as a financial contribution. No beneficial interest, despite her and her son living there until the divorce.

Answer 14

[T]he trust deed was executed by him, not to be acted upon but to be put in the safe for a rainy day … as a safeguard to protect his family from long-term commercial risk should he set up his own company.

Answer 15

``` Bulk Re London Wine + Re Goldcorp (no identifiable property as chattels) - must be fungible e.g. shares which can be objectively assessed ```

Answer 16

Re Baden’s Deed Trusts (No 2) [1973] Ch 9 (CA): Sachs LJ: Enough to be able to prove X is in the class. No need to positively prove X is not in the class. (Treat don’t knows as out) Megaw LJ: And a substantial number of objects required (not good enough to have a few relatives, need a ‘substantial number’) Stamp LJ; Must be able to positively prove whether X is in or out of the class. (need to prove both – almost complete list test?) 3 possibilities: In, out, don’t know

Answer 17

They have to exercise the trust but has the discretion in how this is determined (which beneficiaries to share it to) In or out Test Alastair Hudson gives the example of a trust "that [the trustee] shall divide the £1,000 between any of my sons who become unemployed, with the power to retain the whole of that £1,000 for the remainder beneficiary". This is a discretionary trust; the word "shall" means the trustee is forced to exercise his power, while the "power to retain the whole of that £1,000" gives him discretion over whether to retain the money.

Answer 18

In practice = little substantive difference Between trustee is exercising a permissive mere power and the trustee is exercising a discretionary trust power, therefore can use the same is or is not test. In both: T cannot act capriciously and is obliged to consider the exercise of her power in accordance with scope of power. Each potential B of a discretionary trust has the right to be considered as a potential recipient of the benefit and can ask the court to enforce this right

Answer 19

``` [T]here is no obligation on the trustees to do more than consider – from time to time, I suppose – the merits of such persons of the specified class as are known to them and, if they think fit, to give them something ```

Answer 20

one of my flats in her lifetime

Answer 21

Most lenient test donee does not acquire an interest in the property until he satisfies the relevant condition e.g. a gift of £500 to A provided that he passes his year one LLB examinations Re Allen - member of the CofE Re Barlow 'family and friends' - uncertain but valid

Answer 22

The trustees shall apply the net income of the fund in making at their absolute discretion grants to or for the benefit of any of the officers and employees or ex-officers or ex-employees of the company or to any relatives or dependants of any such persons in such amounts at such times and on such conditions (if any) as they think fit.

Answer 23

Power not a trust (apply test for certainty in CoA Re Gulbenkian)