Trusts

Question 1

What is a trust?

Answer 1

A trust is a legal agreement between two parties. The trustee and the beneficary, the trustee has legal ownership of the land but is obligated to use it for the benefit of the beneficiary

Question 2

What is the trust property

Answer 2

Property held by the trust. Can be land, money etc.

Question 3

Who is the beneficiary?

Answer 3

The beneficiary is the one who the trust has been created for, they have a legal right to be benefit from the trust property.

Question 4

Who is the trustee?

Answer 4

The trustee is the one who has been passed legal ownership of the trust property, they have a duty of care/fiduciary duty over the land to ensure it benefits the beneficiary.

Question 5

What is the trust instrument?

Answer 5

Legal document that establishes the rights of the beneficiary and the fudiciary/powers of the trustee. Essentially the duty they owe the trustee.

Question 6

What is the settlor?

Answer 6

The settlor transfers the legal title of the trust property to another.

Question 7

What can a trust do?

Answer 7

-Divide property to different people
-Split control/ownership
-Manage land - e.g., provide access or preserve the trust property for future generations.

Question 8

Consequences of beneficiary equittable

Answer 8

• Beneficiary can transfer their beneficial interest to others
  -Beneficiary can collectively bring the trust to an end.

Question 9

Does a trust need an intention?

Answer 9

-There must be an intention to create the trust, it cannot be a gift.

Question 10

What is an express trust?

Answer 10

An express trust occurs when the settlor or person creating the trust explicitely states their intention to create the trust through a written legal document

Question 11

What is an implied trust?

Answer 11

An implied trust is created through the implied actions of the parties involved, an implication that the parties intended to create the trust.

Question 12

What are the key components of the certainty of subject matter?

Answer 12

• The property must be indentifiable
  -Described with sufficient clarity.
  -Certainity as to the benefit of it

Question 13

What is the beneficiary principle?

Answer 13

For a trust to be valid, it must benefit specific individuals that can clearly be identified.

Question 14

What does equity not recognise?

Answer 14

The creation of a trust for general purposes without indentifiable beneficaries.

Question 15

What is the trustee required by the court to do?

Answer 15

Ordered by the court to manage the property in a way that respects the right of someone else

Question 16

How are equitable rights established?

Answer 16

Equittable rights are established through legal disputes where someone asserts their rights against the legal owner of the property.
-Trustees fiduciary duties are tied with the beneficaries, if a trustee cannot assert their rights, they might not have obligations to fulfil for the benefit of the trust property.

Question 17

Reasons why a trust might not be valid

Answer 17

• Uncertainty of objects - Where the beneficiary of a trust are not clearly identified or are two vague for the trust to be administed e.g., ‘ for charitable purposes’.

Question 18

What does a trust need in order to be valid?

Answer 18

• Beneficaries must be clear and identifiable, if they are uncertain then trust may fail (uncertainity of objects)

Question 19

What is the beneficiary principle?

Answer 19

States that for a trust to be exist/be valid it must be enforceable
- Need someone with sufficient interest in enforcing the trust which would be the owner of the trust (the beneficiary)
-Therefore trust must be for persons