TRUSTS Flashcards
What are the 3 certainties
Intention
Subject Matter
Objects
Certainty of intention
Conduct not just words
Precatory words
Use of the word ‘trust
Certainty of subject matter
Identify the property
Quantum each beneficiary is to receive
Certainty of Objects
Who is the beneficiary?
Who can enforce the trust?
Which case said the use of word ‘trust’ is not necessarily conclusive in C of intention
Tito v Waddell (No 2) [1977]
“Trust in the higher sense”
A non-enforceable government obligation
Who said: a trust can be created by the most untechnical of words
MAITLAND
What sort of intention is needed?
Not a general intent to benefit but a specific intent to benefit by way of trust
What are precatory words
Words accompanying a gift expressing hope, faith, desire, request or confidence that it will be used in a certain way
What context do precatory words normally occur in
Typically occur in context of a will
eg Legacy to wife in confidence that…
What did JAMES LJ say in LAMBE 1871
In hearing case after case cited, I could not help feeling that the officious kindness of the Court of Chancery in interposing trusts where in many cases the father of the family never meant to create trusts, must have been a very cruel kindness indeed”
Cases for the modern approach to precatory words
Re Adams & Kensington Vestry (1884)
Comiskey V Bowring-Hanbury [1905]
Re Adams & Kensington Vestry (1884)
- H left property to W ‘in full confidence that will do what is right… between my chlidren’
- Held it was a trust
Comiskey V Bowring-Hanbury [1905]
- “in full confidence that“on her death“she will devise it to…one or more of my nieces.”
- There was gift over clause to nieces in default of appointment providing for equal division
- HL (4 v 1) held gift not absolute but imposed a trust
Three aspects of certainty of subject matter
- Quantum each beneficiary is to receive?
- Identifying the property subject to the trust?
- Future property
Degree of certainty required in identifying beneficiaries’ shares?
Not necessary in a discretionary trusts
Needed under a fixed trust
Cases for fixed trust degree of certainty in identifying beneficiaries’ shares?
BOYCE 1849
PALMER v SIMMONDS 1954
Re GOLAY 1965
BOYCE 1849
- Left one of 2 houses to Maria
- ‘Whichever she may think proper to chose’ and the other to her sister
- Trust failed due to lack of certainty
PALMER v SIMMONDS 1854
- ‘The bulk of my estate’
- Again failed due to lack of certainty
Re GOLAY 1965
- ‘To let Tussy… receive a reasonable income from my properties’
- Again failed due to lack of certainty of object -> identifying the property in the trust
3 Cases for precision required in identifying the property in the trust
Re LONDON WINE 1986
Re GOLDCORP 1994
HUNTER v MOSS 1994
Re LONDON WINE 1986
- Customers bought wine but did not take possession. - Stored in company’s warehouse.
- Company went into receivership. Trustees appointed. Were bottles subject to trust?
- Court: No. Customers could not identify specific bottles of wine.
Re GOLDCORP 1994
- Gold company went bankrupt. Co lacked enough assets to satisfy its debts.
- Who gets the gold? Customers or bank?
- Court: Bank, because the gold wasn’t identified.
HUNTER v MOSS 1994
- Moss told Hunter that he would hold 5% of shares of his company on trust for H. - H then sued for the shares.
- High Court: No need to segregate. All the shares are identical.
- Court of Appeal: No need to segregate because the shares are intangible.
-> If thing is intangible then it can’t be claimed precisely so need not be segregated
Certainty of objects & the beneficiary principle
MORICE v BISHOP OF DURHAM
MORICE v BISHOP OF DURHAM
“Every [non-charitable] trust must have a definite object. There must be somebody in whose favour the court can decree performance
