Trusts (CASES) Flashcards
Allan’s Trustees v Lord Advocate 1971
truster-as-trustee trusts were lawful
Hardie v Morrison (1899
- In the truster’s will he stated the idea to set up a shop which promoted “free thought”
- this confused the Courts and was HELD to be too vague
- the trust was no valid
‘Garden’s Executors v More 1913
- In this case the testator directed his trustees to convey certain assets to his wife
- He added that he would like not less than £50 to be left to the widow of his brother if she predeceases his wife
- He added that he desired his wife to make a settlement providing for this
- The wife inherited but later died without making any provision
HELD - the quoted words did not create a trust
Shaw’s Trs v Greenock Medical Aid Society 1930
‘Secret’ trusts are invalid
- In this case the trust was void due to uncertainty
- Gift of residue to husband as trustee to make payments to religious or benevolent societies
- the truster stating “regarding which he knows my mind”
- Trust purposes known only to the trustee and therefore invalid.
McCaig v UoG 1907’
As no specific beneficiaries were identified
- In this case the testator, in a holograph settlement, gave details of trustees and that revenue from his heritable property should be used to erect statues of himself and members of his family
- And, for artistic towers to be built on his estate
- He directed that his plan was to inspire young artists and prizes should be given to those with the best planned statues/towers
HELD - that by these purposes no beneficial interest was conferred upon any person
Melville v Noble’s trustees [1986]
Trustees were authorised to invest but did so improperly
- In this case trustees left money on a deposit receipt (at the time was reasonable way of ‘parking money on short term basis’
- money was left on for 19 years and was likely to be a poor investment
- The trustees had power to put money on deposit receipt but were HELD to be liable for not investing responsibly
Raes v Meek (1889)
- Case where trustees invested trust money in unfinished housing
- this turned out to be a high investment that went wrong
- the trustees were held to be personally liable
HELD - law requires of trustees the same degree of diligence that a man of ordinary prudence would exercise in management of his own affairs
The Magistrates and Town-Council of Aberdeen v The University of Aberdeen[1877]
Trustee must not use his position for personal advantage
- In this case the Council acted in a trust for the benefit of two UoA professors
- Trust property consisted of land
- The Council wanted land for themselves and proceeded to sell it at auction secretly to themselves
- They also obtained a lease of the Crown estate of the salmon fishing in the land which they sub-let
- UoA brought action against the Council 80 years later
HELD - Breach of trust, Council obliged to return land and any income accumulated over the time for the salmon fishing to the University.
Inglis v Inglis (1983)
Where trustee has power to exercise discretion - it should not be exercised in their own favour
- In this case it was held that an executor-dative could not transfer deceased interest as a tenant under a lease to himself as an individual
- The defender had acted as an actor in rem suam
Martin v City of Edinburgh 1988
- Defenders were trustees who allowed their political outlook to influence investment decisions
HELD - breach of trust, they was a conflict of interest between their duty as trustees and their political agenda
Scott v Occidental Petroleum (Caledonia) Ltd 1990
That a trustee cannot delegate their trust
- Can delegate administrative tasks to agents
- Cannot delegate where exercise of discretion or judgement is needed
Hood v MacDonald’s Trustee 1949
- Testator stated in will that his business was to be sold
- Testator left provision in will that A (“my present manager”) should be given first chance to purchase the business
- A worked for the testator between 1934-1941
- In 1947 an agent of the trust informed A of the legacy (£50 left to him) but not of the provision (to buy the business)
- The business had been sold in 1946 to the current manager
- A learnt of the provision and sued for damages of £2000 for breach of trust
HELD - this was a breach of trust as the trustees did not follow the terms of the trust deed
Heritable Reversionary Co Ltd v Millar 1891
- where a trustee has became bankrupt, the subjects he was holding as part of a trust would not vest in the trustee.
- Reason given is although he owns them they do not belong to him
Governors of Dollar Academy v Lord Advocate 1995
- Provided that trustees could insure themselves against personal liability
- It is also possible for premiums of the insurance to be charged to the trust fund if the trust deed so allows or the Court permits
Gilchrist’s Trs v Dick 1883’
A trustee who is in serious breach of trust can be removed by the court on the petition of the beneficiaries or co-trustees.
