Three Certainties

Question 1

Three Certainties

Answer 1

Knight v Knight:
Certainty of intention
Certainty of subject matter
Certainty of object

Question 2

Certainty of intention - word “trust” is not necessary; “equity looks to the intent rather than the form”

Answer 2

Re Kayford

Question 3

Modern approach is lean against finding a trust where precatory words are used

Answer 3

Lambe v Eames

Question 4

“In full confidence that she will do what is right” - no trust; wife took property absolutely

Answer 4

Re Adams

Question 5

“In full confidence that she will make use of it as I should have myself… I hereby direct that all be estate shall be divided.” - sufficiently clear intention to create a trust

Answer 5

Comiskey v Bowring-Hanbury

Question 6

Certainty of intention - must look at whole trust instrument, not just key phrases

Answer 6

Re Hamilton

Question 7

Man told cohabitant that his money was “as much hers as his” - discussions on numerous occasions constituted an express declaration of trust, though no specific moment of declaration could be pinpointed

Answer 7

Paul v Constance

Question 8

Trust cannot arise if relevant langauge reveals that the payer intended a debtor-creditor relationship to arise

Answer 8

Azam v Iqbal

Question 9

Company that pays customer’s money into separate bank account to protect the money shows sufficient intention = trust

Answer 9

Re Kayford

Question 10

Certainty of subject matter

Answer 10

Certainty of property and certainty of beneficial entitlement

Question 11

“£300 for his sole use and at his death the remaining part of what is left, that he does not want for his own want and use” - no certainty of subject matter

Answer 11

Sprange v Bernard - subject matter must be certain at the point of creation

Question 12

“anything that is left” - uncertain

Answer 12

In the Estate of Last

Question 13

Wording of letter showed intention to declare a trust

Answer 13

Shah v Shah

Question 14

“The bulk of my estate” - uncertain

Answer 14

Palmer v Simmonds

Question 15

Trust of an unidentified section of intangible property (e.g. shares) is valid

Answer 15

Hunter v Moss

Question 16

Testator left houses to trustees on trust for wife for life, and then after death on trust to Maria, whichever house she chose and all the other houses to his other daughter. Maria died in testator’s lifetime - void for uncertainty

Answer 16

Boyce v Boyce

Question 17

Direction to allow beneficiary “to enjoy one of my flats during her lifetime and to receive a reasonable income from the others” - trustees could select a flat (certainty arguable); a “reasonable income” was not uncertain - trust upheld

Answer 17

Re Golay’s Will Trusts

Question 18

Buyers of wine in a warehouse could not establish a trust as the bottles had not been segregated or identified in any way

Answer 18

Re London Wine Co - a trust of an unidentified section of chattels will fail

Question 19

Purchasers of bullion could not claim rights to it, save for one group whose bullion had been segregated

Answer 19

Re Goldcorp Exchange

Question 20

If purported trust granted onto a gift, donee takes gift absolutely

Answer 20

Sprange v Bernard; Palmer v Simmonds

Question 21

If beneficial interests are uncertain, there will be a resulting trust

Answer 21

Boyce v Boyce

Question 22

Certainty of objects - a trust must be for ascertainable beneficiaries

Answer 22

Morice v Bishop of Durham

Question 23

An invalid trust will not be construed as a power

Answer 23

Re Shaw

Question 24

Power of appointment is valid if it can be said with certainty whether any given individual is or is not a member of the class, and does not fail because it is impossible to ascertain every member of the class

Answer 24

Re Gulbenkian’s Settlement Trusts

Question 25

Power to appoint income among ‘deserving’ relatives void for uncertainty, though power to appoint income for scholarships for ‘promising’ relatives upheld

Answer 25

Public Trustee v Butler

Question 26

Fixed Interest trusts (each beneficiary has definable interest) - it must be possible to draw up a complete list of all the beneficiaries

Answer 26

IRC v Broadway Cottages Trust

Question 27

Discretionary trusts - test for certainty of objects is the is/is not test; equal division not often the most appropriate method. No need for complete list as beneficiaries are not guaranteed to receive anything. Only conception certainty required

Answer 27

McPhail v Doulton

Question 28

Re Baden’s Deed Trusts (No 2)

Answer 28

Megaw LJ - ‘substantial number’ of beneficiaries in class, even if not all identified

Sachs LJ - once established that class is conceptually certain, each claimant must prove he is within the class;

Stamp LJ - must know exactly who is in and who is out; narrowed meaning of ‘relatives’ to next of kin

Question 29

a trust for the inhabitants of West Yorkshire was administratively unworkable, without hte court deciding whether it was conceptually certain

Answer 29

R v District Auditor ex p West Yorkshire Metropolitan County Council

Question 30

A power cannot be uncertain merely because it is too wide in ambit

Answer 30

Re Manistry’s Settlement

Question 31

If part of the object is uncertain, courts may sever

Answer 31

Re Leek -but not always appropriate

Question 32

Gift subject to condition precedent is valid if it is possible to say of one or more persons that he/they qualify although it may be difficult to say whether others qualify or not

Answer 32

Re Allen

Question 33

Pictures on trust for sale subject to a direction that “all or any of my family and friends who wish to do so, may purchase any such pictures” - gift subject to condition precedent

Answer 33

Re Barlow’s WT: direction valid as anyone who could prove that he was a friend of the testatrix would be entitled to exercise that option; if it had been a discretionary trust, “friends” would have been too uncertain

(Only High Court)

Question 34

Discretionary trust or power for “friends” void for uncertainty as you cannot lay down precise requirements for friendship

Answer 34

Re Gulbenkian’s ST