Constitution

Question 1

Settlor must vest the trust property in the trustees

Answer 1

Milroy v Lord - once property vests, trust is binding and irrevocable whether or not consideration given by beneficiaries

Question 2

If trust property is not vested in trustees, the trust is improperly constituted.

Answer 2

If no consideration given, it is void.
Equity will not compel the settlor to correctly constitute the trust (to perfect an imperfect gift) as equity will not assist a volunteer - Milroy v Lord

If consideration given, may be SP

Question 3

Transferring land

Answer 3

s52(1) LPA;
- transfer must be in a deed (Richards v Delbridge); s1 LPMPA - written, signed, witnessed, describes itself as a deed, delivered

Legal title doesn’t pass until registration

Deed must be used to grant a lease over 3 years or to assign any lease

To transfer a subsisting equitable interest in land, s53(1)(c) must be followed

Question 4

Transfer of shares in a UK incorporated company

Answer 4

Stock Transfer Act 1963 - shares must be transferred by transferor signing a stock transfer form in favour of the transferee.

Transfer must be registered in the share register of the company - title only passes on registration of transferee as new shareholder

With shares of a public limited company, directors may not refuse to register the transfer, but directors of a private company may be able to under provisions in their articles of association - Re Rose

Question 5

Transfer of Chattels

Answer 5

• by deed of gift or actual delivery, accompanied by transferor intending to transfer them - Re Cole

Question 6

Bills of Exchange

Answer 6

Cheques made in favour of the transferor may be transferred to a third party by the transferor endorsing the cheque (e.g. signing his name on the back) - Bills of Exchange Act 1882; Jones v Lock

Question 7

Transfer of Money

Answer 7

Money is transferred by delivery; writing a cheque does not transfer the money until the cheque has been cleared. If the payer dies before the cheque has been cleared, his death countermands the instructions to the bank. If the payee has given no consideration, he cannot enforce payment.

Question 8

Choses in action (dents and rights under a bank account)

Answer 8

Transferred by writing complying with s136 LPA - notice in writing given to debtor/other party

Question 9

Transfer of equitable interests

Answer 9

s53(1)(c) LPA

Question 10

Where settlor intends to create a settlement by transfer but fails to vest the legal estate in the trustees, equity will not interpret that transaction as a declaration of trust

Answer 10

Milroy v Lord

Question 11

If donor intended an absolute gift, but failed to effectively transfer the property, equity will not construe the failed gift as a declaration of trust

Answer 11

Jones v Lock - failed to endorse cheque - no trust as intended as gift

Question 12

endorsed lease but not legally assigned - attempted transfer could not be construed as a declaration of trust because it was intended as a gift

Answer 12

Richards v Delbridge

Question 13

Letter referring to transfer of shares upheld as declaration of trust, not gift, as it referred to the transferor “holding” shares and described the letter as a declaration. Transfer forms and registration only completed at a later date - trust took effect until the transfer of legal title by registration

Answer 13

Shah v Shah

Question 14

Donor orally declared intention to make gift on trust to charity, but died before legal title transferred. PC upheld gift as donor was one of the trustees of the charity

Answer 14

T. Choithram International v Lalibai

Question 15

Where a transferor has done everything within his power, equity may regard the transfer as complete

Answer 15

Re Rose - transfer forms and share certifications delivered to transferees, but directors did not register the transfer for 3 months - transfers were effective once Mr Rose had done everything in his power to vest the shares in the transferees

Question 16

Re Rose extended - once all the relevant documents had been executed and the transfer stamped and handed to the transferee (but before registration), the gift was viewed as complete in equity

Answer 16

Mascall v Mascall

Question 17

Owner of absolute equitable interest had not done everything in his power as he had not handed over the share certificate, even though he had handed over a signed share transfer form

Answer 17

Zeital v Kaye

Question 18

A signed share transfer form and gave it to P (A’s agent); A told H she wanted him to become a director; H took on benefits and burdens of being a director. CA upheld gift in equity even though form not delivered to donee or company as it would have been unconscionable to recall the gift (subjective test)

Answer 18

Pennington v Waine (never successfully argued since)

Question 19

Proprietary estoppel may be used to perfect an imperfect gift where there is assurance, reliance and detriment so that it would be unconscionable to go back on the assurance

Answer 19

Thorner v Major

Question 20

Where donor intends to make gift during lifetime, but fails to vest legal estate in donee, gift may be perfected if legal title vests in donee as personal representative, provided donor had a continuing intention to make the gift up until death

Answer 20

Strong v Bird

Question 21

Personal representative rule does not apply to intentions to make a gift in the future as a promise is not legally enforceable

Answer 21

Re Freeland - must be intention to make immediate gift

Question 22

Personal representative rules applies if donee is sole executor or one of several

Answer 22

Sole - Strong v Bird

One of several - Re Stewart

Question 23

Personal representative rules applies where donee becomes an administrator on the intestacy of the donor

Answer 23

Re James

Question 24

Suggested that trust would become constituted if the trust property came into the trustee’s hands in any legitimate way (here, X was trustee of both trusts)

Answer 24

Re Ralli

BUT lack of intention; ignore Re Brooks’ ST (bad decision but never been overruled)

Question 25

Donatio mortis causa

Answer 25

Cain v Moon:

• gift made in contemplation of death, which the donor believes to be imminent
• gift is conditional on death
• there is delivery of the property

Then, if the gift is imperfect, the donee may insist on it being perfected

Question 26

Terminally ill man told a woman that the house was hers and that the deeds were in a steel box, he gave her the keys to it - valid DMC by constructive delivery of the title deeds

Answer 26

Sen v Headley

Question 27

Savings accounts can be the subject of a dmc by handing over the savings account book or bank deposit book

Answer 27

Savings account book - Re Weston

Bank deposit book - Birch v Treasury Solicitor