Introduction

Question 1

What is a trust?

Answer 1

Two features

Equitable duty to hold or apply property for the benefit of perosns
The person whose benefit the property to be applied has an equitable propritary interest in that property

A trust ceases to exist if through no fault from trustee the propetry is destoryed or consumed.

Obligation component - trust must have trustee - owes equitable obligations to beneficary.
Trustee can never be one of the beneficaries.

Question 2

Key uses for trust?

Answer 2

Commercial purposes
Share ownership – publicly traded shares are held on trusts
Investment funds
Pension funds – delating payment individual and making use of expertise of fund managers
Other forms of tax-efficient employee remuneration corporate tax avoidance

Private arrangement

Question 3

Categories of trust?

Answer 3

Express trusts
- One deliberately created
Implied trusts – arise as a result of the operation of law
- Resulting trusts – less sophisticated – arise in limited situations – where legal owner has transferred ownership of their property to a third party but for some reason equity recognised that transferor should retain or regain beneficial interest in that property.
- Constructive trusts
o Institutional constructive trust – orthodox form of trust – because conscience of legal owner is affected in some way – preventing them from denying beneficial interest of another person. Automatically imposed in response of a qualifying event.
o Constructive trust as remedy – following a successful proprietary estoppel claim, when fiduciary makes a personal profit breach of no-profit rule, at the end of the tracing process.
- Common intention constructive trusts – used to resolve disputed over land occupied by unmarries cohabitees.
There are also
Statutory trusts
Testamentary trusts – ONLY CREATED BY WILLS
Inter vivos trusts – by self declaration or by a transfer on trust
Fixed and discretionary trust
Charitable purpose trusts

Trusts differ to contract – creation of equity – arise of intention of settlor
Differs from debts – where there is overlap it’s called a Qusitclose trust
Different from charges –
- Charger’s right to unencumber their charged property by paying the debt
Comparing it to bailment – like that of drycleaner
- Only tangible property
- Involve transfer of possession but not legal title