Three Certainties

Question 1

Any declaration of trust must satisfy the three certainties of intention, subject matter and objects

Answer 1

Knight v Knights

Question 2

The use of the term ‘trust’ is not necessary to create a trust

Answer 2

Re Kayford
What is required is
- imperative wording
- an intention to create a legally binding obligation

Question 3

The intention is defined by looking at

Answer 3

both the words and the content of the settlors

Question 4

An instrument of trust cannot be used to perpetrate a fraud e.g. a Sham Trust

Answer 4

Hitch v Stone

Question 5

Percatory words do not always create a trust

Answer 5

The courts look to various aspects to determine the ‘true intention of the settlor’

Question 6

Intention: the relationship between the potential trustee and the beneficiary

Answer 6

Re Adams and Kensington Vestry

Question 7

Intention: How does the intention appear in the context of the entire will?

Answer 7

Re Hamilton

Question 8

Intention: the mandatory nature of the instruction

Answer 8

Comiskey v Bowring

Question 9

‘she knows what she has to do’ was too vague to demonstrate intention

Answer 9

Kasperbauer v Griffiths

Question 10

‘Knowing his wishes’ and ‘giving what is appropriate’ were too vague.

Answer 10

Margulies v Margulies

Question 11

‘to be at her disposal, in any way that she may think best for herself and her family’ was held to be a gift rather than a trust

Answer 11

Lambe v Eames

Question 12

‘I direct that all my estate shall be divided equally’ was sufficiently certainty, as the language was imperative.

Answer 12

Comiskey v Bowring-Hanbury

Question 13

Conduct can be sufficient to demonstrate intention, in this case sharing lottery winnings.

Answer 13

Paul v Constance

Question 14

If there is no intention to create a trust

Answer 14

It will usually be a gift to the donee

Question 15

The main distinction between a trust and powers are

Answer 15

• Trusts are imperative and powers are discretionary
• Trusts are enforced while powers do not have to be exercised.
• Powers do not fail for administrative unworkability, while trusts may do.

Question 16

Powers may be given to trustees:

Answer 16

• As either a fiduciary or non-fiduciary capacity
• Independently of a trust instrument or can be given as part of the trust
• If as part of the trust, typically this is a power of appointment.

Question 17

The property subject to the trust and the size of the beneficiaries shares in it must be certain.

Answer 17

Sprange v Barnard

- Certainty of Subject

Question 18

The property subject to the trust must be clearly defined

Answer 18

Palmer v Simmonds - ‘the bulk of my estate’ (Subjective and unclear)
Re Golay - ‘a reasonable income’ (objectively definable so certain
Sprange v Barnard - ‘whatever is left’

Question 19

Where the trust property is selected from tangible property it must be possible to identify and segregate off that specific property intended

Answer 19

Re London Wine

Question 20

If the property involved is intangible the subject matter will be sufficiently certain without the specific shares having to be segregated

Answer 20

Hunter v Moss

Lehman Brothers

Question 21

The beneficial entitlement must be capable of determination within fixed trusts.

Answer 21

Boyce v Boyce

Question 22

If the declaration of trust lack certainty of subject matter

Answer 22

The property will be treated as an absolute gift - if the property has not been properly defined
It will returned back to the estate by way of resulting trust - if the beneficial interest cannot be determined.

Question 23

The Persons for whom the trust is intended must be certainly known

Answer 23

Morice v Bishop of Durham

Question 24

Fixed Trusts

Answer 24

Where the proportions of property for each beneficiary are set

Question 25

Fixed trusts require both conceptual and evidential certainty - the 'complete list test'

Answer 25

IRC v Broadway | i.e. you need to list or be able to list ALL beneficiaries that are supposed to benefit from the trust.

Question 26

Discretionary Trusts and Powers

Answer 26

Where the proportions are decided at the trustees' discretion

Question 27

Discretionary trusts only require conceptual certainty | - the is/ is not test

Answer 27

``` Re Gulbenkian i.e. it must be ascertainable whether any given person is or is not a member of the class of objects ```

Question 28

'relatives' in the context of 'evidential certainty' in discretionary trusts.

Answer 28

Sachs LJ in Re Baden No.2 | - they must prove that they are a relative

Question 29

Curing conceptual uncertainty

Answer 29

- using the dictionary definition - delegation - reconstruction of the instrument

Question 30

Delegation to a third Party to cure uncertainty

Answer 30

Re Tuck's Settlement

Question 31

Construing the instrument as something other than a trust e.g. a gift subject to a condition precedent

Answer 31

Re Barlow's Will Trust

Question 32

Even a conceptually and evidentially certain trust could still fail for administrative unworkability

Answer 32

``` ex p West Yorkshire - a class of 2.5. million people was too large for a trust to work. ```

Question 33

If conceptual uncertainty cannot be cures

Answer 33

The trust WILL FAIL

Question 34

Evidential uncertainty

Answer 34

The words used to describe the criteria for the beneficiaries are clear enough that we cannot prove that some of the individuals satisfy the criteria or not. e.g. a child of the settlor who has lost his brith certificate

Question 35

Effects fo Evidential uncertainty

Answer 35

- does not typically invalidate the trust - Reversal of the burden fo proof: it is for the benficiary to prove who they are and not for the trustee to do so (Re Baden No.2)

Question 36

Ascertain-ability of Beneficiaries

Answer 36

Location - We know who they are but we cannot find them - this does not typically invalidate the trust

Question 37

Administrative unworkability and capricioussness

Answer 37

Re West Yorkshire MCC

Question 38

Powers are vlid if it can be said with certainty whether any given individual is or is not a member of the class and does not fail simply because ti is impossible to ascertain every member of the class.

Answer 38

Lord Wilberforce in Re Gulbenkian

Question 39

'Deserving' persons was held to be too uncertain in terms to define a class of persons

Answer 39

Public Trustee v Butler

Question 40

Gifts subject to a condition precedent | e.g. each of my friends can have a piece of my furniture

Answer 40

The least strict test Even friends is sufficiently certain because only reasonable evidence is required. Re Barlow's

Question 41

Certain intention but and uncertain subject matter

Answer 41

Trust is void (Palmer v Simmonds)

Question 42

Certain subject matter but uncertain intention

Answer 42

A gift to the trustee (Re Adams)

Question 43

Uncertain object

Answer 43

A resulting trust beck to the settlor (Vandervell v IRC)

Question 44

Where there is more than one certainty missing

Answer 44

The trust will fail | - void

Question 45

'to enjoy one of my flats during her lifetime and to receive a reasonable income from my other properties'

Answer 45

Re Golay's Trust | - found to be sufficiently certain.

Question 46

Trust 'for such persons as the company may consider to have a moral claim on the settlor'.

Answer 46

Re Leek | - No problem with this clause, depended on who the trustees believed to have a moral claim