What is the effect of a trust that fails for uncertainty of object?

Question 1

When will a trust be void?

Answer 1

A trust will be void if the ‘objects’ (beneficiaries) of that trust are uncertain.

Question 2

Why do we need certainty of object?

Answer 2

The principles dealing with the certainty of objects relate to the need for the trustees to be able to know the identity of the beneficiary to fulfil their obligations and also the court needs to be able to identify the beneficiary to determine whether the trustee has exercised their powers properly (IRC v Broadway Cottages (1955)).

Question 3

What are the two tests for object of a trust and what types of trust?

Answer 3

There are two tests that pertain to the object of a trust: a fixed trust relies on the fixed list test (IRC v Broadway Cottages (1955)) and a discretionary trust relies on the any given postulant test (McPhail v Doulton (1971)).

Question 4

What happens if these tests fail?

Answer 4

If either of these tests fail, then the object (beneficiary) of the trust is uncertain and the trust must fail (Morris v Bishop of Durham (1804)).

Question 5

What is the result of a failed trust?

Answer 5

This means that, although the intention and subject of the trust is certain, the object is not, so the beneficiary cannot benefit from the property, the trustee cannot keep it and thus the property must go back to the settlor on resulting trust.