Trusts and co-ownership

  • Created by: jesskeayy
  • Created on: 04-05-19 17:53
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  • Trusts and co-ownership
    • Settlor transfers legal title of the beneficiary and is subject to obligations: 1. trust obligations, 2. fiduciary obligations, 3. obligations of care and skill
    • Beneficiary has an equitable interest in the trust property which is capable of binding third parties
    • Law of Property Act 1925
      • S.53(1)(b) a declaration of trust respecting any land/ interest therein must be manifested/ proved by some writing signed by some person who's able to declare such trust
      • S.53(2) section covers does not affect the creation or operating of resulting... or resulting trusts
      • S.1(6), s34(1), s.36 Law of Property Act 1925
        • Right of survivorship, must have 4 unities 1. possession, 2. interest, 3. title, 4. time
        • Max 4 joint tenants, s.34(2) LPA 1925
        • S.1(6) LPA 1925- can't be held by a minor
      • 1925 SCHEMA- limited estates/ interests in land that can exist at law: s.1(1) and s.1(2)
        • All other estates and interests in land take effect as equitable interests: s.1(3)
        • s.33 Land Registration Act 2002- beneficial interests behind the curtain
        • LPA 1925- premised on 'trust for sale'. Immediate duty to sell with a power to postpone the sale
          • Doctrine of conversion: beneficial interest conceived as personally i.e. interest in proceeds of sale
    • Trusts of Land and Appointment of Trustees Act 1996
      • trust of land defined as any trust of property incl. land (s,1(1))
        • Abolition of doctrine of conversion (s.3)
        • trusts for sale converted into trust of land (s.4)
      • S.14(1) any person who's a trustee of land or has an interest in property subject to a trust of land may make an application to courts
        • S.2(a) relating to the exercise by the trustees of any of their functions or (b) declaring the nature or extent of a person's interest in property subject to the trust, as the court sees fit
      • S.15(1) the matters to which the court is to have regard in determining application for an order under s.14 include
        • (a) the interests of the bankrupt creditors, (b) where the application is made in respect of land which is the home of the bankrupt's spouse
          • (I) the conduct of the spouse so far as contributing to the bankruptcy  (ii) needs/ financial resources of the spouse, (iii) needs of any children
          • (c) circumstances of the case other than needs of the bankrupt party
    • LPA 1925 introductions:
      • 2 trustee rule: beneficial interests are overreached when a sale by 2 trustees under s.2 and s.27
      • Beneficial interest only binds when it's an overriding interest under sch 3 para 2 LRA 2002
        • Boland (1980) Flegg (1988)
        • Sch 3 para 2 LRA 2002: interest belonging at the time of the disposition to a person in actual occupation, so far as relating to land of which he is in actual occupation, except for-
          • (b) an interest of a person whom inquiry was made before disposition and who failed to disclose the right when he could reasonably have been expected to do so;
            • (c) an interest which: 1. belongs to a person whose occupation would not have been obvious one  reasonably careful  inspection of land at the time
              • 2. of which the person to whom the disposition is made does not have actual knowledge at the time

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