Certainty of Objects

1)      the essential test of certainty

A fixed trust is a trust under which the trustees are required to distribute the trust property to the beneficiaries in the proportions identified by the trust document. Consequently, it must be possible to identify who all the beneficiaries are (IRC v Broadway Cottages Trust [1955]). This is known as the complete list test.

2)      whether it is possible to define with sufficient certainty the description of the class (conceptual certainty)

If the definition of the object is unclear, it will not be possible to compile a complete list, so the trust will be void. Hence, a fixed trust for the settlor’s friends will be void for conceptual uncertainty, because it is not possible to find clearly who is a friend.

3)      The ease of proving that somebody is an object (evidential certainty)

Even if the definition of the objects is certain, if it is not possible to prove who the objects are, the complete list test will not be satisfied. For example, previous school football team members may fail the test if no records are available.

1)      ascertaining where an object of the class is located

It does not matter that the location or continued existence of a particular beneficiary cannot be established. The property will be distributed amongst those who can be ascertained and the share of anybody who cannot be ascertained be paid into court (Re Gulbenkian [1970])

2)      size of the class

No evidence that this is a relevant consideration when determining the validity of a fixed trust. By its nature, the class of fixed trusts tend to be small.

3)      test of capriciousness

No evidence to suggest that this is of any relevance to fixed trusts.

1.       The Essential Test of Certainty

The fixed trust can also arise where the trustees are obliged to distribute trust property to beneficiaries subject to whether or not a particular condition of been satisfied. The condition must be certain. The test of certainty varies depending on whether the condition is a condition precedent, which needs to be satisfied before the property can be distributed, or a condition subsequent, if the condition is satisfied a beneficiary will no longer be entitled to trust property.

A – Condition Subsequent

A condition subsequent will only be valid if it can be known with certainty from the start the exact event that will result in the defeat of the beneficiaries interest (Clavering v Ellison [1859]). If this cannot be established, the condition will be void (Clayton v Ramsden [1943]). These conditions are interpreted very strictly, for example a relationship between two people is uncertain as it may extent even standing next in a bus queue or it may be intimate in nature (Re Jones [1953]).

B – Condition Precedent

A condition precedent will be valid if it can be said of just one person that he or she satisfies the condition (Re Barlows WT [1979]). The onus is placed on the object to show that he or she satisfies the condition.

2.     

1.       Conceptual certainty

Re Tucks ST [1978] recognise that conceptual uncertainty would not render a condition precedent void, whereas it would invalidate a condition subsequent. The better view is that conceptual uncertainty will under any condition ineffective, either as a matter of law or simply in practice.

2.       Evidential certainty

Since the burden of proving that the condition is satisfied is borne by the object, evidential uncertainty will not invalidate the condition, it simply means that the condition cannot be shown to have been satisfied by that particular object.

3.       Ascertaining Location of Objects

The fact that an object cannot be ascertained will not invalidate the condition, since the object needs to establish that the condition has been satisfied. If no object can be ascertained, the condition will lapse in the property will pass to those entitled to the residue

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.       Size of class

Since the burden is placed on the object to establish that the condition is satisfied, it is difficult to conceive that a fixed trusts subject to such a condition will be administratively unworkable from the perspective of the trustee, by virtue of the size of class.

5.       Capriciousness

Although there was no authority on this point, presumably if the condition can be characterised as capricious, in the sense of the said law testator had no sensible intent from posing it, the condition should be disregarded.

1.       The Essential Test of Certainty

In a DT, the trustees are given a discretion as to which objects are to be benefited by distribution of trust property and in what proportion. In order for the power to be exercised, it is essential that the trustees know from the outset to the potential beneficiaries might be. If this is unclear the trust will be void for uncertainty (Sprange v Barnard [1789]). McPhail [1971] rejected the complete list test for discretionary trusts. This is because if the trustees failed to exercise the discretion, the court will be willing to find a solution to the problem without resorting to the maxim that equity is equality.

The test, coming from Lord Wilberforce, is called the any given postulant test. It is sufficient that it can be said with certainty that any given individual was or was not a member of the relevant class, it is not necessary to ascertain everybody inside that class (McPhail v Doulton [1971]). 

1.       Conceptual Certainty

The test will not be satisfied if it is not possible to define the description of the class with sufficient clarity (McPhail).

2.       Evidential Certainty - Stamp LJ concluded that the test of evidential certainty required is to be shown of any given person that he or she either was or was not within the class (Re Barden No 2 [1973]). The trust should consequently be held to be void for uncertainty of objects, unless it is possible to resolve evidential uncertainty. This approach places the evidential burden on the potential object, who is in the best position to bear it. His exclusion would not prevent anybody else improving that he or she falls in the class of objects.

3.       Ascertaining Location of Objects - The inability to ascertain the location of an object does not invalidate the trust, it simply means that that person cannot receive a distribution from the trust (McPhail)

4.       Size of Class - If the class of objects is so wide that it cannot be considered to be anything like a class, the trust will be considered to be administratively unworkable and so void (Ex P West Yorkshire Metropolitan CC [1986])

5.       Capriciousness - A DT may be void for Capriciousness (Ex P WYMCC [1986]). No DT has been invalidated on these grounds though.

1.       The Essential Test of Certainty - The test is if it can be determined that any individual was or was not a member of the class (Re Gulbenkian). Both the trustees and the court must be able to determine who are and who are not the objects of the power.

2.       Conceptual Certainty & 3.   Evidential Certainty 4.   Ascertaining Location of Objects - As with DT.

5.       Size of Class - FP cannot be struck down simply for breadth of class (Re Hay ST [1982]).

6.       Capriciousness - Applies if no discernible link with the settlor (Re Manistay [1974])