Equity and trusts

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What does constituting a trust mean?
Constituting- transferring legal title to the trustee. Constituting the trust is vesting the trust property in the trustee
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What does it mean when a trust is completely constituted?
It means trust property is vested in the trustees. It is then binding on the settlor who cannot change his mind and revoke the trust. The beneficiaries have enforceable rights
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What happens if trust property is not properly vested in the trustees?
The trust is said to be incompletely constituted
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What happens if a trust is incompletely constituted and no consideration has been given
if no consideration is given for the incompletely constituted trust the trust is void (subject to exceptions)Equity will not assist a volunteer is generally applied
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What happens if a trust is incompletely constituted but consideration has been given
The incompletely constituted trust may be specifically enforced- equity regards as done that which ought to be done
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What are the requirements for validly disposing of your property after you die?
Must comply with section 9 of the Wills act 1837 1. in writing 2. signed by testator 3. two witnesses
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If you are creating a trust in your will how is it constituted
the trust is constituted by the will.As long as s9 of the will act 1837 is complied with no other constitution requirements for disposal of property on death (legal title is transferred by the will)
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For what type of dispositions do the rules on constitution become tricky
Lifetime dispositions inter vivos
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Milroy v Lord (on different ways a legal owner can dispose of his property)
1. outright gift must have intention, comply with legal requirements and means both titles go to donee.
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Milroy v Lord (on the different ways a legal owner can dispose himself of his property)
2. transfer on trust means legal title to trustee and benefiial title to beneficiary must comply with legal requirements and if land s53 1b LPA and 3 certainties as with any trust
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Milroy v Lord (on the different ways a legal owner can dispose himself of his property)
3. self declaration of trust legal title stays with settlor and beneficial title to beneficiary must have 3 certainties and comply with formalities
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How do you transfer legal title?
dependant on the type of property; shares in a uk company, chattels, bills of exchange, money and choses in action
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How can the legal title to chattels be transferred
1. deed or actual delivery as in re cole coupled with intention as in glaister carlaisle
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Re Cole
Not enough to just show intention you must also deliver it to the person if it is impractical you must do it by deed. Husband showed a table to wife and said its all yours darling it was held not enough to show intention also had to deliver property
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Glaister carlisle
An intention to transfer legal title must be clear an unequivocal husband and wife arguing and he threw her the dog. It was held the husband had not manifested a clear intention to transfer title of the poodle to the wife
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How must legal title to shares be transferred
stock transfer act 1963 sets out requirements- sign stock transfer form- must send stf along with share certificate- title passes on registration as the new shareholder
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Transferring legal title of shares at what point does the donee recieve legal title
at the point the company's registrar recieves the share certificate and stock transfer form from the transferor and registers the donor as the new shareholder
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how must legal title to land be transferred
s52 lpa by deed if creating a new trust of land you must also need to abide by s53 of the lpa 1b
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when transferring legal title to a cheque (bill of exchange) what must be done
Bills of exchange act 1882- cheques made in favour of the donor can be transferred to a 3rd party by the transferor endorsing the cheque
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what does it mean to endorse a cheque
method used for transferring legal title to the cheque to someone else sign name on the back of cheque
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when transferring the legal title to money how is this done
transferred by delivery cheque must clear for transfer to be completed. if the payer dies before it clears the payee has given no consideration and so it cannot be enforced
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Transferring legal title to choses in action what must be done
debts and other choses in action are transferred by writing, complying with s136 lpa 1925 notice must be given to the debtor
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to what does section 136 lpa apply
to transferring legal title to choses in action. 1 assignor must themselves write to the debtor to let them know the legal title is being transferred 2 the legal title passes on date the debtor receives the notice
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what are choses in action
covers debts, rights to claim damages, breach of contract etc
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what is the general rule with situations where legal title is not correctly transferred
Milroy v Lord- equity will not rescue the failed the trust or gift- equity will not perfect an imperfect gift will not assist a volunteer woll not treat an imperfect gift as a self declaration of trust
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what is the leading case which shows the rule that equity will not perfect an imperfect gift
Milroy v Lord
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Milroy v Lord
the settlor must have constituted the trust- there is no equity to perfect an imperfect gift. Highlights the vital importance of correctly transferring legal title. It also shows that if the legal title is not correctly transferred equity will ot res
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which case shows that the rule in milroy v lord also applies to failed gifts
jones v lock
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jones v lock
tried to argue a self declaration of trust however equity will not treat an imperfect gift as a self declaration of trust
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equity will not treat a failed gift as a self declaration of trust
the courts do not let this happen
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two cases show that a failed gift is not a self declaration of a trust
jones v lock and richards v delbridge
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milroy v lord have exceptions
1. point of no return if the settlor has not done enough but is past the point of no return. 2 pennington v waine where there has been reliance on the ineffective transfer 3 proprietary estoppel 4 death bed gift
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the leading case on the point of no return
re rose (applies to shares) mascall v mascall applies to land
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test in re rose
used correct method to make transfer. does all he can to make the transfer happen. the documents must end up with the registrar of the company and mascall extends this to land
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what is doing all that could be done
completed documents to be given to the person capable of effecting transfer of the legal title
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this test in re rose was adjusted by mascall v mascall
transfer uses the correct method. transferor need not have done all that he could but the transfer must be irrevocable by the transferor out of the transferor's hands
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to what types of property does the test in re rose apply
shares and land
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what is required for proprietary estoppel
promise or assurance and detrimental reliance
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gillet and holt as an exception to milroy v lord
C had acted to his detriment by dropping out of school, working on the farm for 40 years, C got the farm cottage
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Cain v moon ad leading case to death bed gift
contemplation of death, conditional gift on death delivery of the property
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if there isnt actual delivery there must be something which counts as representing title
sen v headley- keys to steel box containing deeds re weston post office savings book re beaumount cannot be used as cheque is revocable mandate
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strong v bird
released from a debt
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re stewart
applies to gifts
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re gonin
continuing intention
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Other cards in this set

Card 2

Front

It means trust property is vested in the trustees. It is then binding on the settlor who cannot change his mind and revoke the trust. The beneficiaries have enforceable rights

Back

What does it mean when a trust is completely constituted?

Card 3

Front

The trust is said to be incompletely constituted

Back

Preview of the back of card 3

Card 4

Front

if no consideration is given for the incompletely constituted trust the trust is void (subject to exceptions)Equity will not assist a volunteer is generally applied

Back

Preview of the back of card 4

Card 5

Front

The incompletely constituted trust may be specifically enforced- equity regards as done that which ought to be done

Back

Preview of the back of card 5
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