Constituting a Trust

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  • Created by: vikell
  • Created on: 17-11-19 22:18
What does constituting a trust mean?
Transferring legal title to the trustee. Constituting the trust is vesting the trust property in the trustee.
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What are inter vivos trusts?
A legal document created while the individual for which the trust is drawn up is still living.
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What is a testamentary trust?
This is created when an individual dies and the trust is detailed in their last will and testament.
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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.
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What are the key principles of Milroy v Lord
1. A court of equity will not perfect an imperfect gift 2. A court of equity will not assist a volunteer
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3 ways to give away property...
1. Gift 2. Sale 3. Trust
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Methods for benefiting another with property according to Milroy v Lord...
1. Gift 2. Transfer on trust 3. Self-declaration as a trustee
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Two ways of constituting a trust
1. Transfer of property to trustee 2. Self-declaration of trust
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Two methods of constituting a trust
1. Self declaration 2. Transfer of legal title to trustees
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Three requirements for constituting a trust
1. Certainty 2. Formalities 3. Constitution
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Why is it important to constitute a trust?
Otherwise beneficiaries have no rights; cannot enforce trust
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Strong v Bird
Exception may operate where; Donor promises to make inter vivos gift to donee... Donor dies before constituting/vesting legal title in donee... AND after donor's death, donee receives property in capacity as executor of donor's will
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What does S v B rule provide an exception for?
That transferee needs to do all required to complete gift during lifetime
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According to Strong v Bird, the gift will be regarded as...
Perfected
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What are the requirements in Strong v Bird?
1. Intention 2. Continuation of intention 3. Vesting of property in donee
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The intention requirement in Strong v Bird requires the gift to be...
Immediate
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The intention requirement in Strong v Bird requires the gift to be what kind of property?
Specific
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What is an incomplete constituted trust also known as?
An imperfect trust
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Re Gonin
The donee/daughter was appointed administrator of her mother's estate. She claimed the house using the rule in Bird v Strong. It failed, because it could not be shown that the mother intended for the daughter to have the house.
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Re Stewart
Donee need not be the sole executor/executrix
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Cain v Moon
Sets out three conditions for a valid Donationes mortis causa
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What are the three conditions for a valid DMC according to Cain v Moon?
1. Gift made in contemplation of impending death 2. Donor must deliver subject matter of gift to donee 3. Gift must be conditional on impending death
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What is a Donatio mortis causa?
A gift made by a person (the donor) in contemplation of impending death
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When are DMC's effective
On death
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Re Craven's Estate
The death must be within the near future
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Is the contemplated cause of death have to be the actual cause of death for the DMC to be sufficient?
No. Does not matter donor's death results from cause other than that contemplated.
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What is 'deliver subject matter of gift' or 'delivery of dominion' mean
Dominion= a) subject matter; OR b) means of accessing subject matter; OR c) documents evidencing entitlement to possession of the subject matter
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Reddel v Dobree
The donor retained and exercised the right to take back the box, therefore there was no DMC.
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Birch v Treasury Solicitor
It was held where the subject matter of the gift is bulky in nature, the handling to the donee of a key to the box or place where the thing is kept would be sufficient to constitute delivery. It is not to be regarded as merely symbolic.
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What is an indicia of title?
Generally, a document evidencing title to property, real or personal
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Can land be subject matter of DMC?
No. Per Duffield v Elwes
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Re Bowden
A constitution of a typical trust requires irrevocable disposition of beneficial interest in property.
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Requirements for absolute gift...
1. Intention to make a gift 2. Effective transfer of property from donor to donee
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Other cards in this set

Card 2

Front

A legal document created while the individual for which the trust is drawn up is still living.

Back

What are inter vivos trusts?

Card 3

Front

This is created when an individual dies and the trust is detailed in their last will and testament.

Back

Preview of the back of card 3

Card 4

Front

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.

Back

Preview of the back of card 4

Card 5

Front

1. A court of equity will not perfect an imperfect gift 2. A court of equity will not assist a volunteer

Back

Preview of the back of card 5
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