Equity LG/WS 1 What is a trust?

  • Created by: Emma13
  • Created on: 21-06-18 17:45
Why should the law enforce trusts?
Fundamental point of equity - certain relationships = morally right to enforce. Equitable "Do what ought to be done"
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What is the definition of a trust and authority?
Underhill and Hayton - Equitable obligation (duty) imposed on a trustee, to deal with property over which he has control, for the benefit of beneficiaries who can enforce the obligation
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What is a settlor?
Person who creates a trust in his/her lifetime, to take effect in their lifetime
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What is a testator/ testatrix?
Person who makes a will, may contain a trust but makes a will
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What is a trustee?
Holding property put into trust
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What is trust property?
Assets put into trust (inc intangible assets)
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What are trustee duties?
Duties of trustees
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What are beneficiaries ?
Person for whom the trust property is held
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How do you create a trust?
Creation of trust requires 2 steps: The settlor must make a declaration of trust (trust doc/instrument/deed) and the settlor must transfer the trust property to the trustee (trust fund/capital) = trust exists
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What does a trust declaration do?
Appoints trustees, states that trustees are/ to hold trust and define the trust property, identified beneficiaries, nature and extent of their equitable interests, varies duties and powers
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What does running a trust include?
Trustees owe duties; investment of trust property, act in best interest of bens, keep account of trust property
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What can constitute a breach of trust?
Failing: Duty to act in best interest of all beneficiaries, duty to distribute trust property according to the terms of the trust, remedies include compensation
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What is a contingent trust?
Where the beneficiaries not entitled to anything unless they satisfy conditions
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What is a successive interest trust?
Trust for life, only entitled to income not the capital
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What is a discretionary trust?
No fixed beneficiaries, have a class, gives to whoever needs it most - letter of wishes for guidance
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What did Re Astors Settlement establish?
Trust established purely for the purpose was invalid
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What is a charitable trust?
Except to the general principle, the trust must be charitable in law/ character. List of charitable purposes in s3 Charities Act 2011
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How do lottery syndicates work?
Rather than entering as a single individual, many people come together to pool together their resources to increase their chances of winning. Collecting stakes from members, person holding the wining ticket will hold the winnings on trust for others
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What is a unit trust?
A management company, acting as a trustee, takes subscription from their client and other individual investors, allocated units in trust assets in proportion to sums contributed. Management comp responsible for investment decisions,investors have ben
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What is a pension scheme?
Individuals pay into a collective investment fund managed by t'ee, knowing that they will receive better returns than if they each attempted to invest individually
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What is an unincorporated association?
Clubs and societies that are not incorporated companies can't own property since lack legal personality. Where assets invested in committee members on behalf of members of club, they are trustees. Management of property = UA
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What is the distinct characteristic of pension schemes?
Pension schemes are not established by generosity of setlor, result of contractual obligation which both employee and employer are contractually obliged to make. Ben's help to finance own benefits
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What is a purpose trust?
A purpose trust is a trust which has no beneficiaries, instead exists for advancing some non-charitable purpose of some kind
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What are 3 requirements for a purpose trust to be charitable?
Charitable character - prima facie charitable, listed in Act, Public benefit and organisations activities must be exclusively charitable
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Other cards in this set

Card 2

Front

What is the definition of a trust and authority?

Back

Underhill and Hayton - Equitable obligation (duty) imposed on a trustee, to deal with property over which he has control, for the benefit of beneficiaries who can enforce the obligation

Card 3

Front

What is a settlor?

Back

Preview of the front of card 3

Card 4

Front

What is a testator/ testatrix?

Back

Preview of the front of card 4

Card 5

Front

What is a trustee?

Back

Preview of the front of card 5
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