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Express Trust Checklist 1

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Express Trust Checklist 1 THE ELEMENTS OF A TRUST ARE: 1. Subject of a trust (ie trust property) 2. Trustee (person who holds property legally for the benefit of someone else 3. Object of a trust (ie beneficiary) Express Trust Checklist 1. Is it a trust? Is there intention/is it a gift? Confirm the type of trust. 2. Three certainties (Knight v Knight): i. Certainty of intention Byrnes v Kendle ii. Certainty of subject Hunter v Moss, Herdegen v FCT iii. Certainty of object/beneficiary 3. What kind of trust is it? Two categories: i. Fixed Trust ii. Discretionary Trust - Trust with trust power (must be exercised) - Trust with bare power (authorised but not obliged) 4. Complete Constitution (trust property/subject is completely transferred from the testator/settlor to the trustee, who holds it for the benefit of the beneficiary) 5. Formalities i. Is writing required? (LPA s29) ii. Can it be assigned at law? (Land, goods, choses in action) iii. If not at law, can it be assigned in equity? (Milroy v Lord, Corin v Patton) iv. Has all been done that is required to be done (Corin v Patton) 6. Conclusion REAL PROPERTY ACT 1886 - SECT 67—Instruments not effectual until registration Legal Relationship Trust Other Relationship Fixed Discretionary List Certainty Bare Power Trust Power Criterion Certainty (with extra Criterion Certainty qualification) since 1971 Resulting Trust Checklist 1) What are the legal interests in the property? i. If it is real property cite s 67 RPA. 2) RT will be presumed in the following circumstances: i. Failure of an express trust ii. Surplus trust property once an express trust has been terminated iii. On purchase of property (important between family/business relationships) iv. Quistclose trust (can be classified same as category 1). 3) What are the equitable interests in the property? 4) Has the presumption been rebutted? i. By the presumption of advancement? (ie presumed to be a gift) ii. Is it a joint tenancy of a matrimonial home? Cummins v Cummins iii. Is there contrary intention? (Also consider Sui Mei Huen) 5) Was there a gift? i. Gifts of personalty do not give rise to RT – unless produces income 6) Conclusion Relevant at the time of acquisition of property. - Eg a couple buy a property, pay purchase price differently – then resulting trust is relevant. It is important who paid what. Intention at time of acquisition (presumed) RT is an institution - not discretionary. Nature of relationship at time of acquisition Manner of acquisition at time of acquisition Law of Property Act 1936 (SA): 29—Instruments required to be in writing (1) Subject to the provisions hereinafter contained with respect to the creation of interests in land by parol— (a) no interest in land can be created or disposed of except by writing signed by the person creating or conveying the same, or by his agent thereunto lawfully authorised in writing, or by will, or by operation of law; (b) a declaration of trust respecting any land or any interest therein must be manifested and proved by some writing signed by some person who is able to declare such trust or by his will; (c) a disposition of an equitable interest or trust subsisting at the time of the disposition must be in writing signed by the person disposing of the same, or by his agent thereunto lawfully authorised in writing or by will. (2) This section shall not affect the creation or operation of resulting, implied, or constructive trusts. Constructive Trust Checklist 1) Firstly go through RT and rebuttals 2) Then CT takes it back to equitable interests - What contributions to mutual security and benefit did the parties make? Relevant after acquisition. Apply Baumgartner i. Financial contributions such as renovations/mortgage repayments ii. In kind - No for Bryson v Bryant (NSW) – love and affection - Yes for Parij (SA) – relevance to property (ie looking after children) iii. Any increase in value since purchase is likely to be 50:50 (Muschinski v Dodds) iv. If living together for a long time is likely to be 50:50 (Baumgartner) 3) Has someone died? i. Legislation does not apply in cases of death 4) Conclusion Relevant any time – who did what, who worked, saved etc. Intention is irrelevant (except common intention) CT is not necessarily subject to all the fiduciary obligations Nature of a relationship at any time Can be an institution or a remedy imposed by courts at their discretion. The law will act when it is unconscionable of the party holding all or part of the legal title to refuse to recognise the claim of equitable interest being put forward by another party. The presumption of a RT can be displaced by imposition of a CT .
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