EXPRESS TRUSTS
WHAT IS A TRUST
Underhill
- ‘an equitable obligation, binding on a person to deal with property over which he has
control for the benefit of persons of whom he may himself be one, and any of whom may
enforce the obligation’
Keeton & Sheridan, the law of trusts
- The relationship which arises whenever a person called the trustee is compelled to hold
property whether real or personal and whether by legal or equitable title for the benefit of
some persons (of whom he may be one) or for some object permitted by law, in such a way
that the real benefit of the property accrues not to the trustee but to the beneficiaries or
other objects of the trust.’
CREATION OF EXPRESS TRUSTS: THE THREE CERTAINTIES
Chambers v Fahy 1931 IR 17
- In order that a trust may be created, the subject matter must be certain, the objects of the
trust must be certain and the words relied on creating the trust must have been used in an
imperative sense so as to show that the testator intends to create an obligation.’
1. CERTAINTY OF INTENTION
• Must be clear and imperative – shouldn’t leave any discretion to the trustees as to the
nature of what the relationship is
• Who is to take legal title and who is to take beneficial title? If the courts cannot distinguish
between the two, that means that it Is an absolute gift and the court will not perfect and
imperfect gift.
Watkin1
- ‘Must manifest an intention…must make it clear that the person or persons in whom the
subject-matter is to vest are only to take the legal title, and that the beneficial title is to vest in
others.’
- Must be clear to third parties, i.e. the courts
- ‘the test is whether such an intention is manifested by this particular settlor in these particular
circumstances; no formula or mode…is generally required’
- In reality there are 5 certainties – intention, beneficial interest, purpose of the trust, subject-
matter and beneficiaries who are to take the interest.
Lambe v Eames 1871
1
1 Watkin, Doubts and Certainties, (1979) Anglo-American Law Review. 123
, - Courts totally unwilling to deem precatory language (hope, desire, wish) as sufficient for
creating a trust
Re Adams & Kensington Vestry 1884 27 Ch 394
Testator left property to his wife by will:
‘in full confidence that she would do what was right’ for his children
- Precatory and does not indicate intention
Comiskey v Bowring Hanbury 1905
- In full confidence – sufficient declaration of trust
Difference:
- Later said that he directs that the property should be held on trust – goes from a moral
obligation not legally binding to certainty of intention sufficient to declare trust.
Re Humphrey’s Estate (1916) 1 IR 21
Testator left all his property to his wife and expressed a wish that she should leave a house to his
son and the remainder to his daughter (by her will or be transfer at some stage during lifetime)
- Not legally bound – mere wish – word used
- Intention not certain enough to amount to a trust – precatory language
- Look at will as a whole – no subsequent or other provision solidifying intention
- Took property absolutely
Re Blackwood 1953 NI 32
Testatrix appointed her brother-in-law executor and left to him her entire estate subject to the
payment of just debts and funeral and testamentary expenses, the words were:
‘absolutely in full trust and confidence that he will pay, apply and divide my said estate amongst my
friends and relatives (including himself) in accordance with my wishes.’
She did not make any further provision as to what those ‘wishes’ were.
On true construction of the will, trust created:
- ‘in accordance with my wishes’ implied a division of the trust property which the testatrix
could control with supplementary directions
- However, those terms had not been declared – the executor held the estate on resulting
trust for next-of-kin.
, - Precatory words = trust
Not a clear intention, to me
Re Coulson (1953) 87 ILT 93;
Testator left farm to cousin and said in the will:
‘it is my wish that the farm should not be sold or divided but it shall be kept by her for such one of her
children as she thinks suitable’
- Capable of being imperative, but the decisive factor is, ‘what could be gathered from the
will as a whole’
Via such analysis:
- Mere expression of hope to act in a certain manner.
- Received the interest absolutely
Re Sweeney (1976-77) ILRM 88
- In determining whether a trust is created, the courts will examine the substance and effect
of the word used in the context in which the settlor has used them – doesn’t require the use
of the word trust itself
- Affirmed Re Coulson & Re Humphreys – constructed as a whole.
- ‘After a devise and bequest in clear and explicit terms, if a trust is intended to be created
one would expect that this would be done in terms equally clear and explicit.’
- If the document is clear on other matters, lack of clarity as to intention to create a trust
negates the certainty of that intention
INCOMPLETE CONSTITUTION
Jones v Lock (1865) LR 1 Ch App 25
Father placed cheque into his sons hands and said ‘I give this to baby; it is for himself and I am going
to put it away for him, and will give him a great deal more along with it.’ Then took it back, and put it
away.
Died w the cheque in a safe. The expression of an intention to GIVE it to his son was evidenced by
the cheque itself, but whether the intention was to create a trust was less clear.
- Invalid declaration
Failed to sign the cheque, the father’s intention was an outright transfer.
- Equity will not perfect an imperfect/ incomplete gift through declaring a trust.
- ‘no doubt this testator intended to provide for his son either by settling this money or
leaving it to him by will, but his intention was never carried into effect.’
WHAT IS A TRUST
Underhill
- ‘an equitable obligation, binding on a person to deal with property over which he has
control for the benefit of persons of whom he may himself be one, and any of whom may
enforce the obligation’
Keeton & Sheridan, the law of trusts
- The relationship which arises whenever a person called the trustee is compelled to hold
property whether real or personal and whether by legal or equitable title for the benefit of
some persons (of whom he may be one) or for some object permitted by law, in such a way
that the real benefit of the property accrues not to the trustee but to the beneficiaries or
other objects of the trust.’
CREATION OF EXPRESS TRUSTS: THE THREE CERTAINTIES
Chambers v Fahy 1931 IR 17
- In order that a trust may be created, the subject matter must be certain, the objects of the
trust must be certain and the words relied on creating the trust must have been used in an
imperative sense so as to show that the testator intends to create an obligation.’
1. CERTAINTY OF INTENTION
• Must be clear and imperative – shouldn’t leave any discretion to the trustees as to the
nature of what the relationship is
• Who is to take legal title and who is to take beneficial title? If the courts cannot distinguish
between the two, that means that it Is an absolute gift and the court will not perfect and
imperfect gift.
Watkin1
- ‘Must manifest an intention…must make it clear that the person or persons in whom the
subject-matter is to vest are only to take the legal title, and that the beneficial title is to vest in
others.’
- Must be clear to third parties, i.e. the courts
- ‘the test is whether such an intention is manifested by this particular settlor in these particular
circumstances; no formula or mode…is generally required’
- In reality there are 5 certainties – intention, beneficial interest, purpose of the trust, subject-
matter and beneficiaries who are to take the interest.
Lambe v Eames 1871
1
1 Watkin, Doubts and Certainties, (1979) Anglo-American Law Review. 123
, - Courts totally unwilling to deem precatory language (hope, desire, wish) as sufficient for
creating a trust
Re Adams & Kensington Vestry 1884 27 Ch 394
Testator left property to his wife by will:
‘in full confidence that she would do what was right’ for his children
- Precatory and does not indicate intention
Comiskey v Bowring Hanbury 1905
- In full confidence – sufficient declaration of trust
Difference:
- Later said that he directs that the property should be held on trust – goes from a moral
obligation not legally binding to certainty of intention sufficient to declare trust.
Re Humphrey’s Estate (1916) 1 IR 21
Testator left all his property to his wife and expressed a wish that she should leave a house to his
son and the remainder to his daughter (by her will or be transfer at some stage during lifetime)
- Not legally bound – mere wish – word used
- Intention not certain enough to amount to a trust – precatory language
- Look at will as a whole – no subsequent or other provision solidifying intention
- Took property absolutely
Re Blackwood 1953 NI 32
Testatrix appointed her brother-in-law executor and left to him her entire estate subject to the
payment of just debts and funeral and testamentary expenses, the words were:
‘absolutely in full trust and confidence that he will pay, apply and divide my said estate amongst my
friends and relatives (including himself) in accordance with my wishes.’
She did not make any further provision as to what those ‘wishes’ were.
On true construction of the will, trust created:
- ‘in accordance with my wishes’ implied a division of the trust property which the testatrix
could control with supplementary directions
- However, those terms had not been declared – the executor held the estate on resulting
trust for next-of-kin.
, - Precatory words = trust
Not a clear intention, to me
Re Coulson (1953) 87 ILT 93;
Testator left farm to cousin and said in the will:
‘it is my wish that the farm should not be sold or divided but it shall be kept by her for such one of her
children as she thinks suitable’
- Capable of being imperative, but the decisive factor is, ‘what could be gathered from the
will as a whole’
Via such analysis:
- Mere expression of hope to act in a certain manner.
- Received the interest absolutely
Re Sweeney (1976-77) ILRM 88
- In determining whether a trust is created, the courts will examine the substance and effect
of the word used in the context in which the settlor has used them – doesn’t require the use
of the word trust itself
- Affirmed Re Coulson & Re Humphreys – constructed as a whole.
- ‘After a devise and bequest in clear and explicit terms, if a trust is intended to be created
one would expect that this would be done in terms equally clear and explicit.’
- If the document is clear on other matters, lack of clarity as to intention to create a trust
negates the certainty of that intention
INCOMPLETE CONSTITUTION
Jones v Lock (1865) LR 1 Ch App 25
Father placed cheque into his sons hands and said ‘I give this to baby; it is for himself and I am going
to put it away for him, and will give him a great deal more along with it.’ Then took it back, and put it
away.
Died w the cheque in a safe. The expression of an intention to GIVE it to his son was evidenced by
the cheque itself, but whether the intention was to create a trust was less clear.
- Invalid declaration
Failed to sign the cheque, the father’s intention was an outright transfer.
- Equity will not perfect an imperfect/ incomplete gift through declaring a trust.
- ‘no doubt this testator intended to provide for his son either by settling this money or
leaving it to him by will, but his intention was never carried into effect.’
