FLK2 Resulting Trusts Trusts
Implied Trusts – arise through the application of legal principles (not the settlors instructions).
Resulting Trusts – implied trusts that are
PRESUMED to arise whether there is a transfer of property but no clear intention regarding who should have
beneficial interest; OR
Arise automatically where a trust is declared but fails (no identifiable beneficiary)
When property is transferred to someone without any money changing hands, but it’s unclear who has the
beneficial interest = resulting trusts show up.
No formalities required! 😮
Presumptions
If Ellie transfers property for free to Steven without setting up an express trust who owns the property?
The law uses presumptions to figure out the implications of a transfer of property
The Law will presume a resulting trust has arisen where:
1. Voluntary transfers of personalty (personal property that is not land)
If Ellie gives personalty to Simon for free a rebuttable presumption of resulting trust arises.
The courts presume a resulting trust arises, so Simon holds the legal title, and Ellie has the equitable
interest. (Ellie holds the property on resulting trust for Simon)
2. Voluntary transfers of land
Uncommon with land. Interpreted there should be no trust in voluntary transfers of land Ali v Khan
2002
A resulting trust can emerge if there is additional evidence
3. In purchase money cases (a person pays for a property but arranges for title to be in someone else’s
name.)
It must occur at the same time as the purchase
Implied Trusts – arise through the application of legal principles (not the settlors instructions).
Resulting Trusts – implied trusts that are
PRESUMED to arise whether there is a transfer of property but no clear intention regarding who should have
beneficial interest; OR
Arise automatically where a trust is declared but fails (no identifiable beneficiary)
When property is transferred to someone without any money changing hands, but it’s unclear who has the
beneficial interest = resulting trusts show up.
No formalities required! 😮
Presumptions
If Ellie transfers property for free to Steven without setting up an express trust who owns the property?
The law uses presumptions to figure out the implications of a transfer of property
The Law will presume a resulting trust has arisen where:
1. Voluntary transfers of personalty (personal property that is not land)
If Ellie gives personalty to Simon for free a rebuttable presumption of resulting trust arises.
The courts presume a resulting trust arises, so Simon holds the legal title, and Ellie has the equitable
interest. (Ellie holds the property on resulting trust for Simon)
2. Voluntary transfers of land
Uncommon with land. Interpreted there should be no trust in voluntary transfers of land Ali v Khan
2002
A resulting trust can emerge if there is additional evidence
3. In purchase money cases (a person pays for a property but arranges for title to be in someone else’s
name.)
It must occur at the same time as the purchase
