CERTAINTY OF SUBJECT MATTER
Certainty of subject matter identifies not only the property itself, but also its nature, description,
identity and certainty of the beneficial share and failing these, the trust will be void
Nature of the subject matter
Asks what type of property can constitute trust property (typically money, shares, covenants,
debts)
Don King Productions v Warren [1998]- even though a purported assignment of a
contract for personal services would be ineffective at law, this would not prevent a trust
of the benefit of the contract being declared, assuming the intention to do so could be so
identified
Swift v Dairywise Farms [2000]- recognised that milk quotas that exempt the holder of
the quota from a financial levy or tax of some description can be held on trust
Description/definition of subject matter
A declaration of a trust can be valid only if the subject matter of that trust has been described
with sufficient clarity (on a question of fact)
Palmer v Simmonds [1854] used the phrase ‘bulk of my residuary estate’, which was not
determined to not be sufficiently certain
By contrast, specifying that someone will receive ‘all of the residuary estate’ is not
generally considered to be uncertain
Not trust arose in Sprange v Barnard [1789] as the testatrix providing that property
would be left to her husband to use absolutely but that ‘the remaining part of what is left’
(that he did not want) was to be held on defined trusts was too uncertain
It was not certain at the time of creation what, if anything, could be held on trust so it
was viewed absolutely as a gift
Also called into question what the testatrix actually intended and the judge viewed that it
was a trust that was impossible to execute, as there was no way of knowing if there
would be anything left
Where subject matter of the trust relates to what is left of the property after the trustee’s death
(as in Sprange), there is not an immediate trust of property due to uncertainty at the time of
creation
However, this may be circumvented through a floating/suspended trust which crystallises
on the trustee’s death
For example, A leaves £1,000 in her will, with an obligation on B to leave what is left of
this money on trust to C (to take effect when B dies)
Recognised only in the specific context of secret trusts (Ottaway v Norman [1972])
The use of the words ‘anything that is left’ in Re Last [1958] was clear enough to give rise to a
trust
The use of ‘residue’ will not fail for lack of certainty of subject matter, as although it is unclear
what precisely they will get at the outset, the description is clear enough to show that they will
be getting something (Pearson v Lehman Brothers Finance SA [2010])
Unlike ‘bulk’, ‘residue’ itself is a certain term as the embodiment of all those things that
you will get if the property is not distributed
Provision for ‘reasonable income’ (entitling Mrs F to ‘enjoy one of my flats during her lifetime
and to receive a reasonable income from my other properties’) was certain as the court could
determine what was objectively reasonable in the circumstances
Certainty of subject matter identifies not only the property itself, but also its nature, description,
identity and certainty of the beneficial share and failing these, the trust will be void
Nature of the subject matter
Asks what type of property can constitute trust property (typically money, shares, covenants,
debts)
Don King Productions v Warren [1998]- even though a purported assignment of a
contract for personal services would be ineffective at law, this would not prevent a trust
of the benefit of the contract being declared, assuming the intention to do so could be so
identified
Swift v Dairywise Farms [2000]- recognised that milk quotas that exempt the holder of
the quota from a financial levy or tax of some description can be held on trust
Description/definition of subject matter
A declaration of a trust can be valid only if the subject matter of that trust has been described
with sufficient clarity (on a question of fact)
Palmer v Simmonds [1854] used the phrase ‘bulk of my residuary estate’, which was not
determined to not be sufficiently certain
By contrast, specifying that someone will receive ‘all of the residuary estate’ is not
generally considered to be uncertain
Not trust arose in Sprange v Barnard [1789] as the testatrix providing that property
would be left to her husband to use absolutely but that ‘the remaining part of what is left’
(that he did not want) was to be held on defined trusts was too uncertain
It was not certain at the time of creation what, if anything, could be held on trust so it
was viewed absolutely as a gift
Also called into question what the testatrix actually intended and the judge viewed that it
was a trust that was impossible to execute, as there was no way of knowing if there
would be anything left
Where subject matter of the trust relates to what is left of the property after the trustee’s death
(as in Sprange), there is not an immediate trust of property due to uncertainty at the time of
creation
However, this may be circumvented through a floating/suspended trust which crystallises
on the trustee’s death
For example, A leaves £1,000 in her will, with an obligation on B to leave what is left of
this money on trust to C (to take effect when B dies)
Recognised only in the specific context of secret trusts (Ottaway v Norman [1972])
The use of the words ‘anything that is left’ in Re Last [1958] was clear enough to give rise to a
trust
The use of ‘residue’ will not fail for lack of certainty of subject matter, as although it is unclear
what precisely they will get at the outset, the description is clear enough to show that they will
be getting something (Pearson v Lehman Brothers Finance SA [2010])
Unlike ‘bulk’, ‘residue’ itself is a certain term as the embodiment of all those things that
you will get if the property is not distributed
Provision for ‘reasonable income’ (entitling Mrs F to ‘enjoy one of my flats during her lifetime
and to receive a reasonable income from my other properties’) was certain as the court could
determine what was objectively reasonable in the circumstances
