As Lord Wilberforce in McPhail v Doulton appears to imply the size of a class of
beneficiaries can make a trust administratively unworkable and thus invalid. This is
essentially one of Lord Wilberforce's three types of uncertainty, which also include
linguistic or semantic uncertainty and whereabouts uncertainty. This essay aims to
examine Lord Wilberforce's meaning in the given quote, as well as the legal
proposition of whether administrative workability or related concepts such as
capriciousness and evidential certainty, if applicable, will be vitiating factors in the
voiding of a trust.
In light of this, it's important to emphasise McPhail facts didn’t fell within the
category of a 'definition of beneficiaries' being 'hopelessly wide'. McPhail concerned
a deed which has term(Clause 9(a)) involved a trust that provided for 'the officers or
ex-officers and employees or ex-employees of the company, or to any relatives or
dependents of any such persons...'. The question of whether Clause 9(a) imposed a
trust or merely power. The test of trust at the time was complete list test, which
stated "a trust for such members of a specified class of objects as trustees should
select is void for uncertainty, only if entire range of objects entitled for selection is
ascertained or able for ascertainment," as stated in Inland Revenue Commissioners v
Broadway Cottages Trusts. The reasoning applying this test to trusts was a trust must
be one that court can control and able to distribute the property equally if trustees
fail to execute. As Lord Eldon stated in Morice v Bishop of Durham, "Court must
control the execution of trust" and "the administration can be reviewed by Court".
In McPhail, the courts held the clause imposed a discretionary trust rather mere
power, but they did not apply complete list test. Rather, House of Lords stated
"revolutionary" decision, ruling that test to apply should be similar to Re
Gulbenkian's Settlement, concerned power of appointment and courts
provided that appropriate test is the "is or is not" test: "if there is some particular
person at hand say to be benefited that he is fairly within the class then the clause is
good".
The case was subsequently remitted to High Court to determine whether the trust
was valid under the is or is not test and the case was eventually appealed to the
Court of Appeal as Re Baden's Deed Trusts (No 2). When judges attempted to define
'relatives', problems arose since this would be a huge class that would nearly
impossible to identify and categorise, when searched in broad historical terms, as JE
Penner pointed out. Stamp LJ, on the other hand, relied on another authority that
defined "relatives" as next of kin and thereby skipped the above mentioned issue,
allowing the trust to be valid.
Returning to Lord Wilberforce's statement, it could be said that it is quite ambiguous
in terms of the definition and circumstances that would fall under the category of 'so
hopelessly wide' and not forming 'anything like a class'. After all, Lord Wilberforce
had only given one example. According to the grammar of his quote, the meaning of
the beneficiaries' class must be clear and not too broad, but according to Penner, 'all
the residents of Greater London' is not vague, thus this could not be what Lord
Wilberforce intended to say. Indeed, it may be argued this isn't Lord Wilberforce's
beneficiaries can make a trust administratively unworkable and thus invalid. This is
essentially one of Lord Wilberforce's three types of uncertainty, which also include
linguistic or semantic uncertainty and whereabouts uncertainty. This essay aims to
examine Lord Wilberforce's meaning in the given quote, as well as the legal
proposition of whether administrative workability or related concepts such as
capriciousness and evidential certainty, if applicable, will be vitiating factors in the
voiding of a trust.
In light of this, it's important to emphasise McPhail facts didn’t fell within the
category of a 'definition of beneficiaries' being 'hopelessly wide'. McPhail concerned
a deed which has term(Clause 9(a)) involved a trust that provided for 'the officers or
ex-officers and employees or ex-employees of the company, or to any relatives or
dependents of any such persons...'. The question of whether Clause 9(a) imposed a
trust or merely power. The test of trust at the time was complete list test, which
stated "a trust for such members of a specified class of objects as trustees should
select is void for uncertainty, only if entire range of objects entitled for selection is
ascertained or able for ascertainment," as stated in Inland Revenue Commissioners v
Broadway Cottages Trusts. The reasoning applying this test to trusts was a trust must
be one that court can control and able to distribute the property equally if trustees
fail to execute. As Lord Eldon stated in Morice v Bishop of Durham, "Court must
control the execution of trust" and "the administration can be reviewed by Court".
In McPhail, the courts held the clause imposed a discretionary trust rather mere
power, but they did not apply complete list test. Rather, House of Lords stated
"revolutionary" decision, ruling that test to apply should be similar to Re
Gulbenkian's Settlement, concerned power of appointment and courts
provided that appropriate test is the "is or is not" test: "if there is some particular
person at hand say to be benefited that he is fairly within the class then the clause is
good".
The case was subsequently remitted to High Court to determine whether the trust
was valid under the is or is not test and the case was eventually appealed to the
Court of Appeal as Re Baden's Deed Trusts (No 2). When judges attempted to define
'relatives', problems arose since this would be a huge class that would nearly
impossible to identify and categorise, when searched in broad historical terms, as JE
Penner pointed out. Stamp LJ, on the other hand, relied on another authority that
defined "relatives" as next of kin and thereby skipped the above mentioned issue,
allowing the trust to be valid.
Returning to Lord Wilberforce's statement, it could be said that it is quite ambiguous
in terms of the definition and circumstances that would fall under the category of 'so
hopelessly wide' and not forming 'anything like a class'. After all, Lord Wilberforce
had only given one example. According to the grammar of his quote, the meaning of
the beneficiaries' class must be clear and not too broad, but according to Penner, 'all
the residents of Greater London' is not vague, thus this could not be what Lord
Wilberforce intended to say. Indeed, it may be argued this isn't Lord Wilberforce's
