Certainty of Objects
*-In order for a trust, or a power, to exist there have to be beneficiaries (objects) who are
certain or capable of being certain such that there is someone in whose favour the courts can
enforce the trust.
-The general requirements:
1) There must be human beneficiaries (with the exclusion of charitable trusts).
2) The beneficiaries must be:
a) Identified Individually; or
b) Identified as members of a clearly defined class (i.e. “my employees” or “my
children”).
*-The description of the beneficiaries must, as regards both fixed and discretionary trusts, be
conceptually certain at the time the trust is created.
1) Fixed Trusts
*-A fixed trust is one where both the identity and the interests of the beneficiaries are set out
in the trust instrument.
a) Conceptual Certainty
Re Endcott [1960]: A testator left money to the local council, “for the purpose of providing
some suitable monument to myself”.
Held: The trust failed also for lack of conceptual certainty as it was unclear as to what
“suitable” encompassed.
1) The Complete List Test
*-Complete List Test: A fixed trust is void unless each and every beneficiary is ascertainable
by the trustee drawing up an exhaustive list of the beneficiaries. If the trustee cannot compile
such a comprehensive catalogue, the trust must fail (IRC v Broadway [1955]).
*OT Computers Ltd v First National Tricity Finance Ltd [2003]: In 2002, OT Computers
instructed its bank to open two separate trust accounts for the payment of customer deposits
and moneys owed to “urgent suppliers”. The claimant compiled two schedules: one
containing the names of the customers and the other listing a number of its suppliers. On the
claimant going into receivership, the bank sought to discharge a loan due to it from the
money in the two accounts.
Held (Legal Principle):
1) Trust for customer deposits was upheld because the beneficiaries could be identified.
2) Trust in favour of the suppliers failed because of a lack of certainty of objects as the
term “urgent” was too conceptually uncertain to identify any class of beneficiary.
Re Benjamin [1902]: A fixed trust created in circumstances where it is unclear if a particular
beneficiary is or is not still alive, the court can authorise the trustees to distribute the trust
property amongst the known beneficiaries on the assumption that the beneficiary is dead.
*-In order for a trust, or a power, to exist there have to be beneficiaries (objects) who are
certain or capable of being certain such that there is someone in whose favour the courts can
enforce the trust.
-The general requirements:
1) There must be human beneficiaries (with the exclusion of charitable trusts).
2) The beneficiaries must be:
a) Identified Individually; or
b) Identified as members of a clearly defined class (i.e. “my employees” or “my
children”).
*-The description of the beneficiaries must, as regards both fixed and discretionary trusts, be
conceptually certain at the time the trust is created.
1) Fixed Trusts
*-A fixed trust is one where both the identity and the interests of the beneficiaries are set out
in the trust instrument.
a) Conceptual Certainty
Re Endcott [1960]: A testator left money to the local council, “for the purpose of providing
some suitable monument to myself”.
Held: The trust failed also for lack of conceptual certainty as it was unclear as to what
“suitable” encompassed.
1) The Complete List Test
*-Complete List Test: A fixed trust is void unless each and every beneficiary is ascertainable
by the trustee drawing up an exhaustive list of the beneficiaries. If the trustee cannot compile
such a comprehensive catalogue, the trust must fail (IRC v Broadway [1955]).
*OT Computers Ltd v First National Tricity Finance Ltd [2003]: In 2002, OT Computers
instructed its bank to open two separate trust accounts for the payment of customer deposits
and moneys owed to “urgent suppliers”. The claimant compiled two schedules: one
containing the names of the customers and the other listing a number of its suppliers. On the
claimant going into receivership, the bank sought to discharge a loan due to it from the
money in the two accounts.
Held (Legal Principle):
1) Trust for customer deposits was upheld because the beneficiaries could be identified.
2) Trust in favour of the suppliers failed because of a lack of certainty of objects as the
term “urgent” was too conceptually uncertain to identify any class of beneficiary.
Re Benjamin [1902]: A fixed trust created in circumstances where it is unclear if a particular
beneficiary is or is not still alive, the court can authorise the trustees to distribute the trust
property amongst the known beneficiaries on the assumption that the beneficiary is dead.
