Class participation wk12 PDF

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Week 12 in-class problem question answer...

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TUE 3-5pm tutorial

3. PROBLEM QUESTION CHARITABLE TRUSTS

The principle of resulting trust is derived from the Latin word 'resalire' meaning 'to jump back', it is therefore the creation of an implied trust by operation of law. Here, property is transferred to an individual who owes nothing for it and is implied to have held the property for benefit of another person. Resulting trusts must satisfy ‘certainty of subject’ and ‘certainty of object’. This is when A purchases a property but instructs the Vendor to place the property in the name of B, the Court will declare that B holds the property on resulting trust for A. The beneficial interest results in or goes back to the Settlor or the Purchaser. Resulting trusts arise because contributions have been made to the purchase of property, but the contributor has not been given a legal titles that is equivalent to that contribution. Under this, there are two categories most applicable to Abby is presumed resulting trusts. Equity presumed that the equivalent legal title is held of trust for the contributor. Such trusts arise when A purchases property in B’s name, or in this case A gives money to B to purchase property in B’s name and not consideration for the transaction is provided by B. If B can adduce evidence that A intended the money to be a gift and therefore had no intention that B hold the property on trusts for him, the presumption of the resulting trust will be rebutted. The onus of proving the contrary intention rests upon the person against whom the resulting trust is raised. However, in deciding upon the intentions of the parties the Court accepts both written evidence and evidence of conversations to prove the intentions of the parties at the time of the purchase. Therefore, it is clear that Bazza Murphy c/o Paris will have to prove in court that Fred indeed intended his first four will dispositions to be considered as a gift or donation therefore resulting in a rebuttable as then he had no intention on keeping a trustee. This will be very difficult in this matter as he has clearly stated in his will in dispositions 1, 2 and 3 his clear intentions with who will handle his trust and how the trustees will distribute his wealth. If the court finds his will unclear, they may refer to the case of Re Golay’s Will Trusts (1965) 2 All ER 660 where Mr Golay wrote a Will saying he wanted Mrs Bridgewater “to enjoy one of my flats during her lifetime and to receive a reasonable income from my other properties …”. The Will was challenged, and it was questioned whether the clause was certain enough to be enforced because it was not clear which flat or what income would be reasonable. The obiter dicta held in court by Thomas J stated the trust was sufficiently certain. “The Court is constantly involved in making such objective assessments of what is reasonable, and it is not to be deterred from doing so because subjective influences can never be wholly excluded. In my view the testator intended by “reasonable income” the yardstick which the Court could and would apply in quantifying the amount so that the direction in the Will is not in my view defeated by uncertainty.” This case provides that if there is no Beneficiary, the trustee holds legal title to the property free of any beneficial interest. Since equity will not allow the trustee to hold property intended to be the subject of a trust free of a beneficial interest, the equitable interest in the property will result back to the Settlor through a resulting trust....