Law of Trust: company shares essay PDF

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600 word essay on company shares, example essay focusing on company shares solely...

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N0865612 Simon Hammond intended to create a trust by transfer for his daughter Melissa Taylor, in respect of his holiday home. He seeks to appoint Colin Thompson and Brian Fletcher as the trustees. However, Simon dies unexpectedly and fails to sign the Stock Transfer Form. In his will, he appoints Colin and Brian as the executors. Primarily, in order to constitute a trust over company shares, there are two requirements, the execution of a stock transfer form and the registration of the new owner at the company. A stock transfer needs to be completed by the settlor under the Stock Transfer Act 1963 (STA)1 to transfer the shares, it requires the completion and execution of the form found in Schedule 12 and it needs to be given to the new owner with the existing share certificate. The new owner is then obligated to send the stock transfer form to the company to register and update the members under the Companies Act 20063 Simon had failed to sign the Stock Transfer Form which resulted in the company rejecting the paperwork and not updating the registration. therefore, legal title has not been transferred to the trustees as the trust was not consituted and wil fail unless equity assists. However, when a gift is not constituted, equity might intervene to save an imperfect gift. Re

Rose 19524 established that if the donor had exhausted all ways to transfer legal title but the transfer is delayed by the routine operation of the law, then the gift is still effective. Mascall v Mascall 19845 established that if the donor has exhausted all the ways to transfer legal title, then the title transfers. Simon hasn’t done everything in his power as he had forgotten to sign the stock transfer form and has failed to mention in his will that he wishes to gift the holiday home to his daughter. Although, in this scenario, the gift will be perfected by Strong v Bird 6 because an imperfect gift is perfected when the intended donee is appointed as the executor of the donors will, as long as the donor has the immediate intention to gift at the time of death. Simon had failed to sign the stock transfer form but he has an immediate intention to gift the holiday home to his daugther. Following the case, the gift to Colin and Brian of the house to hold for Melissa will be complete in equity; Colin and Brian were the intended trustees of the intervivious disposition, there was an immediate intention to create an intervivious disposition, there is a continuing intention up until the point of death and the trustees were appointed as the executor at death. In Simons will, the exectors appointed were Colin and Brain, the copy of the will clearly highlights this, when Simon died, the legal title automatically vested to 1 Stock transfer Act 1963, s.1 (1) 2 schedule 1 of Stock Transfer Act 1963 3 Companies Act 2006, s.771 4 Re Rose [1952] EWCA Civ 4 5 Mascall v Mascall [1984] EWCA Civ 10 Court of Appeal 6 Strong v Bird [1874] LR 18 Eq 315

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executives, therefore they have legal title to the shares, Strong and Bird will operate to save the gift....