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equity & trusts(quick question)
okay this concerns non-charitable purpose trusts.
usually question will ask us to consider the validity of certain disposition like
i) £800 for his grave once a year, "for as long as the money lasts"
"for as long as the money lasts"- what's this supposed to mean ? how to address this issue, just state it has to comply with the perpetuity rule ?
or care for an animal, "for the rest of her days"....it's the same I assume.
Btw, the perpetuity period allowed by law is 21 years right..? hm
hope someone answers me quickly hehe
usually question will ask us to consider the validity of certain disposition like
i) £800 for his grave once a year, "for as long as the money lasts"
"for as long as the money lasts"- what's this supposed to mean ? how to address this issue, just state it has to comply with the perpetuity rule ?
or care for an animal, "for the rest of her days"....it's the same I assume.
Btw, the perpetuity period allowed by law is 21 years right..? hm
hope someone answers me quickly hehe
Perpetuities indeed. Purpose trusts are bound by rule against perpetuities, if they will not vest within the perpetuity period then the gift will be void.
My approach would be to state firstly the law:
- Purpose trusts are not valid except for a few cases, one being testementary trusts - pure purpose trusts
- In those cases the rules against perpetuities applys.
- One rule is that there cannot be remoteness of vesting, hence there is a perpetuity period which is either: lives in being + 21 years, or 80 years.
- If the gift won't vest within the perpetuity period then it will be void for perpetuity.
Then apply it to the facts:
-This is a pure purpose trust therefore subject to the rules against perpetuities
- According to my reading of Pirbright v Salwey the perpetuity period is 21 years as his phrase isn't precise as to the period of time and is therefore akin to the testators use in Pirbright of 'for as long as the law allows'
- Then work out when the trust will be able to be wound up. Is there a limited amout of money for caring of the grave, or is it just out of the income from trust property? If the former it could be valid, if the latter, probably not and so the trust fails for perpetuity.
I HOPE THIS IS RIGHT, I HAVE THE SAME EXAM TOMORROW!
My approach would be to state firstly the law:
- Purpose trusts are not valid except for a few cases, one being testementary trusts - pure purpose trusts
- In those cases the rules against perpetuities applys.
- One rule is that there cannot be remoteness of vesting, hence there is a perpetuity period which is either: lives in being + 21 years, or 80 years.
- If the gift won't vest within the perpetuity period then it will be void for perpetuity.
Then apply it to the facts:
-This is a pure purpose trust therefore subject to the rules against perpetuities
- According to my reading of Pirbright v Salwey the perpetuity period is 21 years as his phrase isn't precise as to the period of time and is therefore akin to the testators use in Pirbright of 'for as long as the law allows'
- Then work out when the trust will be able to be wound up. Is there a limited amout of money for caring of the grave, or is it just out of the income from trust property? If the former it could be valid, if the latter, probably not and so the trust fails for perpetuity.
I HOPE THIS IS RIGHT, I HAVE THE SAME EXAM TOMORROW!
Prudy, what you don't do is consider the different constructions that you might take of those words.
"for as long as the money lasts" could be understood as an absolute gift, with any obligations being purely moral. A case where this was done is Re Lipinski's WT. It could be understood as creating only an interest in remainder with a power of appointment - that is an income only interest with a capital power of appointment - i.e. a trust of the form "Property to X, remainder to Y, X to have a power to appoint capital". A convenient way to consider these issues is under the head of certainty of intention. What the court is essentially doing in these cases is looking for the most appropriate way to analyse the facts before it - it might be a trust even if the settlor did not say "I'm creating a trust", as in Paul v Constance, or it might be something else entirely.
Don't forget the beneficiary principle. It might be possible to read these trusts as not being purpose trusts at all, but as being for the benefit of particular people. Depending on the facts, the upkeep of the grave might be seen as being for the benefit of whoever owns the graveyard. A trust for the care of the animal might be read as being for the benefit of the person who now looks after the animal rather than the animal itself. This was done in Re Denley's Trust Deed, where a sports ground was left "for the benefit of" the employees of the company. This was read as a trust granting the employees proprietary rights as beneficiaries, rather than as a abstract purpose trust - Goff J took the view that as long as the employees can take some sort of direct or indirect benefit, that is enough to make them a beneficiary.
The law regarding certainties is generally quite simple, if you have the technique they are quite easy questions. What you want to do is take each possible issue one by one (the certainties, beneficiary principle, perpetuities, formalities), consider how the facts in the question might be understood, consider the consequences of each possibility and consider which interpretation you think to be the most appropriate one on the facts.
Good luck....
"for as long as the money lasts" could be understood as an absolute gift, with any obligations being purely moral. A case where this was done is Re Lipinski's WT. It could be understood as creating only an interest in remainder with a power of appointment - that is an income only interest with a capital power of appointment - i.e. a trust of the form "Property to X, remainder to Y, X to have a power to appoint capital". A convenient way to consider these issues is under the head of certainty of intention. What the court is essentially doing in these cases is looking for the most appropriate way to analyse the facts before it - it might be a trust even if the settlor did not say "I'm creating a trust", as in Paul v Constance, or it might be something else entirely.
Don't forget the beneficiary principle. It might be possible to read these trusts as not being purpose trusts at all, but as being for the benefit of particular people. Depending on the facts, the upkeep of the grave might be seen as being for the benefit of whoever owns the graveyard. A trust for the care of the animal might be read as being for the benefit of the person who now looks after the animal rather than the animal itself. This was done in Re Denley's Trust Deed, where a sports ground was left "for the benefit of" the employees of the company. This was read as a trust granting the employees proprietary rights as beneficiaries, rather than as a abstract purpose trust - Goff J took the view that as long as the employees can take some sort of direct or indirect benefit, that is enough to make them a beneficiary.
The law regarding certainties is generally quite simple, if you have the technique they are quite easy questions. What you want to do is take each possible issue one by one (the certainties, beneficiary principle, perpetuities, formalities), consider how the facts in the question might be understood, consider the consequences of each possibility and consider which interpretation you think to be the most appropriate one on the facts.
Good luck....
thanks a lot ! im a little confused with the gifts to an unincorporated associations, in answering a question, how do we choose which approach to use ? or should we state all possibilities(guess not)... for example approach in Re Denley, Re Lipinski, Re Recher etc... im not sure what im asking, just dont really know what to do when a question like this comes out
"£1000 for the purpose of buying new bowls' equipment for the use of the members of Heatmond Bowls Club"
or something like
"£2000 for the Newton Cake Appreciation Club, for them to hold a party in my memory"
really hope anyone can clear this up for me, exam's in 2 days im so confused
"£1000 for the purpose of buying new bowls' equipment for the use of the members of Heatmond Bowls Club"
or something like
"£2000 for the Newton Cake Appreciation Club, for them to hold a party in my memory"
really hope anyone can clear this up for me, exam's in 2 days im so confused
jacketpotato
Prudy, what you don't do is consider the different constructions that you might take of those words.
"for as long as the money lasts" could be understood as an absolute gift, with any obligations being purely moral. A case where this was done is Re Lipinski's WT. It could be understood as creating only an interest in remainder with a power of appointment - that is an income only interest with a capital power of appointment - i.e. a trust of the form "Property to X, remainder to Y, X to have a power to appoint capital". A convenient way to consider these issues is under the head of certainty of intention. What the court is essentially doing in these cases is looking for the most appropriate way to analyse the facts before it - it might be a trust even if the settlor did not say "I'm creating a trust", as in Paul v Constance, or it might be something else entirely.
Don't forget the beneficiary principle. It might be possible to read these trusts as not being purpose trusts at all, but as being for the benefit of particular people. Depending on the facts, the upkeep of the grave might be seen as being for the benefit of whoever owns the graveyard. A trust for the care of the animal might be read as being for the benefit of the person who now looks after the animal rather than the animal itself. This was done in Re Denley's Trust Deed, where a sports ground was left "for the benefit of" the employees of the company. This was read as a trust granting the employees proprietary rights as beneficiaries, rather than as a abstract purpose trust - Goff J took the view that as long as the employees can take some sort of direct or indirect benefit, that is enough to make them a beneficiary.
The law regarding certainties is generally quite simple, if you have the technique they are quite easy questions. What you want to do is take each possible issue one by one (the certainties, beneficiary principle, perpetuities, formalities), consider how the facts in the question might be understood, consider the consequences of each possibility and consider which interpretation you think to be the most appropriate one on the facts.
Good luck....
"for as long as the money lasts" could be understood as an absolute gift, with any obligations being purely moral. A case where this was done is Re Lipinski's WT. It could be understood as creating only an interest in remainder with a power of appointment - that is an income only interest with a capital power of appointment - i.e. a trust of the form "Property to X, remainder to Y, X to have a power to appoint capital". A convenient way to consider these issues is under the head of certainty of intention. What the court is essentially doing in these cases is looking for the most appropriate way to analyse the facts before it - it might be a trust even if the settlor did not say "I'm creating a trust", as in Paul v Constance, or it might be something else entirely.
Don't forget the beneficiary principle. It might be possible to read these trusts as not being purpose trusts at all, but as being for the benefit of particular people. Depending on the facts, the upkeep of the grave might be seen as being for the benefit of whoever owns the graveyard. A trust for the care of the animal might be read as being for the benefit of the person who now looks after the animal rather than the animal itself. This was done in Re Denley's Trust Deed, where a sports ground was left "for the benefit of" the employees of the company. This was read as a trust granting the employees proprietary rights as beneficiaries, rather than as a abstract purpose trust - Goff J took the view that as long as the employees can take some sort of direct or indirect benefit, that is enough to make them a beneficiary.
The law regarding certainties is generally quite simple, if you have the technique they are quite easy questions. What you want to do is take each possible issue one by one (the certainties, beneficiary principle, perpetuities, formalities), consider how the facts in the question might be understood, consider the consequences of each possibility and consider which interpretation you think to be the most appropriate one on the facts.
Good luck....
Yeah :embarrased:
Sorry, was at the **** end of a caffiene high/low/smorgasbord of testicle.
Ne'er mind, 1 down, even got a (essay as oppsed to problem) question on Re Denley. See, handn't forgotten it really
srepsa618
thanks a lot ! im a little confused with the gifts to an unincorporated associations, in answering a question, how do we choose which approach to use ? or should we state all possibilities(guess not)... for example approach in Re Denley, Re Lipinski, Re Recher etc... im not sure what im asking, just dont really know what to do when a question like this comes out
"£1000 for the purpose of buying new bowls' equipment for the use of the members of Heatmond Bowls Club"
or something like
"£2000 for the Newton Cake Appreciation Club, for them to hold a party in my memory"
really hope anyone can clear this up for me, exam's in 2 days im so confused
"£1000 for the purpose of buying new bowls' equipment for the use of the members of Heatmond Bowls Club"
or something like
"£2000 for the Newton Cake Appreciation Club, for them to hold a party in my memory"
really hope anyone can clear this up for me, exam's in 2 days im so confused
Go through the different possibilities.
Unincorporated associations questions are again a very easy question to answer. The trick isn't to assume that there must be a yes or no answer. There are no "yes or no" answers. There are a number of different approaches that have been taken, and there are a number of different ways in which you will be able to treat the facts of any different problem. What you are trying to do is go through the different interpretations, look at the consequences of each interpretation, and then consider which interpretation/interpretations are the most appropriate on the facts.
So yes, you do need to go through all the possibilities. Before the exam, get yourself a list of the different ways in which property might be held by a UA; and a list of ways in which the assets of a UA might be distributed on its dissolution. You basically just run through that list. You may well conclude that some possibilities are entirely inappropriate on the facts, but explain why. What you musn't do is jump straight to the conclusion that "Oh, this is obviously governed by contract holding theory", or "it obviously results back to the settlor under a resulting trust".
this is a little off topic hehe...
in Tracing claims.. at the end of the question something like
At the end of these transactions, the account was overdrawn £200.
do we need to address this issue ? guess not ? if we need to, how ?
basically, we need to trace those misapplied funds and remedies those claimants can have.
what about this end sentence of bank being overdrawn £200.
in Tracing claims.. at the end of the question something like
At the end of these transactions, the account was overdrawn £200.
do we need to address this issue ? guess not ? if we need to, how ?
basically, we need to trace those misapplied funds and remedies those claimants can have.
what about this end sentence of bank being overdrawn £200.
srepsa618
this is a little off topic hehe...
in Tracing claims.. at the end of the question something like
At the end of these transactions, the account was overdrawn £200.
do we need to address this issue ? guess not ? if we need to, how ?
basically, we need to trace those misapplied funds and remedies those claimants can have.
what about this end sentence of bank being overdrawn £200.
in Tracing claims.. at the end of the question something like
At the end of these transactions, the account was overdrawn £200.
do we need to address this issue ? guess not ? if we need to, how ?
basically, we need to trace those misapplied funds and remedies those claimants can have.
what about this end sentence of bank being overdrawn £200.
This is about mixing. You have various rules with regards to bank accounts. The problem with mixing is you don't know exactly whose money does what. There are various presumptions and rules of law to get around this. There are various presumptions resolving uncertainties in favour of the beneficiary if the fiduciary mixes with his own money; but there is equal treatment if he mixes the money with an innocent volunteer.
Obviously there is no point tracing into an overdrawn bank account. But you might want to trace into something bought with money withdrawn from the bank account. The problem here with overdrafts is the general rule against backwards tracing - though it is clear that there are cases where the courts have effectively allowed backwards tracing to happen, even though they technically shouldn't.
For bank accounts generally, you need to look at how mixing works to see how far you can do this. Exactly which bits are relevant depends on the question.
If a fiduciary (the trustee) mixes the beneficiaries' money with his own money in a bank account, then the idea is that you resolve any uncertainty in favour of the beneficiary. Regarding withdrawals it is presumed that he spent his own money first (Re Hallett's estate), though a beneficiary can reverse this and say that it was his money that was spent if he wishes to trace into something that was bought with that money.
However, this stops at the lowest intermediate balance rule. You can't trace into anything larger than the lowest intermediate balance, because then you are tracing in an impossible way - the law doesn't presume that money added to the account goes to the beneficiary, it only presumes that money removes from the account is the trustee spending his own money.
If the fiduciary mixes with the money of an innocent volunteer, then we have the rule in Clayton's Case - first in, first out. But you can displace this and simply have an equal distribution where the rule might be impractical or unjust, Barlow Clowes v Vaughan: this is quite easy to do really.
n.b. if the bank account is a deposit only account, then its not mixing. But this is not ever going to be likely on the facts of a problem.
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