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Certainty - Trusts

So, I am looking at a four part problem question on certainty. But having difficulty in applying my certainty notes.

A dies survived by B; A's will appoints C as trustee/executor.

The problem for me is that the four parts appear to include: -

i) Gift w/Condition Precedent
Collection of silver to my sister 'so that she can permit former London Council members to choose a piece each';

ii) Fixed trust
£1,000 'to be divided among patients at London Hospital during the year preceding my death;

iii) Discretionary Trust
£2,000 'held on trust to make grants at discretion of trustees amongst prominent business leaders in London, in doubt to be decided by my friend Dave';

iv) Gift, with surplus being fiduciary power?
Residue to my uncle Eric, what he doesn't want to be distributed by the trustees 'if they in their absolute discretion think fit amongst former employees, current employees, etc. of London Co.'

There are four different types of settlement. My main question is, what is the purpose of these four different types? Do I need to consider them in different ways, or consider them all in the same way (by applying 3 certainties) and then conclude them all differently.

Any advice? Thanks.

Reply 1

jacketpotato

Consider each one separately. Don't jump to conclusions too much - with regards to i) and iv) the main point is to establish whether there has been certainty of intention (i.e. whether a trust was intended or a power or a gift).

Reply 2

Over_The_Odds

Original post by jacketpotato

Thanks JP. Does it matter that in part i the trustees/executors give to the sister before permitting former London Council members to pick a piece each? I mean, if it's not a trust, then the trustees are not obliged to carry it out, so could they take as a gift instead of the sister taking as a gift?! Or is this impossible because of their fiduciary duties?

hmm.

Reply 3

jacketpotato

Original post by Over_The_Odds

If there's no trust there are fiduciary duties. i) looks like a straight gift (as opposed to a gift with a condition precedent, there is no condition precedent, the condition is subsequent i.e. would affect the sister's consience after she took the gift).

Reply 4

Over_The_Odds

Original post by jacketpotato

I think I do tend to jump to conclusions, and I've seen that from the feedback from past exams this is a common problem.

The thing is, how do I go about discussing intention in more detail? It's a matter of construction of the words, I understand...but...

For example, if we take i) above. 'so that she can permit', immediately it doesn't sound obligatory to me. How should I go into more detail than that?

Sorry, bit of a weird question, I know.

Reply 5

Zacho

Original post by Over_The_Odds

I know this wasn't directed at me, but i am revising this atm as well so thought i'd chip in...

If I were answering that then I would say it is probably imperative enough. I would link discuss cases where the wording hasn't been allowed - Lambe v Eades "in a way she might think best" and Re Adams and Kensington Vestry.

Then I would say that the words here seem sufficiently certain - it is better than "in the hope that she will". It could go either way u suppose.

I also mention why it is necessary that the intention is certain and what happens if the words are deemed precatory.

Anyway, with (i) you also need to consider certainty of objects and certainty of subject-matter.

Reply 6

Over_The_Odds

Original post by Zacho

I also mention why it is necessary that the intention is certain and what happens if the words are deemed precatory.

Cheers. Yea, this bit is important I think. I always forget to point out the ramifications. So, you'd say something about if they are merely precatory then the property will pass as an absolute gift?

I'm not good at this. But, by the way, I checked my notes on the 'admin unwork'/capriciousness, and my lecture notes definitely make the distinction b/w AU being trusts (West Yorks) on the one hand, and Re Manisty's capriciousness being for powers. Although I think my textbook said that the example of Greater London was being used in both. The point with Re Manisty is that it wasn't being suggested as the group being too large (since the court would not need to execute a power), but that the judge thought it was arbitrary.

Any idea where Re Hay's fits into that jargon? Power...capriciousness...but I'm not sure of the ratio.

Reply 7

Zacho

Original post by Over_The_Odds

Cheers, for the info about unworkability/capricious, it does make sense a bit more now.

I would say something like if there isn't sufficient intention to create a trust due to the use of precatory words, the property will go as an absolute gift to the trustee (assuming there has been a valid transfer of legal title to them).

Re Hays just gave the xample that a discretionary trust for residents of Greater London wouldn't be unworkable/capricious if the settlor was a former chairman of Greater London Council. It is just an example to show where Re Manisty wouldn't be capricious i think.

God, I'll be pleased when i can forget all this stuff!

Reply 8

jacketpotato

Original post by Over_The_Odds

^ What Zacho said.

I find it helpful to think of reasons "for" and "against" in respect of each and every point. For smaller points, I do it in my head. For larger points, I do it on paper. I try to think about what I might say if I was representing the other side, and jot down the key points each side would make. I find this a helpful way of making sure you reach a balanced view, and comparing the reasons appearing in your little table is helpful for evaluating why one side is stronger.

A structure along the lines of:
"This interpretation could be taken for reasons X, Y, Z.
Another interpretation could be taken for A, B, C.
On balance, the first interpretation is strongest because reason A was disredited in the case ROF v TSR and reason Z is particularly strong because ..."