A more recent version of these 3 Certainties Formalities Constitution notes – written by Cambridge/Bpp/College Of Law students – is available here.
The following is a more accessble plain text extract of the PDF sample above, taken from our GDL Equity and Trusts Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
Equity & Trusts : The 3 Certainties; Formalities; Constitution Structure
?????Type of property (realty/personalty)
?????Transferor's title: legal or equitable or absolutely entitled.
?????Type of disposition: o Gift: constitution only o Self-declaration of trust o Transfer of trust o [[could be will/testamentary ? Wills Act]]
?????Any formalities? (if involves moving equitable title): o applies to self-declaration trust; transfer of trust; and wills (even if gifts). o No formalities for gift [[though if testamentary must comply with Wills Act]].
?????If formalities not fulfilled, any exceptions: o Vandervell, Grey etc.
?????Constitution requirements: Re legal title (none for self-declaration of trust)
?????if not valid constitution, any exceptions to Milroy v Lord?
o Re Rose o Mascall v Mascall o Strong v Bird
? Conclusion: what happens to the property
Type of propertyrealty/personalty; chattel, shares; chose in action; land etc
?????legal or equitable or absolutely entitled.
(intended) Type of disposition:
?????Gift: need constitution only
?????Self-declaration of trust: declaration only
?????Transfer of trust: need declaration & constitution)
?????Power of appointment
?????Gift subject to condition precedent
?????[[could be will/testamentary ? Wills Act]]
The 3 Certainties
?????Knight v Knight, an express trust needs 3 certainties: (1) Intention; (2) Subject matter; (3) Object
1 (1) Intention
?????Re Kayford: whether in substance there is intention
?????Imperative v precatory, Eg 'In full confidence', depends on context: o Look at words in context of whole document (Re Adams; Comiskey) o Do they suggest a command (Comiskey) or merely a hope (Re Adams). o Precatory: Re Adams & Kensington Vestry: 'in full confidence that she will do what is right', re disposal between his children in her lifetime or by her will; precatory, an expectation, only a moral obligation ? no intention to create trust. o Cf Imperative: Comiskey v Bowring-Hanbury: also 'in full confidence' 'that she will devise it to one or more of my nieces, imperative, certainty. Key factor: direction that if she didn't dispose of it, estate would, on her death, go to nieces in equal shares ? intention/command.
?????Use old cases re same language: o Not necessarily, depends on context (Re Hamilton) o CF, if working identical, follow older case as may have been deliberately used as precedent (Re Steel's WT).
?????Conduct: o Paul v Constance: didn't use technical language; didn't know what trust was; conduct sufficient: created essentially jointinterest bank account; told her money is 'as much yours as mine'; held on trust for both. o Re Kayford: segregated customers' funds = intention by conduct. (2)(a) subject matter, trust property itself
?????Sprange v Barnard: 'remaining part of what is left' ? not certainty, uncertain what will be left.
?????Palmer v Simmonds: 'bulk' of my estate---not certain.
?????Re Golay's WT: 'reasonable' = certain, objectively ascertainable
?????Boyce v Boyce: need objective determinant.
?????Bulk property, tangible ? must be segregated/identifiable: o Re London Wine: no trust, bottles not segregated. o Re Goldcorp Exchange: gold bars, not segregated (one investor has asked to set aside).
?????Bulk property, intangible ? doesn't need to be identifiable o Hunter v Moss: electronic shares; don't need to identify [[re settlor declares hold 50 of her 950 shares on trust for B, doesn't specify which]]. o Rationale: all shares identical (cf wine bottles) o Critique: if settlor sold 50 of his shares, how would we know whether they were his own or the 50 held on trust?
2 o Harvard Securities: explained Hunter with factional/coownership theory (Neuberger J): backed by Prof Goode o [also NB factual difference in reasoning: Hunter didn't involve insolvency, so finding trust didn't mean giving priority over other creditors, CF Goldcorp & London Wine]. o MacJordan v Brookmount: even if assets intangible, still need ascertainable fund. (2)(b) subject matter, certainty of beneficial entitlement
?????Boyce v Boyce: houses left to 2 daughters; first got to choose, remaining to other daughter; died before choosing---no certainty re beneficial entitlement.
?????CF Re Golay's WT: 'enjoy one of my flats during her lifetime' +
'reasonable income': sufficiently certain (CF Boyce, shows can go either way); re 'reasonable' point, see above---objectively ascertainable. (3) Certainty of object
? (need certainty of object ---Morice v Bishop of Durham -->
beneficiary principle ? need a definite object or trust void, unless charitable)
?????(a) Fixed Trusts---'Fixed/Complete List test' (IRC v Broadway Cottages): can draw up complete list of class of beneficiaries (or class ascertainability for gift).
?????Need conceptual & evidential certainty to draw up complete list.
?????(b) Powers of appointment ('Is/Is Not' test), Re Gulbenkian's ST: if can look at anyone and say with certainty whether 'is or is not' member of class.
?????(c) Discretionary trust, 'Is/Is not' test, McPhail v Doulton: o [[Used to be same as for fixed trusts, Broadway Cottages 'fixed list' test. But then HL, McPhail: o McPhail v Doulton (AKA Baden No 1), HL: 'Is/Is Not' test (same as for powers): can it be said with certainty that any given individual 'is or is not' a member of the class (Lord Wilberforce). o Re Baden's DT (No 2), CA: o Conceptual certainty, all 3 judges say you need it to satisfy 'Is/Is Not' (re 'relatives'):
? Megaw & Sachs LLJ, relatives = 'common ancestor'
? Stamp LJ,relatives = 'next of kin' o Evidential certainty, Megaw and Sachs say 'don't knows' doesn't void trust:
? Stamp LJ: need evidential certainty for discretionary trust, any don't knows = void. Literal/strict Is/Is not test application.
? Megaw LJ: not void, if can show 'substantial number' definitely fall within.
Buy the full version of these notes or essay plans and more in our GDL Equity and Trusts Notes.