- Why is certainty of subject matter important?
- What are the key differences between a trust and a gift?
- What is a gift in equity law?
- How do trusts fail?
- Who owns property in a trust?
- What are the three certainties?
- What are the 3 certainties of a trust?
- What are the essential elements of a valid trust?
- What are the disadvantages of a trust?
- What is conceptual certainty?
- Can a beneficiary of a trust also be the trustee?
- Do the three certainties apply to gifts?
Why is certainty of subject matter important?
The certainty of subject matter is the requirement that the trust property left to the beneficiary must be easily identifiable, along with the interests gained by the beneficiary.
The trust is likely to fail if the property left on trust is unidentifiable or uncertain..
What are the key differences between a trust and a gift?
Generally trusts are used as they allow the settlor a degree of control over how the property is to be used whereas gifts are used when no control over the asset is required.
What is a gift in equity law?
A gift is where one person transfers consideration to another without receiving consideration in return. They are not enforceable by common law. Equitable titles and the doctrine of Part performance are examples of how equity attempts to achieve ‘what is fair’ even in the absence of adherence to legal requirements.
How do trusts fail?
In my experience, there is one reason why a trust fails that is more prevalent than any other reason: it wasn’t properly funded. A trust manages assets that are in the trust. It cannot manage assets that are not titled in the name of the trust.
Who owns property in a trust?
Ownership of trust property is split between a trustee and a beneficiary. Legal ownership of the trust property is vested with the trustee, whilst a beneficiary has equitable ownership of the trust property.
What are the three certainties?
For an express trust to be valid there has to be three certainties. These are certainty of intention, certainty of subject matter, and certainty of objects. Without these certainties, an express trust will not be valid. The purpose of these certainties is to ensure the trust is properly controlled and enforced.
What are the 3 certainties of a trust?
The three certainties refer to a rule within English trusts law on the creation of express trusts that, to be valid, the trust instrument must show certainty of intention, subject matter and object.
What are the essential elements of a valid trust?
The UTC provides that a trust must meet the following requirements (UTC 402): 1) the settlor must have the capacity to create the trust; 2) the settlor must have the intent to create the trust 3) there must be at least one definite beneficiary; 4) there must be duties for the trustee to perform; and 5) the sole trustee …
What are the disadvantages of a trust?
The major disadvantages that are associated with trusts are their perceived irrevocability, the loss of control over assets that are put into trust and their costs. In fact trusts can be made revocable, but this generally has negative consequences in respect of tax, estate duty, asset protection and stamp duty.
What is conceptual certainty?
Conceptual certainty relates to the certainty of the class; evidential certainty relates to the issue of whether an individual can be found or proven to be a member of the class or not. If a class is conceptually uncertain, the trust will be void, but evidential uncertainty will not defeat a trust.
Can a beneficiary of a trust also be the trustee?
Yes, a trustee can be one of the beneficiaries of a trust. For example, an individual could set up a trust, appoint themselves as trustee and distribute income to their family. However, a trustee cannot be the sole beneficiary of a trust.
Do the three certainties apply to gifts?
‘ – court will try to interpret the words and conduct used as much as possible to give effect to the trust. The three certainties apply to both gifts and trusts although the concept was first propounded in relation to trusts (in Knight v Knight (1840) 3 Beav 148 – Lord Langdale identified the 3 certainties.