Q1) Nigel has recently died.

A week prior to his death, he declared in writing that he held

200 shares in Oilco plc on trust for Martin. At that point, Nigel held 1,000 shares in Oilco
plc outright. By his will, Nigel left his residuary estate to his widow ‘in the confident
expectation that she will use it for the benefit of our children’.
Advise Nigel’s children.
Ans) We understand from the case above that two trust scenarios regarding the topic of
certainty arises as Nigel's (the "N") recent passing has left behind a complex situation
regarding the distribution of his assets. Just a week before his death, he officially
declared in writing a trust arrangement for Martin (the "M"), involving 200 shares in
Oilco plc, despite possessing a total of 1,000 shares in Oilco plc in his personal
ownership. Simultaneously, Nigel's will allocates his residuary estate to his widow with
an expectation that she would use it for the benefit of their children. This sets the stage
for a nuanced exploration of trust law intricacies, necessitating a careful analysis to
counsel Nigel's children on their legal entitlements and potential claims following their
father's demise. Lord Langdale MR in the case of Knight v Knight (1840) established 3
elements which include certainty of intention, certainty of subject matter and certainty of
object which if thus clearly met would thereby create a valid trust. Hence we shall
discuss this separately in the answer below.
General law:
Before moving any further, we must understand the clarity behind what a trust really is
which by law is a legal arrangement for handling and distributing assets between the
two parties, firstly the ‘settlor’ (i.e; property holder) on who creates an equitable
obligation upon the ‘trustee’ (i.e; administrator of the property) to hold the legal title of
the property for the benefit of the ‘beneficiary’ (i.e; equitable owner). Introduced by the
courts of equity, trust is divided into two types being firstly the express trusts that are
created by the parties either for the benefit of any party or charitable purpose whereas
the second is a trust arising by operation of law (“TABOLS”) which by its name are not
intentionally created rather are a response to particular circumstances which the law
deems fit to give rise to a trust.

Both of the above types have different categories of trusts which we shall shed light
upon in a few lines. If we consider express trusts, it includes firstly a testamentary trust
that comes into operation when the testator (i.e; an individual who has executed the will)
dies, secondly the inter vivos trust that comes into operation immediately upon
declaration during life, third is the self-declared trust (i.e; settlor and trustee are the
same but the beneficiary is different person, tripartite trust (i.e; involves distinct settlor,
trustee and beneficiary and here the settlor voluntarily gives the trustee to hold the trust
for the beneficiary, trust for beneficiaries and a purpose trust (i.e; devoted to carrying
out a purpose ; Re Shaw [1957]). However, on the contrary a TABOL is divided into
three categories in which first two are the so called ‘implied trusts’ by the common law
known firstly as a constructive trust (FHR European Ventures LLP v Cedar Capital
Partners LLC) and other being a resulting trust (Re Vandervell (No.2)). Moreover, the
third category is known as a statutory trust which is created by an act of parliament (i.e;
English land law).
We see that with the inter-vivos declaration of trust to M's, an analysis of its components
reveals N's intent to transfer his shares (Hayton v Mitchell), with the beneficiaries i.e;
M clearly identified (Re Endercott). However, a challenge emerges concerning the
subject matter of the trust. Meeting the requirement for certainty of subject matter
entails two conditions: firstly, the property held in trust must be definite, and secondly,
the share of the property subject to the trust must be specific. Certainty of subject
matter entails both conceptual and evidential certainty. Conceptual certainty
necessitates precise and clear language from the settlor, while evidential certainty
mandates additional evidence even if the settlor's language is clear.
Applying these principles to the scenario, the property held in trust is clear and certain,
but the shares lack clarity because the specific 200 out of the 1000 shares are not
specified. A precedent illustrating the importance of this distinction is Re London Wine
Co, where a breach of trust claim was dismissed due to the lack of specificity regarding
which cases belonged to which customers. Oliver J ruled that the company didn't
breach trust because the connection between specific cases and customers wasn't
explicitly stated, highlighting the issue of certainty in subject matter. This stance was
later affirmed in Re Gold Corp by the Privy Council, with Lord Mustille emphasizing that
a right in property, whether legal or equitable, must be linked to a specifically identified
property.
This analysis suggests that N's declaration of trust might be invalid based on the
uncertainty of subject matter. However, it's crucial to note that the cases discussed
involve tangible property. To shed light on this distinction, consider the case of Hunter
v Moss, where the property in question was shares. Although the shares were
designated for transfer, the specific quantity wasn't specified from the total amount.
According to Penner, this lack of specificity rendered the trust invalid. Nonetheless,
Dillon LJ in the Court of Appeal distinguished Hunter v Moss from Re Wine by
emphasizing the nature of the property; tangible in the case of wine and intangible in the
case of shares. Consequently, the trust in Hunter v Moss was deemed valid, as the
precise quantity of shares for the trust was deemed immaterial. Dillon LJ asserted that a
person can declare themselves trustee of a specific number of shares, and that
declaration effectively confers a beneficial proprietary interest to the beneficiary. In
Hunter v Moss, a person could declare themselves a trustee of specific shares, creating
a beneficial interest. Despite criticism, it influenced Re Harvard Securities, confirming
trust validity for a percentage of shares. Pearson v Lehman followed this approach.
Applied here, a constructive trust on Nigel's 1000 shares, allocating 200/1000 to Martin,
validates the declaration, leaving 800 shares for Nigel's children.
Moving forward to the second element, it involves a testamentary transfer of residue to
the widow, prompting an analysis through the lens of Knight v Knight. In testamentary
trusts, Penner underscores the importance of the testator's words in determining intent
to create a trust (Re Ford). Courts though scrutinize expressions of intent, emphasizing
that unexpressed intentions are insufficient (Hayton v Mitchell). Imperative or
authoritative language in the will is crucial, as seen in Wright v Atkins, excluding
discretionary terms. Additionally, the settlor must bind the trustee under an enforceable
obligation (McCormick v Grogan). In the current case, Nigel's use of precatory
language, akin to Mussorie Bank Ltd v Raynor (1884) and Wilkinson v North
 (2018) being great examples but raising concerns. However, we can also see that the
precedent in Comiskey v Bowring Hanbury highlights that, in certain situations, equity
prioritizes intent over form. The court considered the settlor's subsequent statements,
excusing precatory words and affirming the trust. N's children could invoke this principle,
arguing that despite the precatory language, the overall intent signifies a trust.
Conclusion:
Conclusively, the children stand to inherit 800 remaining shares from the inter-vivos
trust. Regarding the testamentary trust, an argument can be made, drawing on the
precedent set by Comiskey case, asserting the children's status as beneficiaries to the
residuary estate. However, there remains a deficiency in clear intent within the
statement. Without further specifications regarding the disposition of the property by the
wife, Nigel's expressions appear more aspirational than obligatory.

Q4) Donna owned three houses (in fee simple) in her local village. She wanted to give one
house (called ‘Carnation Cottage’) to her daughter, Amy, and another house (called
‘Violet Villa’) to her other daughter, Rose. Donna executed the forms to be used to
transfer those fee simple estates to her daughters, and on the day she left for a long
ocean cruise, delivered both transfer forms to Amy and asked her to take care of the
registration to complete the transfers. Amy agreed, but was busy at work and forgot to
submit the forms for registration. Donna died during her ocean cruise. Her son, Rory, is
the sole beneficiary of her entire estate and her executrix, Martha, is now the registered
owner of all three houses. Amy still has the transfer forms in her possession. The form
to transfer Carnation Cottage to Amy was improperly executed and therefore could not
have been registered. The form to transfer Violet Villa to Rose was valid and registrable
up until Donna died. What rights, if any, does Amy have to Carnation Cottage? What
rights, if any, does Rose have to Violet Villa? Would it make any difference to your
answers if Amy had been appointed as Donna’s executrix, instead of Martha?
Ans) Summary of Facts:
It is imperative to understand from the case facts that Donna (the "D") had passed away
on a cruise ship and therefore before her death wanted to give away two out of three
houses to her daughters namely Amy (the "A") and Rose (the "R"). However, as Martha
(the "M") was the executrix who has now become the registered owner of all three
houses whereby the son ("RO") has become the sole beneficiary of the entire state
leaving her two sister with nothing. Hence as a legal advisor, we shall determine the
whether both the daughters have any rights to their respective houses or not.
General Rule:
For a valid express trust to be formed, it is essential that the trust property be must be in
hold/vest of the trustee. There are various forms of express trusts and in our case we
understand that it is created by the parties where an equitable obligation is held on the
property holder (trustee) who is not obliged to take any benefit rather hold the legal title
of the property for the benefit of equitable owner (beneficiary). In our case we
understand that as D was the settlor who wanted to gift her two daughters, A and R one
house each therefore for that she must execute the forms for the transfer of title. We
understand that this is indeed a Tripartite form of express trust as it involves a distinct
settlor i.e; D, a trustee which was A who forgot to transfer the titles and the beneficiaries
were A and R.
On the other hand as the properties were fiduciary arrangements therefore will be
considered as gifts therefore D will be the donor whereas the beneficiaries will be
regarded as donees. On the contrary assuming that the houses i.e; Violet Villa and
Carnation Cottage were registered in the HM registry hence meets the first requirement
in order to assist the two A and R in getting their right.
The general rule does not favor the innocent here in any sort of way as in our case A
failed to transfer the legal title when given the responsibility. Whereas in the case of an
imperfect gift/trust, equity will not assist the volunteer and remove imperfections. This
general rule though burdening the innocent is yet derived from the case of Milroy v
Lords (1862), as Turner LJ held that only in three ways one can benefit another i.e; gift
property to another, transfer property to third party and impose trust duty on him or self
declare a trust on someone else. In our case as none of such occured due to the settlor
passing away on the cruise ship hence the innocent party cannot avail any benefit from
the general rule. However every general rule has it's exceptions and therefore we shall
delve into those and see whether both A and R can get any sort of benefit or not
separately.
A:
We understand that A was given the responsibility to transfer the legal title of the
property by D which she eventually failed to complete in her lifetime. We understand
that A had not even initiated the registration process therefore the first exception of Re
Rose Principle will not apply as the form wasn't even delivered to the registrar and it
was A who had the transfer forms in her possession. However we can somehow rely on
the exception of unconscionability as hereby the courts can perfect an imperfect gift.
Though this opens an argument of not having a general rule as every promise will lead
to exception being considered however it should be only used in novel situations such
as ours. Briggs J in Curtis v Pulbrook explained the decision in Pennington on the
basis of detrimental reliance as in the Pennington v Waine (2002). Arden LJ observed
that the harsh application of Milroy v Lord caused "paradoxical results." On the contrary
a celebrated case namely Choithram v Pagarani (2001), where the privy council
appreciated the unconscionability principle. rcMoreover, in the case of Zeital v Kaye
(2010), the Court of Appeals focused on the steps that donor took, and it was easy to
see what further steps could've been taken. And in our case, the courts could easily see
that D had given the possession of the transfer forms to A and had shown her intention
to transfer the titles to A and R hence it is clear that A and R are the deserving owners
of the state.
On the other hand, one can also argue that if A had been appointed as the executrix by
D instead of M hence the Strong v Bird exception would've applied and the equity
would have also been automatically perfected the imperfect gift/trust. Though this is a
criticized exception by Penner as it's a lottery where some individuals can benefit from
becoming an executor of the deceased yet it's application in the case Re Stewart
(1908) and Re James (1935) validates this exception as a strong ground of principle to
be applied once the testator dies.
R:
Furthermore, R also had rights over Violet Villa which she did not get due to A's failure
in execution therefore the same exception of unconscionability would apply in her due
case as well. Furthermore we can also argue that as RO who is the brother of the
sisters already had one house in the village for himself therefore keeping the other two
as well i.e; Carnation Cottage and Violet Villa is unjustified and not equal as in the end
of the day, the two sisters would be left with nothing therefore the courts shall also
apprehend upon this matter and upon their judgement declare the current distribution of
property as invalid.
Conclusion:
In conclusion, Donna's passing prompts legal scrutiny of her intention to gift houses to
daughters Amy and Rose. The executrix Martha currently holds all three houses,
challenging the sisters' inheritance however the courts considering the exceptions would
eventually give them their rights albeit the general rule not applying. The legal analysis
explores express trusts, gift considerations, exceptions, and potential avenues for Amy
and Rose to assert ownership per Donna's wishes.
Critically discuss the various taxonomies that have emerged attempting to bring order to
the Resulting
Trust, and, whether the debates regarding the intellectual underpinnings of the concept,
pertaining to in-
tention, withstand strict scrutiny.
Critically discuss the various taxonomies that have emerged attempting to bring order to
the Resulting
Trust, and, whether the debates regarding the intellectual underpinnings of the concept,
pertaining to in-
tention, withstand strict scrutiny.
Critically discuss the various taxonomies that have emerged attempting to bring order to
the Resulting
Trust, and, whether the debates regarding the intellectual underpinnings of the concept,
pertaining to in-
tention, withstand strict scrutiny.
Critically discuss the various taxonomies that have emerged attempting to bring order to
the Resulting
Trust, and, whether the debates regarding the intellectual underpinnings of the concept,
pertaining to in-
tention, withstand strict scrutiny.
Q) Critically discuss the various taxonomies that have emerged attempting to bring
order to the Resulting Trust, and, whether the debates regarding the intellectual
underpinnings of the concept, pertaining to in-tention, withstand strict scrutiny.

Ans) A resulting trust is a legal concept wherein the transferee holds property on trust
for the transferor. In essence, when A conveys property to B, B holds the trust property
for A. To bring clarity to this concept, traditionally, two categories have been recognized:
presumed and automatic resulting trusts, as illustrated in the case of Re Vandervell
(No. 2). However, this categorization has faced significant criticism for being inadequate
and misleading. Scholars such as Swadling and Oakley argue that the distinction
between presumed and automatic resulting trusts is not only false but also unhelpful.
They assert that these categories do not represent opposing concepts but instead
address different questions within the legal framework.

The primary debate surrounding resulting trusts centers on the role of intention in their
formation. Historically, the courts have focused on the transferor's intention to determine
whether a resulting trust should be established. However, Birks and Chambers
challenge this traditional notion, proposing an alternative theory based on unjust
enrichment. According to their perspective, the presumption of a resulting trust arises
not from a positive intention to create a trust but from the absence of an intention to
make a beneficial gift. This viewpoint is supported by several landmark cases, including
Vandervell v IRC and Air Jamaica Ltd v Charlton.

In Vandervell v IRC, the court dealt with the issue of whether a resulting trust should be
presumed in the absence of a clear intention to give beneficially. Similarly, in Air
Jamaica Ltd v Charlton, the court examined the circumstances under which a resulting
trust arises by operation of law due to the absence of an intention to pass a beneficial
interest. These cases highlight the courts' tendency to presume a resulting trust when
there is no evidence of an intention to gift beneficially. However, this perspective was
overruled in the case of Westdeutsche Landesbank Girozentrale v Islington LBC. In
this case, the court, relying on the arguments put forth by Swadling, emphasized that
resulting trusts are fundamentally based on the transferor's intention, thereby rejecting
the notion that equity is inherently suspicious of gifts.

Swadling's critique of the presumed and automatic distinction is rooted in the argument
that these categories do not provide a logical basis for the creation of resulting trusts.
He contends that the distinction between presumed and automatic resulting trusts is not
only misleading but also fails to address the substantive issues underlying the creation
of trusts. According to Swadling, 'presumed' refers to the procedural aspect of how the
fact triggering the trust is proved in litigation, while 'automatic' pertains to the
substantive aspect that the fact triggering the trust is not a declaration of trust. This
distinction, he argues, is artificial and fails to capture the true nature of resulting trusts.

In response to Swadling's critiques, Chambers reformulated his theory in 2010. He

argued that a resulting trust arises not due to the transferor's lack of intention to benefit
the transferee but because of the absence of a reason for the transaction. This theory
applies to both gratuitous transfers and purchase money resulting trusts. In cases of
gratuitous transfers, the absence of a reason for the transaction leads to the
presumption of a resulting trust unless the transferee can provide a reason, such as the
intent to make a gift. This analysis aligns with judicial reasoning and presents a
cohesive framework for understanding resulting trusts.

Chambers' reformulated theory provides a more comprehensive explanation for

resulting trusts and their application in case law. For instance, in Vandervell v IRC, V did
not intend for VTC to have the beneficial interest in the option. However, because V did
not specify express trusts, a resulting trust for V arose due to the absence of a reason
for the transaction. This avoided unjust enrichment for VTC. Similarly, this theory
clarifies why no resulting trust was imposed in Westdeutsche, where the apparent
reason for the transfer was the interest rate swap contract. By focusing on the absence
of a reason for the transaction, Chambers' theory offers a more logical and consistent
approach to resulting trusts.

Furthermore, Chambers' theory addresses the limitations of the traditional

categorization of resulting trusts. The traditional view, which focuses on the transferor's
intention, often leads to confusion and inconsistency in judicial decisions. By contrast,
Chambers' theory provides a unified explanation for resulting trusts, which can be
applied consistently across different cases. This approach not only simplifies the legal
framework but also ensures that resulting trusts are imposed in a fair and equitable
manner.

Another significant aspect of Chambers' theory is its alignment with the principles of
unjust enrichment. By focusing on the absence of a reason for the transaction,
Chambers' theory ensures that resulting trusts are imposed to prevent unjust
enrichment. This approach is consistent with the broader principles of equity, which
seek to prevent unjust enrichment and ensure fairness in the distribution of property. By
aligning resulting trusts with the principles of unjust enrichment, Chambers' theory
provides a more coherent and principled basis for the creation of trusts.

In addition to its theoretical strengths, Chambers' theory also provides practical benefits.
By focusing on the absence of a reason for the transaction, courts can more easily
determine whether a resulting trust should be imposed. This approach simplifies the
judicial process and reduces the likelihood of inconsistent or arbitrary decisions.
Furthermore, by providing a clear and consistent framework for resulting trusts,
Chambers' theory helps to ensure that property is distributed in a fair and equitable
manner.

Despite its strengths, Chambers' theory is not without its critics. Some scholars argue
that the focus on the absence of a reason for the transaction is too narrow and fails to
capture the complexity of resulting trusts. They contend that the traditional focus on
intention provides a more comprehensive basis for understanding resulting trusts and
that the role of intention should not be entirely disregarded.

However, these criticisms do not undermine the overall validity of Chambers' theory.
While intention may play a role in the creation of resulting trusts, it is not the sole
determining factor. By focusing on the absence of a reason for the transaction,
Chambers' theory provides a more consistent and principled basis for resulting trusts,
which aligns with the broader principles of equity and unjust enrichment.

In conclusion, this essay has explored the complexities and debates surrounding
resulting trusts. The traditional categorization of resulting trusts into presumed and
automatic types has been critiqued for its inadequacy and misleading nature. Scholars
like Swadling have argued that this distinction is artificial and fails to capture the true
nature of resulting trusts. The role of intention in resulting trusts has been a central point
of debate, with Birks and Chambers advocating for a perspective based on unjust
enrichment rather than intention.

In response to these critiques, Chambers reformulated his theory, arguing that resulting
trusts arise not from the transferor's lack of intention to benefit the transferee but from
the absence of a reason for the transaction. This theory provides a more
comprehensive and consistent basis for understanding resulting trusts, aligning with the
principles of unjust enrichment and ensuring fairness in the distribution of property.
While there are criticisms of Chambers' theory, it offers a more principled and practical
approach to resulting trusts, which addresses the limitations of the traditional
categorization and provides a clearer framework for judicial decision-making.

Overall, Chambers' theory represents a significant advancement in the understanding of

resulting trusts, providing a more coherent and principled basis for their creation. By
focusing on the absence of a reason for the transaction, Chambers' theory aligns
resulting trusts with the broader principles of equity and unjust enrichment, ensuring that
property is distributed in a fair and equitable manner. This approach not only simplifies
the legal framework but also enhances the consistency and fairness of judicial
decisions, making it a valuable contribution to the field of trust law.
FORMALITIES

Equity and the Importance of Clean Hands in Trusts

One of the core principles of equity is encapsulated in the maxim, "he who comes to
equity must come with clean hands." This principle emphasizes that equity seeks to
enforce fairness and prevents any party from exploiting its doctrines to perpetrate fraud
or illegality. Equity’s insistence on integrity is crucial as it aims to ensure that none of its
statutes are manipulated to commit fraud. The significance of formalities is underscored
in the Law of Property Act 1925 (LPA), specifically sections 53(2)(b), 53(2)(c), and
section 9 of the Wills Act. Trust creation can be divided into two main categories: inter
vivos trusts and testamentary trusts.

Inter Vivos and Testamentary Trusts

Inter vivos trusts are those expressly created by the settlor during their lifetime and,
under section 53(1)(b) of the LPA, must be evidenced in writing if they involve land. This
provision mirrors the requirements found in section 7 of the Statute of Frauds. While the
formalities required by equity are extensive and applied in various contexts, the primary
focus remains on the settlor's intent rather than the form. This focus aims to prevent
fraud and allows deviation from rigid formalities when necessary.

The Broad Scope of Formalities

Formalities are not only essential for creating trusts but also for the subsequent
dispositions of beneficial interests. If the formal requirements are not met, the trust
remains valid but unenforceable, a concept criticized in Gardner v Howee as being
merely procedural. This raises an important question: why is a trust deemed valid if it is
unenforceable? The answer lies in preventing fraud; declaring a trust void would allow
the trustee to take the property as a gift, thus using the statute designed to prevent
fraud as a tool to commit it.

The Role of Parole Evidence

In cases where parole evidence is presented, courts have the discretion to enforce such
trusts, as demonstrated in Rouchefoucauld v Boustead. Although this case was an
exception to section 53(1)(b) and did not align with section 7 of the Statute of Frauds,
the court accepted parole evidence. However, the statutes do not clearly define when
the writing requirement must be met. Lord Diplock, in Gissing v Gissing, affirmed that
the statute makes the writing requirement obligatory. Courts treat the writing
requirement flexibly, accepting even informal documents like notes on a wall or a tissue
paper to meet the requirement, a point emphasized by Jordan in his article. This
flexibility helps prevent fraud.

Transfers and Deeds

The transfer of land must be executed via a deed, but this requirement is limited to land
and does not apply to personal property. Resulting and constructive trusts are exempt
from this requirement under section 53(2) because they arise through court intervention
or operation of law. This demonstrates a justice-based approach rather than a strict
adherence to form. Section 53(1)(c) deals with the transfer of existing equitable
interests. Unlike section 53(1)(b), it applies to both real and personal property. If there is
a subsisting equitable interest, any disposition must be in writing; otherwise, it is void.
However, if no prior interest exists, the disposition does not require writing and remains
valid without it.

Case Law and Judicial Interpretations

The case of Grey v IRC illustrates the application of section 53(1)(c), where an oral
disposition of a subsisting equitable interest was void for not meeting the writing
requirement. However, once the writing was made, the disposition was validated,
showing that the writing requirement can be satisfied at any time. In Vandervell v IRC,
an oral disposition was initially subsisting but later became non-subsisting, making the
oral disposition valid. Despite criticisms that Vandervell invoked the fraud principle
unnecessarily, this case demonstrated the courts' flexibility in applying formal
requirements.

Academic Views and Practical Implications

Academics argue that section 53(1)(c) simplifies matters for trustees, protecting them
from false accusations about undisclosed transfers. In Re Vandervell (No. 2), after an
option to purchase was exercised, both the legal and beneficial titles were held by the
Royal College of Surgeons (RCS). Lord Denning stated that the trust created as a result
was valid, despite the lack of formal writing, because it involved personal property, not
land. Lord Upjohn, in Vandervell, asserted that the writing requirement is meant to
protect trustees from hidden oral transactions. However, the case of Grey v IRC, where
the trustee was aware of the disposition, raises questions about whether the writing
requirement extends beyond mere trustee protection to prevent broader fraud.

Testamentary Trusts and Formalities

Formalities also extend to testamentary trusts under section 9 of the Wills Act, which
requires a will to be signed by the testator and witnessed by two or more persons. This
requirement is justified by the need to prevent fraud, although secret trusts act as an
exception. Writing is essential for wills because the testator has died, necessitating
clear evidence of intent to prevent trustees from committing fraud. Secret trusts are
permitted to avoid fraud that might occur if the trustee were allowed to act contrary to
the deceased's wishes.

Conclusion
In conclusion, the requirement for formalities in trust law is fundamentally about
preventing fraud and ensuring justice. Courts show considerable leniency in interpreting
writing requirements, focusing on the prevention of fraud rather than rigid adherence to
form. This approach is evident in the flexibility allowed for informal writings to satisfy
statutory requirements. Nonetheless, criticisms of the LPA 1925 highlight the ambiguity
and uncertainty in some of its terms, which leave room for judicial interpretation. The
primary aim of formalities is to ensure caution and clarity in legal claims without
imposing unnecessary rigidity. While the writing requirement remains a general rule,
equity courts operate on a principle of good reason, ensuring that justice prevails over
strict procedural compliance.

By preventing fraud and maintaining flexibility, the equity system strives to balance the
need for formalities with the overarching goal of fairness. This balance ensures that the
intent behind transactions is honored, and equitable outcomes are achieved, reinforcing
the trust law's integrity and purpose.
SECRET TRUST

Secret Trusts: An Examination of Equity and Formality

Secret trusts are unique equitable obligations communicated to an intended trustee

during the testator’s lifetime. These trusts require the trustee to hold property on trust for
a beneficiary whose name is not mentioned in the will. This mechanism exemplifies
equity’s willingness to deviate from the rigid statutory principles laid out in the Wills Act
to achieve outcomes aligned with good conscience. The application of secret trusts is
exceptional, and judges have faced considerable pressure over the years to enforce
such trusts. Various theories have been developed to justify their enforcement, though
they often lack coherence.

Types of Secret Trusts

Secret trusts come in two forms: fully secret trusts and half secret trusts. A fully secret
trust arises when, on the face of the will, it appears as an absolute gift. However, the
legatee (trustee) agrees informally with the testator before their death to hold the
property in trust for another beneficiary. In such cases, the legatee appears to receive
the property absolutely, as in Sellack v Harris. In Ottaway v Norman, Brightman J
outlined that to establish a valid secret trust, there must be an intention to create the
trust, communication of that intention, and acceptance of the trust obligation. The main
issue with secret trusts is their non-compliance with the formalities required by the Wills
Act 1837 (WA 1837). Section 9 of the WA 1837 mandates that the will must be in
writing, signed by the testator, and witnessed by at least two persons. Moreover,
Section 15 declares any gift to an attesting witness or their spouse void. Despite these
requirements, cases like Herenden and Sellack v Harries have shown that equity
enforces secret trusts.

The Fraud Theory

Courts initially justified secret trusts by applying the maxim "equity will not allow a
statute to be used as an engine of fraud" (as seen in Rochefoucauld v Boustead).
This theory aimed to prevent a legatee who had agreed to be a trustee from later using
the statute to claim the property absolutely. Lord Westbury, in McCormick v Grogan,
and the case of Box, noted that secret trusts create a constructive trust. Lord Hatherley
LC in McCormick v Grogan held that a person who takes property by devise or
bequest with knowledge of another instrument is bound as a trustee to execute the
instructions of that instrument. If fully secret trusts were deemed unenforceable due to
non-compliance with the WA 1837, the legatee would unjustly keep the property despite
having accepted the trust obligation.

Issues with the Fraud Theory

The fraud theory encounters problems, particularly with half secret trusts. In half secret
trusts, the trust's existence is clear on the will's face, eliminating the risk of the trustee
benefiting from non-compliance with the Wills Act (Re Keen). While the fraud theory
prevents unjust enrichment of the trustee, it does not justify the beneficiary’s
entitlement. Lord Buckmaster and Lord Hailsham in Blackwell had to redefine the fraud
as not just personal gain to the trustee but the thwarting of the testator's intentions. In
Thorner v Major, the reliance of the secret beneficiary on the expectation of a gift was
addressed through proprietary estoppel. Maudsley pointed out that fraud is rarely an
issue in half secret trusts as the trust is apparent from the will.

Dehors the Will Theory

An alternative justification, the "dehors the will" theory, avoids issues with the WA 1837.
Proposed in Cullen and adopted by Viscount Sumner and Lord Warrington in
Blackwell v Blackwell, it argues that the trust is declared inter vivos (during the
testator’s lifetime) and not through the will, with the will merely effectuating the transfer.
This perspective posits that the trust arises outside (dehors) the will, thus bypassing the
WA 1837. In Re Young, the court endorsed this theory, which aligns with judicial and
academic consensus. The dehors theory suggests that the secret trust is independent
of the will.

Criticisms of the Dehors Theory

Despite its appeal, the dehors theory has flaws. Critics like Crithley argue that secret
trusts are essentially testamentary dispositions, characterized by revocability and
ambulatory nature. Therefore, they should comply with the WA 1837. Re Gardener (No.
2), where a beneficiary predeceased the testator yet passed their interest to their estate,
is controversial. If the trust constitutes at the testator's death, differing communication
rules for half secret trusts lack justification. The dehors theory also fails to address the
reliability of evidence admitted by courts and assumes an unnecessary dichotomy
between trust law and wills law.

Nature of Secret Trusts: Express vs. Constructive

Determining whether a secret trust is express or constructive is critical. In Re Baillie,

half secret trusts were considered express, requiring compliance with Section 53(1)(b)
of the LPA 1925, which mandates that trusts of land must be in writing. Fully secret
trusts, based on fraud prevention, are often treated as constructive trusts, exempt from
the writing requirement under Section 53(2) LPA 1925 (Ottaway v Norman). However,
Re Gardener suggested that an interest under a secret trust did not lapse if the
beneficiary predeceased the testator, treating the trust as inter vivos.

Modern Perspectives and Judicial Interpretations

Modern judicial views suggest no inherent conflict between Section 9 WA 1837 and
secret trusts, as secret trusts operate outside the will (Re Snowden). Pearce and
Stevens argue that secret trusts are "incompletely constituted" until the testator’s death.
The agreement and acceptance to hold property in trust occur inter vivos, with the trust
coming into effect upon the testator's death when the will transfers legal title to the
trustee. Secret trusts, therefore, create a gap in the stringency of testamentary
disposition laws, potentially conflicting with policy. Maudsley contends that statutes
create similar gaps without equity’s interference in every case. Moffat questions whether
secret trusts containing land must comply with Section 53(1)(b) LPA 1925.

Conclusion: Balancing Equity and Formality

In conclusion, the enforcement of secret trusts embodies a complex interplay between

equity and statutory formalities. The primary theories—fraud prevention and dehors the
will—each offer distinct perspectives on the legitimacy of secret trusts. The fraud theory
focuses on preventing unjust enrichment and upholding the testator's intentions, while
the dehors theory suggests secret trusts are independent of the will. However, both
theories face criticisms regarding their coherence and practical application. Ultimately,
the courts have shown flexibility in interpreting and enforcing secret trusts, striving to
balance the need for formal compliance with equitable principles. This balance ensures
that the intentions behind testamentary dispositions are honored while preventing
potential fraud. The ongoing judicial and academic debates reflect the evolving nature of
trust law and its adaptation to contemporary legal and ethical standards.
CHARITABLE TRUST

Essay 1:

The doctrine stipulating the necessity for an element of public benefit stands as a
cornerstone in charity law. Charitable organizations, in exchange for the societal
advantages they provide, are granted substantial financial privileges, such as exemption
from income tax, contingent upon their income being allocated toward charitable
objectives. A charitable purpose must not only be beneficial but also serve the public
interest. For instance, activities aimed at alleviating poverty must benefit the public to
qualify as charitable. A case in point is Re Compton, where a trust for educating the
children of specific families was deemed non-charitable. Similarly, in Re Pinion, a
donation of a studio and its contents for use as a museum failed to demonstrate public
benefit, as the court deemed the contents unworthy.

The public benefit requirement finds explicit expression in Section 2(1)(b) of the
Charities Act 2011 (CA 2011), which mandates that any charitable purpose must serve
the public benefit. Section 4 of the CA 2011 delineates the public benefit test, stipulating
in Section 4(2) that public benefit must be substantiated in all cases. However, the
precise interpretation of this provision remains subject to debate. One viewpoint posits
that, prior to the Charities Act 2006, public benefit was presumed in charitable trusts
focused on poverty relief, education advancement, and religion promotion. Conversely,
for other purposes, public benefit had to be proven. Another perspective contends that
the distinction among these categories did not presume public benefit but rather
stemmed from their established recognition as charitable purposes, thus obviating the
need for proving their benefit.

Despite the ongoing debates, the public benefit requirement retains consistency.
Section 4(3) of the CA 2011 asserts that the term "public benefit" should be understood
within the framework of existing charity law in England and Wales, thereby preserving
pre-2006 case law. The Charity Commission's statement, Public Benefit: Statement of
the Basis for the Charity Commission’s Role and Actions (December 2008), refrains
from introducing novel legal principles but reiterates the emphasis placed by the CA
2006 on the imperative for all charitable aims to demonstrably serve the public benefit.

An illustrative example of the public benefit requirement in case law pertains to trusts for
the advancement of religion. This requirement can be fulfilled in two primary ways.
Firstly, through the provision of religious activities accessible to the public, such as the
construction of church buildings or other religious endeavors like publishing literature or
conducting missionary work. In Re Hetherington, a trust for the celebration of masses
was deemed charitable because the public celebration of a religious rite was deemed
beneficial to attendees. Conversely, in Gilmour v. Coats, a donation to a community of
cloistered nuns was not deemed charitable as the benefit to the public from their
prayers was unverifiable. However, in Funnel v. Stewart, faith healing was accepted as
a public benefit, provided a sufficient religious element was present.
The second method involves the presence of individuals among the public who have
derived edification from attending a place of worship. In Neville Estate v. Madden, a
trust for the advancement of religion among members of the Catford Synagogue was
deemed charitable, despite services being limited to listed members. Trusts for
recreational purposes have presented challenges. In IRC v. Baddeley, a trust for the
"moral, social, and physical well-being" of residents in East Ham and Leyton was
deemed non-charitable due to the inclusion of social purposes and the limitation to a
specific religious group, thus lacking public benefit. Section 5 of the Charities Act 2011
permits recreational activities provided in the interests of social welfare to be deemed
beneficial, though the ruling in Baddeley remains influential.

Under the CA 2011, assessments of public benefit must incorporate guidance issued by
the Charity Commission under Section 17 of the Act. The Commission's General
Guidance includes principles like Principle 1, which necessitates identifiable benefits,
and Principle 2, which mandates that the benefit must be to the public or a section
thereof. These principles are further expounded through sub-principles and
supplementary guidance on specific areas. For instance, the December 2008 guidance
on public benefit in the advancement of religion emphasizes that purposes should not
be overly narrow, as this may yield insufficient public benefit or disregard broader
religious teachings. While the requirement for public benefit in charities is unequivocal,
its interpretation remains varied, leading to divergent opinions. Demonstrating public
benefit is crucial for charities to uphold their status and privileges, ensuring they
genuinely serve the community.

Essay 2:
Understanding the Public Benefit Requirement in Charity Law
In the realm of charity law, the necessity for a discernible public benefit serves as a
cornerstone principle. Charitable entities, in exchange for the societal advantages they
provide, enjoy substantial financial benefits, including tax exemptions, contingent upon
their income being dedicated to charitable purposes. Fundamentally, charitable
endeavors must confer benefit, and crucially, this benefit must extend to the public at
large. As such, the true essence of the charitable purpose must inherently yield benefit,
whether it be in the alleviation of poverty or the advancement of education, and this
benefit must be demonstrably public in nature. This fundamental tenet is exemplified in
legal precedents such as Re Compton, where a trust aimed at educating the children of
specific families failed the charitable test due to its lack of public benefit. Conversely, in
Re Pinon, a trust earmarking a studio for museum use faltered as the contents were
deemed unworthy, indicating a failure to provide a discernible public benefit.
The contemporary articulation of the public benefit requirement finds expression in
Section 2(1)(b) of the Charities Act 2011 (CA 2011), mandating that any charitable
purpose must inherently serve the public benefit. Section 4 of the CA 2011 further
delineates the public benefit test, requiring proof of public benefit in all cases. However,
the precise interpretation of this requirement remains ambiguous. One interpretation
posits that prior to the CA 2006, public benefit was presumed in charitable trusts
dedicated to poverty relief, education, and religion advancement, while proof was
requisite for all other purposes. Conversely, an opposing viewpoint suggests that the
presumption of public benefit did not apply solely to the first three charitable purposes
but rather stemmed from the inherent recognition of their charitable nature. This
distinction underscores the enduring nature of the public benefit requirement, which
forms the crux of charitable endeavors.
Section 4(3) of the CA 2011 further elucidates that any reference to public benefit must
align with its understanding within the legal framework governing charities in England
and Wales. This provision effectively preserves existing case law, underscoring the
continuity in the interpretation of public benefit. Notably, the Charity Commission's
December 2008 statement on Public Benefit reaffirms this position, emphasizing that
the CA 2006 accentuated the imperative for all charitable aims to demonstrably serve
the public benefit, rather than effectuating new legal standards.
Legal precedent provides valuable insights into the concept of public benefit, particularly
in the context of trusts dedicated to religious advancement. Such trusts may fulfill the
public benefit requirement through two primary avenues. Firstly, by offering religious
activities accessible to the public, trusts aimed at constructing church buildings or
facilitating religious publications exemplify public benefit. In Re Hetherington, a trust
dedicated to the celebration of masses was deemed charitable as it was construed to
edify and improve attendees, thus serving a public purpose. Conversely, in Gilmour v.
Coats, a gift to a community of cloistered nuns failed the charitable test due to the
intangible nature of the public benefit derived from their prayers, highlighting the
necessity for tangible public benefit.
Secondly, trusts for religious advancement may demonstrate public benefit through the
edification of individuals within the public domain who have attended religious services.
In Neville Estate v. Madden, a trust aimed at advancing religion among members of a
synagogue garnered charitable status, despite restricting access to services exclusively
to listed members. This ruling underscore the significance of tangible public benefit
derived from participation in religious activities within the broader community.
The realm of trusts dedicated to recreational pursuits has posed significant challenges
in meeting the public benefit requirement. In IRC v. Baddeley, a trust aimed at promoting
the moral, social, and physical well-being of residents in specific areas was deemed
non-charitable, primarily due to its social objectives. Moreover, the trust's potential
limitation to a specific demographic further detracted from its public benefit. Despite
subsequent legislative provisions such as Section 5 of the Charities Act 2011, which
permits recreational activities in the interests of social welfare to be considered
beneficial, challenges persist in delineating tangible public benefit within recreational
trusts.
Under the CA 2011, considerations of public benefit must incorporate the guidance
issued by the Charity Commission under Section 17 of the Act. This guidance,
encompassing overarching principles and specific directives, underscores the
multifaceted nature of public benefit evaluation. For instance, the Commission's
guidance on the advancement of religion acknowledges that the charitable status of
religious organizations hinges on their adherence to broader religious teachings, while
ensuring a sufficiently broad public benefit without compromising religious principles.
Conclusion
In conclusion, the interpretation of the public benefit requirement in charity law remains
a cornerstone of charitable endeavors. Whether in the realms of education, religion, or
recreation, charitable entities must unequivocally demonstrate their capacity to serve
the public good. While legislative amendments such as the CA 2011 have reinforced the
imperative for public benefit, legal precedents and judicial interpretations continue to
shape the contours of this fundamental requirement. As charitable organizations
navigate the complexities of public benefit evaluation, adherence to legal principles and
regulatory guidance remains paramount in securing and maintaining charitable status.
Through a nuanced understanding of public benefit, charities can effectively fulfill their
altruistic missions while upholding the public trust bestowed upon them.