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Summary Equity & Trusts: The Three Certainties
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This document contains a condensed overview of the three certainties.
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EQUITIES & TRUSTS: Lecture NotesCertainties 1
Three Certainties
1. “if the words are so used, that upon the whole, they ought to be construed as
imperative”
2. “if the subject of the recommendation or wish be certain”
3. “if the objects or persons intended to have the benefit…be also certain”
• Wright v Atkyns (1823) per Lord Eldon
• Knight v Knight per Lord Langdale MR
How to answer a problem question?
1. Who stands to gain?
2. What do they stand to gain?
3. How can they gain it?
4. Can they be stopped?
Certainty of Intention
• Oral or in writing: Moore v Williamson [2011]
• Unless land: s.52(1)(b) LPA 1925
• Or a subsisting equitable interest: s.52(1)(b) LPA 1925
Intention to do…what?
1. Intention to give up all interest in the property?
2. Intention to create a trust?
• No, because not many people know what a trust is — has to be an intention to create
one. Has to know.
3. Intention to place a mandatory obligation on the transferee?
4. Intention to benefit the object in equity?
• No, very niche as it requires expert knowledge
Need to look at the wording
• Look beyond the word trust
• Trust might not be intended
• Sometimes the word trust isn't used but is intended
• Tito v Waddell (No 2) [1977]
• Island of UK colony
• Rich in phosphates
, EQUITIES & TRUSTS: Lecture Notes
• UK took natural resources
• Hold our profit on trust for the islanders
• MJ Migary: did they intend to bind themselves to a mandatory obligation? — no
they didn't mean it like that (decided to the shame of the court)
• Testator might not know what a trust is — if you don't know what it is means there is
no intention
• Re Freud [2014]
• Death of painter, Lucien Freud
• Just because the word trustee was used in will does not mean that there was a trust
• Need mandatory language
Mandatory and Precatory Language
1. You must (mandatory)
2. I wholeheartedly beseech you (not mandatory)
Slippery Semantics
• “…to be at her disposal in any way she may think best, for the benefit of herself and her
family”,
• Lambe v Eames
• Not seen to create a trust obligation
• “unto and to the absolute use of my dear wife…in full confidence that she will do what is
right as to the disposal thereof between my children”
• Re Adams and Kensington Vestry [1884]
• Not a trust
• “In full confidence that…”
• Comiskey v Bowring-Hanbury
• Trust
Contextual
• Re Steele’s WTs (1948)
• Diamond
• Language sounded precatory
• Used language from Shelly v Shelly
• Court said that the phrase was precatory so showed intention to create a trust
Testamentary Dispositions
• Objective/subjective meaning
• Pearson v Lehmann Bros Finance SA and others [2010]
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