Topic 2: Express and Secret Trusts

Formalities for creating a trust

✅ Usually: No formalities, no writing needed but there are 3 exceptions.

3 exceptions to the general rule on formalities of a trust:

Trust must be in writing if trust:

1. Involves land (Statute of Frauds).

2. Made in a will (Succession Act).

3. Part of a marriage contract.
   
   ➕ ALSO: Transferring a beneficiary’s interest requires writing.

1. Trust over Land

s.4 of the Statute of Frauds (Ireland) 1965

• Requires trust must be in writing and signed my someone able to declare trust or declared by a will

• Trust will not be enforceable if not in writing but will not be strictly invalid (may become enforceable later on evidence of writing)

• Declaration of trust itself does not need to be in writing.

Exception to s. 4 of the Statute of Fraud (Ireland) 1695

Equity won’t let the statute be used for fraud (e.g., oral trusts enforced to prevent injustice).

Bannister v Bannister [1948]

• Widow sold property cheap based on buyer’s oral promise to hold it for her.

• Buyer went back and said it wasn't in writing so it was invalid.

• Constructive trust imposed to prevent fraud.

• Rule: Equity overrides the Statute of Frauds to prevent unjust enrichment.

Rochefoucauld v Boustead [1897]

• Suggests writing in evidential and not a rule of law

• Buyer agreed to buy estates from seller but it was orally agreed that they were to hold the estates on trust for them. Seller would pay buyer back.

• In contravention of his promise, the buyer mortgaged the estates and sold the estate to pay off the debt

• Original seller argued that the estate was held on trust for her

• Held: Express trust enforced despite lack of writing to prevent fraud.

McGillycuddy v Joy [1959]

• Rochefoucauld principle applied in Ireland

• Defendants had agreed to purchase a farm jointly with the plaintiff

• Plaintiff paid 1/3 for farm.

• Then defendants went back on the agreement.

• Budd J held that the defendants held the benefit of the contract of sale on trust for the plaintiff.

Staden v Jones [2008]

• A transferred land to B orally for C

• B tried to keep it.

• Held: C could enforce the trust (not just A).

• Rule: Prevents B’s fraud by letting the intended beneficiary (C) claim.

Contrast this with Soloman v. McCarthy where the land went back to A to prevent unjust enrichment

Irish courts have not addressed this issue of 3rd party enforceability!

Paul v Constance [1977]

• Man told cohabitant that his bank account money was ‘as much yours as mine’

• Oral declaration created valid trust (no writing needed for personal property).

• Clear intention can create a trust without formalities.

Critiques of court’s approach to s.4 of the Statute of Frauds:

• Some argue courts are too flexible in enforcing oral trusts by labeling non-compliance as "fraud"

• Merely relying on statutory formalities shouldn't automatically equal fraud

Current Law:

• Nevertheless well-established that:
  ✅ Equity will enforce oral trusts to prevent unconscionability (Rochefoucauld)
  ✅ "Fraud" interpreted broadly (includes unfair advantage-taking)

2. Contracts to create a trust in consideration of marriage

s.2 of Statute of Frauds:

• Required these contracts to be in writing OR

• Evidenced by written note or memorandum

Example: prenup, dowry, ‘if we marry I will put X in trust for our future kids’

3. Trusts Created by Will

s. 78 of Succession Act 1965:

• in writing

• signed by testator, or someone at their discretion

• signature made and acknowledged in the precedes of 2 witnesses present at the same time, must attest the signature.

Exceptions exists (secret trusts)

Disposition of Equitable Interests Held Under Trust

s. 6 of the Statute of Frauds (Ireland) 1695

all subsequent dispositions of beneficial interests must be:

• in writing and signed by person making the disposition

• be included in the will

Applies to existing trusts over any kind of property, not just land.

The 3 Certainties

Required for express trusts:

1. Certainty of Intention

2. Certainty of Subject Matter

3. Certainty of Objects

NB: not needed for resulting/constructive

Knight v. Knight (1840)

• Testator left estate to his son and directed his wish that all descendants of male bloodline carry it on

• Son died intestate and childless so brother settled estate

• Court held there was not sufficient certainty in his intention (precatory words), the subject matter (had five different estates) nor the object (beneficiary cannot be worked out)

• Trust not upheld

• Lord Langdale MR established the 3 certainties requirement

Chambers v. Fahy [1931]

• Applied Knight v. Knight’s 3 certainties in Ireland

• O’Byrne J:

   

  “it has been established that, in order that a trust may be created, the subject matter must be certain, the objects of the trust must be certain and the words relied upon as creating the trust must have been used in an imperative sense so as to show that the testator [or other settlor] intends to create an obligation.”

• Dispute between the trustee brother of deceased and daughter who claimed she got unequal share.

• Cork Court held that 3 certainties were met so trust was valid, including imperative wording of ‘as he sees fit’ to distribute unequally.

   

Mussoorie Bank v Rayner (1882)

• The three certainties (intention, subject-matter, objects) are interrelated.

• Uncertainty about the subject matter can reflect back and undermine certainty of intention.

Certainty of Intention

• The use of the word ‘trust’ is not necessary (but using it does not automatically create a trust)

• The settlor must clearly intend to create a legally binding trust (not just a wish or moral obligation).

• Imperative language proves it.

Precatory words

• hope, request, wish

• generally not sufficient to create a trust unless the context clearly indicates an imperative obligation

Re Adams and the Kensington Vestry (1884)

• Testator left property to his wife with the words "in full confidence that she will do what is right.”

• These were considered precatory words, insufficient to impose a legal obligation.

• No trust was created.

Re Sweeney [1976 - 77]

• A gift to the testator’s wife was followed by a statement that it was "subject to the express wish" that she would pay certain legacies.

• No trust was created; the language lacked imperative force.

Comiskey v. Browring-Hanbury [1905]

• Will included precatory words. ‘in confidence’ but also had strong language elsewhere indicating an intention to create obligations.

• The court found that, when the document was read as a whole, a trust was intended.

Failure of certainty of intention

• 😶Precatory words (e.g., "I wish") → Absolute gift (Re Adams).

• ❌ Ambiguous intent → Resulting trust for settlor (Mussoorie Bank).

• 🚫 Sham → No gift, no trust (Midland Bank v Wyatt).

Vucicevic & Anor v Aleksic & Ors [2017]

• The testator expressed confidence in an individual to direct assets to a charitable cause.

• Despite vague language, “I am having full confidence in Vladika Amfilohije Radovic that is going in right place in Kosovo only”; read in the context of the terms of the will, this did not prevent the creation of a charitable trust.

Sham Trusts

• Courts may look behind a declaration of trust to ascertain genuine intention

Midland Bank plc v Wyatt [1995]

• It was held that the defendant had not really intended to create a trust by his declaration.

• The document purporting to create a trust in favour of the defendant’s wife and children had been created ‘not to be acted upon but to be put in the safe for a rainy day’

HKR Middle East Architects Engineering LC & ors v. English.

• Irish court

• McDonald J relied on Wyatt in reaching the conclusion that the trust in question was a sham, also using the “rainy day” metaphor.

 

Certainty of Subject Matter

• The trust property must be clearly defined with sufficient certainty.

• Specific assets (e.g., "my London flat," not "some of my money").

• Tangible vs. Intangible:

  • 🧱 Tangible (e.g., a painting): Must be identified (Re London Wine).

  • 📜 Intangible (e.g., shares): No need to segregate (Hunter v Moss).

Palmer v Simmonds (1854)

• ‘the bulk of my residual estate’ = trust failure

• bulk held to be an uncertain term and too vague to identify correctly

Re Golay’s Will Trusts [1965]

• The testator left a gift of a "reasonable income" to a beneficiary.

• The court held this was sufficiently certain, referring to the beneficiary's standard of living.

Hunter v. Moss [1993]

• Trust was declared over 50 shares out of 950 owned by the settlor, without identifying which specific shares.

• Upheld as valid because the shares were identical and fungible.

Re London Wine Company [1986]

• Segregation of chattels from a bulk is required for the subject matter of a trust to be certain.

• Wine were all different so could not figure out what subject matter was.

Certainty of Objects

• The beneficiaries must be identifiable.

• Fixed Trust = beneficiaries and their shares are predetermined

• Discretionary Trust = trustee must distribute but have discretion over who benefits and in what capacity

Fixed Trust Requirements

1. Conceptual Certainty

   • all beneficiaries must be identified

   • can we understand the idea of the group? e.g my children can be understood but ‘my drinking mates’ is too vague.

   • The Court will make a special effort to find conceptual certainty in order not to frustrate settlor’s intention (O’Byrne v. Davoren)
     

2. Evidentiary Certainty

   • enough proof to identify beneficiaries

   • Do we have enough evidence to actually identify who is in the group described in the trust?

     • Even if the group is clearly defined conceptually (like “my employees”), you might still struggle to find records or proof of who those people are. This s an evidential issue.

     • It’s not about what the words mean, but whether we have enough information to apply those words in the real world.

Sub category of evidentiary certainty: special treatment for problems of “ascertainability”:

Where problem arises concerning the existence or whereabouts of known beneficiaries there are 2 options:

1. Distribute on the basis that they are dead as per Re Benjamin [1902]

2. Pay beneficiaries share into court, allowing reasonable time for them to claim it. If not, court can then distribute.

Discretionary Trust Requirements

Ireland: Complete Test Applied

England: ‘Is or is Not Test’

🇮🇪 Re Parker’s Will; Kilroy v Parker [1966]

• Trustees had discretion to benefit "necessitous nieces and nephews and their children."

• The court found conceptual certainty and upheld the trust.

🇮🇪O’Byrne v Davoren [1994]

• Discretionary trust; issue of evidential and conceptual certainty arose.

• Murphy J preferred the stricter Broadway Cottages approach, emphasising evidential certainty.

• Murphy J also obiter preferred Parker over to McPhail but unsure why

• Possible Irish courts would take a different approach and follow Baden’s in a future case.

🇬🇧 IRC v. Broadway Cottages Trust [1955]

• Established the strict ‘complete list test’ for both discretionary and fixed.

• Conceptual and evidentiary certainty required.

• Held that for a trust to be valid that a full list of potential beneficiaries must be ascertainable as per Jenkins LJ.

Justifications for Broadway Cottages

1. Trustee cannot perform duty unless he or she knows all possible beneficiaries.

2. If the trustees default then court must be able to divide into equal shares.

McPhail v Doulton [1971] (Re Baden (No 1))

• Discretionary trust challenged for lack of certainty of objects.

• House of Lords adopted a more lenient "is or is not" test, overruling Broadway Cottages for discretionary trusts

• Test originated from Re Gulbenkian [1970]

Rational for new Badens 1 test:

1. Trustee does not need to list every single person, they just need to understand the size and nature of the group

2. Court can order a scheme to be drawn up if necessary – equal division would often be absurd because of different circumstances.

Power of Appointment

• A power of appointment gives a donee the power to choose who gets property from a defined group (class of objects).

• NOT a trust but can exist within one.

• More flexible than a trust.

• Legal questions arise with certainty of objects.

• Gift over = beneficiary dies or does not fulfil condition it used to say who will get property next.
  

📌 Example:

Property is held in trust for Kate for life.
After her death, Kate can choose (appoint) which of her children gets the remainder, by deed or will.
If she doesn’t choose, the property goes to all her children equally (the “gift over”).

So, Kate holds a power of appointment over the trust property.

🇬🇧 Re Gulbenkian [1970]

• House of Lords said that for powers of appointment, the legal test is more relaxed than for trusts.

• It’s enough if you can say of any individual person:

“Is this person in the class or not?”

You don’t need to list everyone — just test individuals one by one.

This became known as the “is or is not” test.

🇮🇪 Re Bayley; Brown v Gregg [1945]

• Ireland is even more flexible with the POA test

• It’s enough to show that a person is capable of being a member of the class.

Re Baden’s Deed Trusts (No. 2) [1973]

• Applied McPhail

• Court considered how the new test would function.

• Sachs LJ held the onus is on claimants to prove they are within the class.

• The Court of Appeal considered whether the terms ‘relative’ and ‘dependant’ were conceptually uncertain

• It was held that they were both capable of being defined with sufficient certainty, so the trust was valid

  • ‘Relative’ could be rendered certain if interpreted to mean ‘descendants of a common ancestor’: although that sounds confusing too as we all descend from a common ancestor

  • Once conceptually certain, it then becomes a question of evidence as to whether any postulant can be proved to fall within it (Sachs LJ)

  • The court also said where there is a wide class of beneficiaries (e.g. ex-employees of large company) trustees cannot just wait for postulants to come forward → trustees must make a survey of the class to get a feel for who is potentially in class when exercising their discretion

  • Stamp LJ said that this is NOT the same as a requirement to make a list

Administrative unworkability

• Definition so wide as to form “nothing like a class” per Lord Wilberforce in McPhail v Doulton (above)

• Application in Ireland remains unclear

R v District Auditor, ex parte West Yorkshire CC (1986)

• Testator intended to benefit the whole population of West Yorkshire by leaving a trust to 2.5 million people

• Struck down for unworkeability

Capriciousness

• Trust fails because the settlors choice or criteria are irrational or absurd

• Not necessarily about numbers e.g anyone wearing white

Charitable Trusts

• Exempt from certainty of object requirement

Mogridge v Thackwell (1803)

• A charitable gift was challenged due to vagueness and uncertainty about how the property was to be distributed.

• Charitable intention was enough; specific objects did not need to be certain.

• Court upheld gift using charitable law principles including cy-près.

Constituted a Trust

Trust must be transfered to be valid
i.e the trust property must be transferred to the trustee, or the trustee must declare himself or herself trustee over property he or she already owns.

Constituting a Trust: The settlor makes himself or herself trustee

Self-declaration of trust only became a possibility comparatively late in the development of equity: Re Pye (1811)

Re Ellenborough [1903]

• Settlor tried to declare a trust over property they expected to inherit in the future.

• A trust over property not yet owned is ineffective — unless it forms part of an enforceable contract to transfer the property once acquired.

Miller v. Harrison (1871)

• Once a settlor has a validity declared trust over his property, it is no longer open to them to recover it

Jones v. Locke (1865)

• A man gave a cheque to his infant son, saying “Look you here, I give this to baby; it is for himself.”

• He died a few days later.

• He tried to make a trust over his own property but failed - he didn’t complete the transfer or declare a trust.

• An ineffective gift does not automatically become a trust.

• Casual statements aren’t enough.

• X neither gift or trust

T Choithram Int’l SA v Pagarani [2001]

• Settlor verbally declared a gift to a charitable foundation at bedside ceremony declaring ‘I now give all my wealth to the trust’

• Died soon of cancer after without signing documents and transferring the property.

• Although some of the required legal formalities (like share transfers) were incomplete, he was one of the many trustees named in the trust deed.

• His children challenged the gift as incomplete and unenforceable.

• Lorde Browne Wilkinson:

  • ‘although equity will not aid a volunteer, it will not strive officiously to defeat a gift’

  • His intention to give the property to the trust could be treated as a self-declaration of trust, since he was also a trustee.

  • The failure to complete formal transfer to the other trustees was not fatal.

  • Equity would not allow his intention to benefit charity to be frustrated.

• Trust upheld even without formal transfer of property.

Comments: T Choithram International SA v. Pagarani [2001]

• Established = a person who declares a gift to a trust, where they are one of the trustees, may be treated as having declared themselves trustee.

• The case slightly stretched the rule in Milroy v Lord to avoid injustice, prioritising intention and fairness.

• Court interpreted the words of a gift to be a valid trust, meaning it got around the rule that it would not perfect an imperfect gift

• It is seen by many as bending the rules to uphold a large charitable donation.

• Widely discussed as a rare exception where equity appeared to prioritize substance over form.

• Some legal commentators view it as doctrinally shaky and potentially inconsistent with previous case law on imperfect gifts.

🇮🇪CC v NC [2012]

• Abbot J rejected an argument that was based on T Choithram

• The settlor was one of two trustees of the alleged trust.

• The property was vested in the settlor and no steps were taken to vest it in both trustees.

• Unlike T Choithram, there was no declaration of trust by the settlor.

• The trust was intended as a ruse to defeat creditors, influencing the judge's decision.

Constituting a Trust: The settlor makes someone else a trustee

• Settlor must do everything possible to transfer the property effectively (Milroy v. Lord)

• Intention to transfer = not sufficient

Milroy v Lord [1862]

• An incomplete attempt to transfer property to a volunteer under a trust.

• There is no “equity to perfect an imperfect gift” to a volunteer (i.e someone who has not provided consideration)

• Proper transfer method must be used.

🇮🇪 McArdle v. O’Donoghue [1999]

• Settlor contemplated transferring £100k to trust for children

• Purchased investment in his own name and never made the transfer

• Trust = not constituted

Re Rose [1952]

• Exception to equity will not assist a volunteer if the transfer is not completed

• If settlor has done everything in his power to transfer the property to a trust but not all formalities were met, without faulty of the settler the trust will be regarded as completely constituted.

• The donor completed all actions necessary for a share transfer, but formal registration of transfer by directors occurred later.

• Legal interest passed when directors registered shares

Devoy v Hanlon [1929]

• Concerned transfer of registered land

• Supported application of Re Rose principle in Irish context.

🇬🇧 Pennington v Waine [2002]

• Controversial extension of Re Rose.

  • undermines the clarity of the rule

• Aunt intended to transfer shares to nephew.

• She signed a form but did not complete registration i.e she did not do everything in her power to complete the transfer

• Others who stood to inherit argued it was imperfect and not valid, but nephew argued as they were held on trust for him.

• The court held it would be unconscionable to revoke the gift; trust upheld despite imperfect transfer.

• Relied on Brown-Wilkinson quote from T Choithram that “equity will not strive officiously to defeat a gift”.

• Unsure if Irish law will follow this

Paul v Paul [1882]

• Trust property had already been transferred to trustees.

• Even if beneficiaries are volunteers, settlor cannot recover property already validly transferred.

Exceptions to the rule that ‘Equity will not assist a volunteer’

a. The Rule in Strong v. Bird

b. Donatio Mortis Causa

c. Proprietary Estoppel

Strong v Bird [1874]

• Step-mother tenant informally forgave a debt to step-son landlord while she was alive via a reduced rent arrangement.

• She was meant to pay be repaid by a lower rent but only did this twice and paid full rent until her death

• Step-son later became executor of the estate upon her death but her next-of-kin wanted what was left of the debt repaid.

• The legal title that was vested in the step-son as the executor completed the gift.

  • it would have made no sense for him to sue himself

  • her intention carried on until death so this showed intention

Requirements: Rule in Strong v. Bird

1. The donor must have intended to make an inter vivos gift.

2. Such donative intention must have persisted until the donor's death.

3. The donee is appointed the donor's executor (or administrator, Re James [1935] 1 Ch 449)

4. The subject matter of the intended gift must have been capable of enduring the death of the donor.

Re Stewart [1908]

• An imperfect gift not involving debt.

• The Strong v Bird rule extended beyond debt forgiveness.

Re Freeland [1952]

• Donor promised a car but lent it to another person before death.

• Intent to make a gift had changed.

• Strong v. Bird = intent must continue until donor’s death so rule did not apply.

Re James [1935]

• Donee became administrator of donor’s estate (intestacy).

• Court applied Strong v Bird rule even where appointment wasn’t by the deceased.

Re Gonin [1979]

• Criticised Re James, arguing that because the deceased person does not choose their administrator, like they do the executor, so does not reflect the donors intention.

• Issue with this critique = in most cases, donors think the gift was already complete when they gave it so it's fiction to say they consciously perfected it later by appointing the donee as executor. The whole idea of "intent to perfect" might be more of a legal convenience than real human intention.

Re Ralli’s Will Trusts [1964]

• Property reached the trustee by a route other than originally intende but court held that pnce property vests in the correct trustee, the means of vesting is irrelevant.

• Helen had promised to transfer any future property to her trustee (T) under a trust. Later, T received property under a will, to hold on trust for Helen.

• Since the property had reached the correct trustee, the court held it must be held on trust for Helen’s beneficiaries — the method of transfer didn’t matter.

DONATIO MORTIS CAUSA

• A conditional gift made in contemplation of death.

• Idea that someone on their death bed shouldn’t have to comply with the same formalities as a healthy person when transferring property.

• If the donor recovers/survives the perceived threat to his or her life, or changes his or her mind, then the gift is automatically revoked.

• If the donor dies, the gift is perfected even if the proper mechanism for the transfer of the property has not been employed (and it is in this context that the doctrine operates to perfect an imperfect gift).

Requirements for DMC

• Contemplation of death

• Symbolic or actual delivery of subject matter of gift

• Gift be expressly or impliedly made conditional on death - can be satisfied even if the donors illness is fatal.

🇮🇪 Bentham v. Potterton [1998]

• Annie (86, terminally ill) gave her grandniece, Mary, bank books (£14,000+) from her suitcase, instructing her to store them in a safe.

• The next day, Annie said: "If anything happens to me, keep the money and give Sarah [her goddaughter] a few bob." She died weeks later.

• Mary claimed this was a DMC gift, overriding Annie’s will (which left smaller legacies to Mary/Sarah).

• Court’s Holding: No valid DMC—Annie lacked clear intent to gift (delivery was for safekeeping, not transfer), and she didn’t truly contemplate imminent death at the time.

• safekeeping ≠ intent to transfer ownership.
  

🇬🇧 King v. Dubrey [2016]

• English case that seems to restrict scope of DMC

• Court emphasised the anomalous nature of the doctrine and seemed determined to restrict its scope.

• Donor was 81 but not suffering from any illness

• Held that the requirement of gift made in contemplation not satisfied.

Sen v Headley [1991]

• DMC of unregistered land

• Donor gave keys and documents to donee.

• Valid DMC despite earlier case law concerns over transferring dominion of land.

Rahman v Hassan [2024]

• Claimed DMC over registered land and online accounts.

• Court upheld DMC; possibly broadening scope to new property types.

PROPRIETARY ESTOPPEL

• may apply where the owner of land has led another person, whether by encouragement or acquiescence, to act to their detriment. 

• Here equity intervenes to protect someone who is strictly speaking a volunteer, since they have not given consideration under a contract.

 

COVENANTS TO SETTLE

Deed under seal where a settlor promises to transfer property to trustees (e.g., for a marriage trust). Though binding on the settlor, beneficiaries cannot enforce it unless they:

1. Provide consideration, or

2. Are party to the deed (under Law of Property Act 1925, s. 56).

Because "Equity will not assist a volunteer" – mere beneficiaries lack standing to sue.

Enforcement by the Beneficiary

• On normal contract principles, the beneficiary will only be able to enforce the contract if he has provided consideration. 

• Equity and the common law differ in their interpretation of the concept of consideration.

Pullan v Koe [1913]

• Marriage settlement included wife and children (recognised only by equity')

• Consideration of marriage allowed enforcement by beneficiaries (specific performance)

Cannon v Hartley [1949]

• Beneficiary was party to a deed with the settlor.

• Could sue for damages at common law, but not enforce trust in equity.

Re Plumptre’s Marriage Settlement [1910]

• Next-of-kin claimed under a marriage settlement.

• Not within marriage consideration (Pullan) nor party to deed (Cannon); could not enforce .

Enforcement by the Trustees on Behalf of the Beneficiaries

• 🇬🇧 Even though trustees could sue and hold damages for beneficiaries, English courts have rejected this idea in some cases.

• Key Point = the "privity of contract" (i.e only parties to a contract can enforce its terms or be bound by it.) blocks beneficiaries, and trustees haven't been allowed to bypass it either.

• 🇮🇪 It is possible that Irish courts could take a different view!! (as the English courts were lower courts)

🇬🇧 Re Pryce [1917]

• Trustees sought to enforce a covenant to settle.

• Court held trustees should not be compelled to sue.

🇬🇧 Re Kay’s Settlement [1939]

Trustees were instructed not to pursue legal action to enforce settlement.

Fletcher v Fletcher [1844]

• A promise was interpreted as forming a trust of the benefit of the covenant

• Court found a trust, but the evidence was dubious

• Approach seen as outdated but theoretically relevant.

Secret Trust

• on the face of the will, gift appears to be absolute but in reality there is a private agreement for the receipt to hold this on trust for someone else.

• Secret trusts need court intervention to stop theft because otherwise, the will just looks completed and the trustee could commit fraud.

• Will is revocable so does not matter if communication and acceptance is before or after will

• Acceptance may be inferred from silence where response could have been accepted

McCormick v Grogan [1869]

• Claimant argued for enforcement of fully secret trust.

• Early rational of secret trusts = enforced to prevent fraud; statutory formalities will not defeat testator’s intention if fraud would result.

• Lord Westbury set out three requirements necessary for existence of a secret trust:

  1. intention

  2. communication of the donors intention during lifetime AND

  3. has to be acceptance on the part of the legatee or secret trustee of the trust obligation

Wallgrave v Tebbs [1855]

• Instructions for fully secret trust found after testator’s death, not communicated during life.

• No valid fully secret trust

• secret trust = communication must occur before death.

Half-Secret Trust

• Existence of trust is disclosed but does not say for who/it’s nature.

• No fraud risk (the will already says it's held in trust)

• Courts are stricter about enforcing half-secret terms because there's no emergency "fraud" to prevent, it just results to estate if it fails

🇮🇪 Riordan v Banon [1876]

• Irish courts enforced the half-secret trust.

Blackwell v Blackwell [1929]

• House of Lords upheld a half-secret trust.

• Viscount Sumner's theory: The trust operates dehors (outside) the will.

  • An inter vivos trust is created during the testator’s life when they declare the trust to the trustee.

  • The will merely "constitutes" (formalises) this pre-existing trust.

---

🇮🇪 O’Brien v. Condon [1995]

• Beneficiary under a Fully Secret Trust had witnessed the will

• Legislation says that witnesses cannot get a gift from will

• Despite this, she could still benefit

• This supports the dehors the will theory

Critchley (1999) critique of ‘dehors the will’

• Secret trusts are testamentary dispositions (not inter vivos), so they should comply with wills legislation (e.g., writing/witnessing requirements in Succession Act 1965).

• Flaw: If truly outside the will, why does the trust only take effect on death? Contradicts lifetime trust principles.

🇬🇧 Re Keen [1937]

• Timing Requirement:

  • Communication and acceptance of trust terms must occur before the will’s execution.

  • ENGLAND ONLY

• Consistency Requirement:

  • Terms must match the will’s express language (e.g., cannot contradict the will’s wording).

• Controversial Basis:

  • Criticised for falsely analogising with incorporation by reference (where pre-existing documents referred to in the will become part of it).

  • Problem: Incorporation destroys secrecy, but half-secret trusts aim to keep terms private.

Key Contrast:

• Ireland (Re Prendiville) rejects the timing rule—allows post-will communication.

🇮🇪 Re Prendeville [1990]

• Half-secret trust case in Ireland.

• Rejected UK Re Keen rule that communication must occur before execution of will; no requirement of consistency with will.

• Joseph left everything to his wife Mary in his will, saying she should follow his secret instructions.

• He wrote secret instructions giving specific gifts to kids (like £3,000 to Brendan, house to Billy)

• Mary knew about these instructions and agreed to follow them

• After both died, kids fought over whether these secret gifts were legally binding

• Court held it was for the house gift (because Mary agreed to it while Joseph was alive), but other gifts were too vague

• It did not matter that the secret instructions were given before the will.

  • they are binding in Ireland if the person getting the property (Mary) knew and agreed to them during the giver's (Joseph's) lifetime