Chapter 5: Resulting Trusts

Flashcards covering Chapter 5: Resulting Trusts, including presumed resulting trusts, the presumption of advancement, rebuttal rules, automatic resulting trusts, and statutory formalities.

What is a resulting trust and how is title split between the parties?

A resulting trust is an implied (not express) trust where the transferee holds the legal title and the transferor keeps the equitable interest.

What is the legal function of presumptions in resulting trusts, and when do they apply?

They only allocate the burden of proof and apply when there is no evidence of intention.

What presumption arises upon a voluntary transfer of personalty when A gives property to B for free?

A resulting trust for A.

Under LPA 1925 s 60(3), what presumption arises upon a voluntary transfer of land?

There is no automatic presumption; it needs extra evidence or factors, though this is not free from doubt.

What presumption arises in a purchase money situation where X pays and the property goes into Y's name?

A resulting trust for X.

What presumption arises from a part contribution to the purchase price, and what conditions must the contribution satisfy?

A resulting trust arises in proportion to the contribution (e.g., Tess $10\%$, Maggie $90\%$). Contributions must be contemporaneous with the purchase and go to the price itself (not legal fees).

To which specific transferor-transferee relationships does the presumption of advancement (gift) apply?

It applies from: father to child (minor or adult); person in loco parentis to child (usually ends at $18$); husband to wife; and fiancé to fiancée, if they later marry.

What presumption applies when a transfer is made from a wife to a husband or from an adult child to a father?

The presumption of advancement is not reversed; a transfer from wife to husband or adult child to father gets the resulting trust presumption.

What is the status and effect of Equality Act 2010 s 199 regarding the presumption of advancement?

Equality Act 2010 s 199 would abolish the presumption of advancement, but it is not in force.

What rules govern the timing and admissibility of evidence used to rebut the presumptions?

Evidence of the transferor's intention before or at the time of transfer is admissible. Later acts or declarations are admissible only against the person who made them, never in their favour.

In the Allen example, what evidence successfully rebutted advancement, and what evidence was ruled inadmissible?

Retaining the title deeds and wanting his son-in-law to repay the price rebutted advancement, but his later document dividing the house was inadmissible.

In the sample question cited, what evidence successfully rebutted the presumption of advancement?

A contemporaneous email instructing the son to forward dividends and share documents.

What is an automatic resulting trust, and to whom does the equitable interest result when an express trust fails?

It occurs when an express trust fails: trustees hold legal title but nobody has equitable title ("equity abhors a vacuum"). The equitable interest results back to the settlor, or to their residuary beneficiary or next of kin if they have died.

On what kind of trust do trustees hold property after an express trust fails, and what rule can be used?

Trustees hold on a bare trust, so Saunders v Vautier can be used.

What are the four situations listed where an automatic resulting trust arises because a declared trust is void or does not exhaust the fund?

1. No beneficiary attains a vested interest (e.g., Laura dies at $22$ before $25$); 2. Uncertain objects ("my best friends"); 3. Uncertain interests ("a decent amount to Ruby"); 4. Breach of the perpetuity rules (e.g., inalienability of capital) or the beneficiary principle.

What formalities are required to create an implied or resulting trust under LPA 1925 s 53(2)?

None. Implied trusts need no signed writing under LPA 1925 s 53(2), unlike express trusts of land.

What are the three steps outlined in the exam pointers for analyzing transfer presumptions?

Step 1: which presumption applies? Step 2: any rebutting evidence? Step 3: is it admissible (timing)?