Trusts flashcards

Penn v Lord Baltimore (1750)

Equity acts in personam — the Court of Chancery could enforce an agreement concerning land in America against the defendant personally, even though the land was outside the court's territorial jurisdiction. Foundation for the personal nature of equitable jurisdiction.

Crabb v Arun District Council [1976]

Foundational proprietary estoppel case. Lord Denning MR articulated equity's role in remedying detrimental reliance on assurances. Crabb relied on assurance of right of access; council's denial held unconscionable. Granted easement.

Bibby v Stirling (1998)

Court of Appeal case on proprietary estoppel — confirms that detrimental reliance on assurance can give rise to an equitable interest in land.

Cobbe v Yeoman's Row Management Ltd [2008] UKHL 55

PE narrowed in commercial context. Lord Scott: claimant knew the agreement was not legally binding ('subject to contract') and so could not reasonably rely on it. PE not available where claimant knew there was no legally enforceable promise.

Thorner v Major [2009] UKHL 18

Reaffirmed and broadened PE in domestic/family context after Cobbe. Assurances need only be 'clear enough' in context. David worked on cousin's farm for years on basis of assurances he would inherit. Estoppel established.

Guest v Guest [2022] UKSC 27

Leading modern PE case on remedy. Lord Briggs: aim of remedy is to prevent unconscionable conduct, not strictly to fulfil expectation or compensate detriment. Court has flexibility — may be either, depending on what's needed to undo unconscionability.

Gillett v Holt [2001] Ch 210

PE — assurances + reliance + detriment must be looked at 'in the round'. Detriment need not be financial. Assurances irrevocable once relied upon.

Jennings v Rice [2002] EWCA Civ 159

PE remedy must be proportionate to detriment. Robert Walker LJ: court should not award expectation if it would be 'out of all proportion' to the detriment suffered.

Davies v Davies [2016] EWCA Civ 463

Modern PE — Court must take pragmatic, holistic approach. Lewison LJ: 'Cinderella case' (daughter promised farm; left, returned). Award reduced to reflect proportionality.

Waltons Stores v Maher (1988) HCA

Australian PE — promissory estoppel can be a sword as well as a shield. Stretches estoppel beyond the orthodox English position.

Haq v Island Homes Housing Association [2011] EWCA Civ 805

PE case — emphasises need for clear assurance and detrimental reliance.

Crown Melbourne v Cosmopolitan Hotel [2016] HCA

Australian case — High Court restrictive on estoppel where the promise is too vague.

Howe v Gossop [2021] EWHC 637

Modern PE case on assurances about land.

Bristol & West Building Society v Mothew [1998] Ch 1

Definition of fiduciary by Millett LJ: 'A fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.' Distinguishes breach of fiduciary duty from negligence.

Boardman v Phipps [1967] 2 AC 46

Strict no-conflict rule for fiduciaries. Solicitor and beneficiary made profit from acting for trust; though they acted in good faith and benefited the trust, they were liable to account for the profit because of the conflict of interest.

Rukhadze v Recovery Partners GP Ltd [2025] UKSC 10

Modern UKSC case on fiduciary profit liability — confirms strict no-profit rule and that constructive trust arises automatically over secret profits (following FHR).

Hopcraft v Close Brothers Ltd [2025] UKSC 33

Recent UKSC case touching on fiduciary obligations (motor finance commissions).

FHR European Ventures v Cedar Capital [2014] UKSC 45

Where a fiduciary takes a bribe or secret commission, they hold it on constructive trust for the principal. Resolves long-running debate (Sinclair v Versailles vs AG Hong Kong v Reid). Beneficiary gets proprietary remedy.

Keech v Sandford (1726)

Foundational fiduciary case. Trustee renewed lease for himself when landlord refused to renew it for the trust. Held: trustee held the new lease on trust for the beneficiary. Strict rule against conflicts.

Bray v Ford [1896] AC 44

Lord Herschell: a person in fiduciary position is not allowed to put himself in a position where his interest and duty conflict, however well-meaning his actions. Strict prophylactic rule.

Regal (Hastings) Ltd v Gulliver [1967] 2 AC 134

Directors made profit from share opportunity that the company itself could not pursue. Held liable to account for the profit even though the company could not have taken the opportunity. Strictness of no-profit rule.

Lister v Stubbs (1890) 45 Ch D 1

OLD law: bribes received by fiduciary gave rise only to personal liability, not constructive trust. OVERRULED by FHR.

AG Hong Kong v Reid [1994] 1 AC 324

Privy Council: bribes received by fiduciary held on constructive trust. Reversed Lister v Stubbs. Confirmed in FHR (UKSC 2014).

Sinclair v Versailles [2011] EWCA Civ 347

CA tried to revive Lister v Stubbs distinction (between bribes 'to' fiduciary and profits made 'from' fiduciary's role). Overruled by FHR.

McWilliam v Norton Finance [2015] EWCA Civ 186

Modern fiduciary case — broker had fiduciary duty when arranging loan; secret commission was a bribe.

Saunders v Vautier (1841) 4 Beav 115

Rule: beneficiaries who are sui juris and absolutely entitled may collapse the trust and demand transfer. Foundation of trust law's recognition of beneficiaries' rights as proprietary, not just contractual.

Re Bowden [1936] Ch 71

Once a trust is fully constituted, the settlor cannot recall the property. Trust binds the settlor.

Chapman v Chapman [1954] AC 429

Lord Simonds LC: 'It is the function of the court to execute a trust, to see that the trustees do their duty and to protect them if they do it.' Foundation for the requirement of certainty.

Webb v Webb [1994] 1 QB 696

ECJ: equitable interest in land is in personam against the trustee, not a right in rem. Distinguishes English/equity classification.

Westdeutsche Landesbank v Islington LBC [1996] UKHL 12

Lord Browne-Wilkinson: trusts arise on conscience. A trust requires identifiable property and a person whose conscience is affected. Important for understanding RTs and CTs.

Paul v Constance [1977] 1 WLR 527

Certainty of intention. Mr Constance repeatedly told his partner 'this money is as much yours as mine.' CA held: words and conduct sufficient to create a declaration of trust over a bank account. No magic words needed; substance over form.

Re Goldcorp Exchange Ltd [1995] 1 AC 74

Certainty of subject matter. Customers paid for gold bullion held in bulk, not segregated. Held: no trust because the specific gold was unsegregated and unidentifiable. Tangible chattels need physical segregation.

Hunter v Moss [1994] 1 WLR 452

Certainty of subject matter — 50 of 950 shares. Trust valid despite no segregation. Two rationales: (1) Rimer J — shares are intangible (no segregation needed); (2) Dillon LJ — fungibility (any 50 will do). Compare Re Goldcorp.

McPhail v Doulton [1971] AC 424

Certainty of objects for discretionary trusts. Lord Wilberforce: assimilated test with powers — 'is or is not' / 'any given postulant' test from Re Gulbenkian. Replaced complete list test (Broadway Cottages). Discretionary trustees must conduct 'wider and more systematic survey' than donees of mere powers.

Re Baden's Deed Trusts (No 2) [1973]

Application of McPhail to 'relatives' and 'dependants'. Three different judgments — Sachs LJ: conceptual certainty needed; evidential burden lies on claimant. Megaw LJ: 'substantial number' must clearly fall within. Stamp LJ: stricter — must be able to say of any given person whether in or out.

English v Keats [2018] EWHC 673

Modern application of certainty of objects.

Re Hay's Settlement Trusts [1982] 1 WLR 202

Megarry VC: trustees of mere power must consider periodically whether to exercise the power; consider range of objects; consider individual cases. Sets out duties of donee of power.

OT Computers v First National Tricity [2007] WTLR 165

Certainty of subject matter — 'sufficient sums' to make payments held sufficiently certain in context.

North v Wilkinson [2018] EWCA Civ 161

Modern certainty case.

Mills v Sports Direct [2010] EWHC 1072

Certainty of intention — commercial context.

Knight v Knight (1840) 3 Beav 148

Lord Langdale MR: laid down the THREE CERTAINTIES — (1) certainty of intention/words; (2) certainty of subject matter; (3) certainty of objects/persons. Foundation of express trust formation.

Lambe v Eames (1870-71)

Precatory words ('I give all to my widow, in full confidence…') do NOT create a trust. Beneficiary of will took absolutely. Modern approach: equity looks at substance and intention, not form.

Midland Bank v Wyatt [1995]

Certainty of intention — sham trust. Mr Wyatt set up 'trust' over family home before risky business venture. Held: sham — Wyatt's subsequent conduct showed he never intended a true trust. Trust void.

Don King Productions v Warren [2000] Ch 291

Subject matter — benefit of contracts (despite anti-assignment clauses) could be held on trust as fiduciary obligation.

Boyce v Boyce (1849) 16 Sim 476

Certainty of subject matter / share. Trust to convey one of several houses to Maria as she chose, rest to Charlotte. Maria predeceased without choosing. Trust failed for uncertainty as to Charlotte's share.

Re Golay's Will Trusts [1965] 1 WLR 969

'Reasonable income' from properties — held sufficiently certain because court could objectively determine 'reasonable'. Compare Boyce v Boyce.

Re Barlow's Will Trusts [1979] 1 WLR 278

Conditional gift to 'family and friends' — held valid because each recipient just needs to satisfy condition individually (not a class trust). Test for gifts with conditions different from trusts.

R v District Auditor ex p West Yorkshire MCC [1986] RVR 24

Administrative unworkability. Trust for 'any or all inhabitants of West Yorkshire' (~2.5m people) failed even though conceptually certain — class too wide for trustees to sensibly survey/exercise discretion.

Re Tuck's Settlement Trusts [1976] Ch 99

Certainty — trust upheld where settlor provided expert authority (Chief Rabbi) to resolve conceptual uncertainty. Lord Denning MR: 'wife of Jewish blood and faith' could be made certain by providing arbiter.

Re Allen [1953] Ch 810

Conditions on gifts — narrower test than for trusts; condition only needs one possible meaning.

Vandervell v IRC [1967] 2 AC 291

Where beneficial owner directs trustee to transfer BOTH legal and equitable title together to a third party, no separate disposition under s 53(1)(c) needed. Lord Upjohn: section is to prevent hidden oral dispositions of equity; doesn't apply where legal+equitable move together. Resulting trust of options arose because no declaration of trust over them.

T Choithram International v Pagarani [2001] 1 WLR 1

Constitution. Settlor declared 'I give all my wealth to the Foundation' — was one of several trustees. Lord Browne-Wilkinson: 'Although equity will not aid a volunteer, it will not strive officiously to defeat a gift.' Where settlor is one of trustees, the gift is constituted; unconscionable to resile.

Pennington v Waine [2002] EWCA Civ 227

Constitution — extension beyond Re Rose. Arden LJ: gift complete in equity where it would be unconscionable for donor to resile. Ada signed transfer form, gave to her agent who didn't send to company. Donee told and took up directorship in reliance.

Curtis v Pulbrook [2011] EWHC 167

Briggs J: expressed unease with Pennington — said constitution rules don't 'serve any clearly identifiable or rational policy objective'. Pennington applied cautiously.

Hudson v Hathway [2022] EWCA Civ 1648

Lewison LJ: property rights in land must comply with statutory formalities to ensure certainty. Modern emphasis on importance of formality rules.

Frenkel v LA Micro [2024] UKSC 42

LANDMARK. Lord Briggs: VPCT confirmed as route around s 53(1)(c). Oral agreement to transfer 51% beneficial interest in shares of private company specifically enforceable → VPCT arose → s 53(2) → no writing needed. Confirms VPCT extends to unique chattels/private shares, not just land. Also confirms s 53(1)(c) applies to ALL property, not just land.

National Iranian Oil Co v Crescent Gas [2025] EWCA

Narrows Rochefoucauld principle. Falk LJ and Zacaroli LJ: Rochefoucauld applies only to THREE-PARTY transfer cases (A→B for C), NOT self-declaration cases. In self-declaration there is no fraud in denying the trust because the transferor would have received the property anyway.

Rochefoucauld v Boustead [1897] 1 Ch 196

Equity will not allow a statute to be used as an instrument of fraud. Comtesse's land bought by B on oral agreement to hold for her; B tried to plead Statute of Frauds. CA: oral evidence admissible despite s 53(1)(b) requirement of writing for trusts of land. Disputed: express trust enforced or constructive trust imposed?

Grey v IRC [1960] AC 1

S 53(1)(c) — meaning of 'disposition'. Hunter held shares on bare trust for himself, then orally directed trustees to hold for grandchildren. Viscount Simonds: a direction by the beneficial owner that causes the equitable interest to vest in others IS a disposition. Oral direction void → written confirmation = operative instrument → stamp duty payable.

Re Vandervell's Trusts (No 2) [1974] Ch 269

When option exercised by trustees using children's settlement money to buy shares, the resulting trust came to an end — Vandervell's interest extinguished. Megarry J's dispositive analysis. Important on operation of resulting trusts and s 53(1)(c).

Oughtred v IRC [1960] AC 206

Mother and son orally agreed to swap interests in shares (life interest + remainder); written instruments later executed. Argument: VPCT arose orally, written docs only transferred bare legal title. Majority held: written instruments still 'conveyance on sale' for stamp duty regardless. BUT case is read as implicitly accepting VPCT route around s 53(1)(c). Lord Radcliffe (dissenting) went furthest.

Re Rose [1952] Ch 499

Constitution — anticipatory CT. Settlor has done everything in his power to transfer — he holds property on constructive trust for transferee pending completion. Donor cannot recall.

Taylor v Taylor [2017] 4 WLR 83

Modern formalities case.

Ong v Ping [2017] EWCA Civ 2069

Formalities — application of s 53(1)(b) to trusts of land.

Grainge v Wilberforce (1889) 5 TLR 436

Sub-trusts. 'Where A is trustee for B, who is trustee for C, A holds in trust for C and must convey as C directs.' If B's sub-trust is bare (no active duties), B drops out and the sub-trust is effectively a disposition of B's equitable interest under s 53(1)(c). If B retains active duties, it's a fresh declaration.

Akers v Samba [2017] AC 424

Lord Neuberger: when a legal owner transfers to a bona fide purchaser without notice, the equitable interest is EXTINGUISHED, not transferred. Therefore not a 'disposition' under s 53(1)(c). Important conceptual case.

Khan v Mahmood [2021] EWHC 597

Modern formalities case.

LB Merton Council v Nuffield Health [2023] UKSC 18

Charity. Lord Briggs and Sales: charity is a legal term of art; public benefit test does not always accord with public's understanding. Confirms structured Charities Act 2011 analysis: s1 (exclusively charitable?) → s2 (charitable purpose?) → s3 (which purpose?) → s4 (public benefit?).

Re Endacott [1960] Ch 232

Beneficiary principle — non-charitable purpose trust for 'some useful memorial to myself' VOID. Outside the narrow exceptions (anomalous category). Confirms general rule that purpose trusts are void.

Re Shaw [1957] 1 WLR 729

Bernard Shaw's gift to research a 40-letter alphabet. Held: not charitable (not advancement of education, no public benefit) and void as a non-charitable purpose trust.

Re Hooper [1932] 1 Ch 38

One of the anomalous valid non-charitable purpose trusts: maintenance of graves and monuments. Limited to 'so long as the law permits' (perpetuity).

Re Denley's Trust Deed [1969] 1 Ch 373

Goff J: beneficiary principle is confined to 'abstract or impersonal' purposes. Trust for sports ground for use of company employees VALID — though phrased as purpose, was directly/indirectly for benefit of identifiable individuals (employees) who could enforce it.

ISC v Charity Commission [2011] UKUT 421

Public benefit for fee-charging schools. Schools must show meaningful provision for those who cannot pay — but no quota required. Significant for charitable status of private schools.

Re Osoba [1978] EWCA

Trust for testator's wife and daughter for 'maintenance and education' — purpose described but really a gift to identified individuals; surplus belonged to them.

Morice v Bishop of Durham (1804/1805)

Foundation of beneficiary principle. Sir William Grant MR: 'There must be somebody in whose favour the court can decree performance.' Bequest 'for objects of benevolence and liberality' VOID — too vague AND no human beneficiary to enforce.

Pitt v Holt; Futter v Futter [2013] UKSC 26

Trustees' powers — rule in Re Hastings-Bass narrowed. Lord Walker: trustee mistake/inadequate deliberation only invalidates exercise of power if amounts to breach of duty. Setting aside on grounds of mistake requires serious mistake (Pitt). Restricts the doctrine.

Schmidt v Rosewood Trust [2003] UKPC 26

Beneficiaries' rights to information. Lord Walker: no absolute right to disclosure; matter of court's discretion based on supervisory jurisdiction. Beneficiaries must show legitimate interest in disclosure. Replaces older Londonderry approach.

Armitage v Nurse [1998] Ch 241

Trustee exemption clauses — valid for everything except actual fraud. Millett LJ: 'irreducible core' of trust = duty to act honestly and in good faith for beneficiaries; rest can be excluded.

Cowan v Scargill [1985] Ch 270

Trustee investment duty. Megarry VC: trustees' duty is to act in best interests of beneficiaries — usually meaning best financial interests. Pension fund trustees could not refuse to invest in mining/foreign sectors for political/moral reasons.

R (Palestine Solidarity) v SoS [2020] UKSC 16

Local government pension scheme — trustees' investment duty. SC: SoS could not direct trustees to ignore non-financial factors that would otherwise be relevant.

Grand View Trust v Wong [2022] UKPC

Power of amendment — proper purpose limit. Trustees' powers must be exercised for proper purposes; amendment to add objects beyond original class invalid.

Re Londonderry's Settlement [1965] Ch 918

Trustees' confidentiality re reasons for discretionary decisions. Beneficiaries not entitled to disclosure of reasons. Modified by Schmidt v Rosewood.

Breakspear v Ackland [2008] EWHC 220

Briggs J: letters of wishes generally remain confidential. Trustees can disclose if appropriate.

Nestle v National Westminster Bank [1993] 1 WLR 1260

Trustee investment duty — duty to balance interests. Bank's poor investment performance not a breach where it acted within its powers; difficult to prove loss without comparison portfolio.

Harries v Church Commissioners [1992] 1 WLR 1241

Charity investment — Sir Donald Nicholls VC: charity trustees can take ethical considerations into account if investments would conflict with charity's aims, but financial duty is paramount.

Re Brogden (1888) 38 Ch D 546

Trustees must take active steps to recover trust property. Failure to call in debt = breach.

Speight v Gaunt (1883) LR 9 App Cas 1

Trustees may employ agents in the ordinary course of business. Standard of care: reasonable prudent businessman managing their own affairs.

Bahin v Hughes (1886) 31 Ch D 390

Co-trustees liable jointly and severally; no contribution between trustees of equal blame (modified now by Civil Liability (Contribution) Act 1978).

Blackwell v Blackwell [1929] AC 318

Secret trusts. Half-secret trust upheld for unnamed beneficiaries on basis of acceptance of obligation by trustee + fraud theory. Old leading case.

Generator Developments v Lidl [2018] EWCA

Pallant v Morgan-type CT. JV negotiations broke down before agreement finalised. CA: no PE/CT — agreement was 'subject to contract', no certainty. Reinforces parties' choice to remain at contractual stage.

Angove's Pty v Bailey [2016] UKSC 47

Constructive trusts in commercial context — agency. Lord Sumption: power to terminate agency does not arise constructively.

Lorenz v Caruana [2025] EWCA Civ 606

Recent CT case.

Rawstron v Freud [2014] EWHC

Lucian Freud will — half-secret trust point. Implications for executor's role.

Banner Homes v Luff Developments [2000]

Pallant v Morgan CT. Joint venture for purchase of land; one party purchased alone. CT imposed on party who acquired property despite the JV understanding.

Re Polly Peck (No 5) [1998]

Mummery LJ: rejected remedial constructive trust in English law. CTs in England arise institutionally on facts, not as discretionary remedy.

Re Snowden [1979] Ch 528

Secret trusts — half-secret trusts and standard of proof. Megarry VC.

Hussey v Palmer [1972] 1 WLR 1286

Lord Denning MR: 'constructive trust of a new model' — broad equitable approach. Mostly disapproved; English law prefers institutional CTs.

Hodgson v Marks [1971] Ch 892

Resulting trust of land — H transferred land to E orally, on understanding she remained beneficial owner; E sold to M. CA: oral evidence of trust admissible because of s 53(2) — RT is exempt from s 53(1)(b). H's beneficial interest survived under RT and bound M (overriding interest).

Re Gillingham Bus Disaster Fund [1958] Ch 300

Presumed RT. Surplus from public collection for disaster victims held on RT for donors (some unidentifiable → Crown as bona vacantia). Modern approach criticises this — see Air Jamaica.

Westdeutsche Landesbank v Islington LBC [1996] AC 669

Lord Browne-Wilkinson on RTs. RT arises where (a) gratuitous transfer (presumption of RT) or (b) failure of express trust. NOT a remedy for unjust enrichment. CT requires conscience to be affected at time of receipt.