Equity and Trusts

Lecture 1: Intro and Definitions

Trust

A relationship where a trustee is compelled in Equity to hold property for the benefit of a beneficiary.

Trustee

The legal owner of property, subject to a beneficiary's equitable rights and trusteeship duties.

Beneficiary

The beneficial or equitable owner of property, mostly waiting to receive their beneficial interest, with rights to hold the trustee personally liable for breach of trust.

Key Equitable Maxims

General principles including 'Equity will not suffer a wrong to be without a remedy' and 'He who comes to equity must come with clean hands'.

Self-Declaration of Trust

Where the settlor (creator of the trust) and the trustee are the same person.

Appointment of 3rd Party Trustee

Where the settlor (creator of the trust) and the trustee are different people (e.g., instructing a lawyer to act as trustee).

Express Trust

A trust that comes into existence because someone has intentionally performed an action to create it (e.g., written, orally).

Requirements for Creation of Express Trusts

Capacity to make a trust, the three certainties (intention, subject matter, and objects), compliance with legal formalities, and constitution of the trust.

Equitable Maxim: Equity will not suffer a wrong to be without a remedy

A fundamental principle of equity, ensuring that a legal system based on justice provides a remedy for every wrong.

Equitable Maxim: He who comes to equity must come with clean hands

A principle requiring that a party seeking equitable relief must not have engaged in misconduct related to the subject matter of the lawsuit (e.g., Douglas v Hello 2001).