Equity & Trusts Revision Notes

Equity exists to mitigate common law severity and ensure fairness.
Core Maxim: “Common law is strict, Equity is fair.”
Ongoing debate exists regarding whether the Three Certainties have reduced equity's inherent flexibility.

Established in the case of Knight v Knight (1840).
Intention: Clear intent to create a trust. Case examples: Paul v Constance (1977) (valid intention via “This money is as much yours as mine.”); Lambe v Eames (1871) (vague wording failed test).
Subject Matter: Property must be clearly defined. Case examples: Palmer v Simmonds (1854) (“bulk of my estate” was too vague); Hunter v Moss (1994) (identical shares deemed sufficiently certain).
Objects: Beneficiaries must be identifiable. Case example: McPhail v Doulton (1971) established the “is or is not” test.

These arise from financial contributions to property ownership, often disputed during couple separations.
Key Case: Westdeutsche Landesbank v Islington LBC (1996).
Critical Issue: Potential unfairness to non-financial contributors and the debate over statutory intervention.

Express Trusts: Intentionally created by a settlor; requires three certainties, formalities, and constitution.
Secret Trusts: Fully hidden from the will. Requires CAA: Communication, Acceptance, and Reliance. Case: Ottaway v Norman (1972).
Half-Secret Trusts: Will indicates a trust exists but conceals beneficiaries. Communication must occur BEFORE the will is executed. Case: Blackwell v Blackwell (1929).

Determines if property was properly transferred.
General Rule: Milroy v Lord (1862) establishes that equity will not perfect an imperfect gift.
Exception – Re Rose (1952): Transfer is effective if the donor did everything in their power to complete it.
Exception – Pennington v Waine (2002): Transfer may be upheld if it would be unconscionable or unfair to deny it.