CILEx L3 Equity & Trusts Introduction 2

Question 1

What are the 'three certainties' required for a valid express trust?

Accepted Answer

Certainty of intention, certainty of subject matter, and certainty of objects

Answer

For a valid express trust, the three certainties are required (Knight v Knight [1840]): (1) certainty of intention — clear intention to create a trust; (2) certainty of subject matter — the trust property must be identifiable; (3) certainty of objects — the beneficiaries must be ascertainable.

Question 2

What formalities are required for the creation of an express trust of land?

Accepted Answer

The trust must be evidenced in signed writing under s.53(1)(b) Law of Property Act 1925

Answer

Under s.53(1)(b) LPA 1925, a declaration of trust respecting any land or any interest therein must be manifested and proved by some writing signed by the person able to declare the trust. Writing is required as evidence, not necessarily for creation.

Question 3

What is a 'resulting trust'?

Accepted Answer

A trust that arises by operation of law, returning the beneficial interest to the settlor where the express trust fails or the property is gratuitously transferred

Answer

A resulting trust arises by operation of law, returning the beneficial interest to the person who provided the property. This occurs where an express trust fails (automatic resulting trust) or where there is a gratuitous transfer or purchase in another's name (presumed resulting trust).

Question 4

What is a 'constructive trust'?

Accepted Answer

A trust imposed by law in circumstances where it would be unconscionable for the legal owner to deny another's beneficial interest

Answer

A constructive trust is imposed by equity as a matter of law where the legal owner of property cannot in conscience deny another's beneficial interest, such as where there has been a common intention to share beneficial ownership and the claimant has acted to their detriment.

Question 5

What is the 'rule in Strong v Bird [1874]'?

Accepted Answer

An imperfect gift is completed if the donor appoints the donee as executor and intended to make an immediate gift

Answer

The rule in Strong v Bird provides that an incomplete gift (one not properly perfected inter vivos) is completed where the donor later appoints the donee as executor and the intention to make an immediate gift continued until death.

CILEx Level 3 Practice Test

CILEx Level 3 Practice Test

CILEx L3 Equity & Trusts Introduction 2