FE-1 Equity 3

Question 1

A constructive trust differs from an express trust in that it arises in which of the following ways?

Accepted Answer

By operation of law whenever equity regards it as unconscionable for the legal owner to deny another's beneficial interest

Answer

A constructive trust is imposed by equity as a matter of law, independently of the parties' intention, wherever the conscience of the legal owner is sufficiently affected to justify imposing trust obligations.

Question 2

The 'no conflict' rule in Irish fiduciary law prohibits a fiduciary from doing what without full disclosure and consent?

Accepted Answer

Placing themselves in a position where their personal interests or a duty to another conflicts with their duty to the beneficiary

Answer

The no conflict rule requires fiduciaries to avoid positions where their own interests or conflicting duties could influence the exercise of their duty to the beneficiary, unless they make full disclosure and obtain informed consent.

Question 3

Under the Charities Act 2009 (Ireland), which of the following is a recognised charitable purpose?

Accepted Answer

Advancement of education for the public benefit

Answer

The Charities Act 2009 lists the advancement of education as a recognised charitable purpose, provided it is for the benefit of the public or a section of the public.

Question 4

The cy-près doctrine in Irish charity law applies in which situation?

Accepted Answer

When a charitable purpose becomes impossible or impractical, allowing the court to redirect funds to a similar purpose

Answer

The cy-près doctrine saves a charitable gift from failing by redirecting the funds as near as possible to the original charitable purpose when that purpose can no longer be achieved.

Question 5

The standard for 'dishonest assistance' liability in a breach of fiduciary duty, as set out in Royal Brunei Airlines v Tan [1995], requires that the assisting third party acted in what manner?

Accepted Answer

Dishonestly by the standards of honest and reasonable people

Answer

Royal Brunei Airlines v Tan established that liability for dishonest assistance requires the defendant to have been subjectively dishonest, assessed by the objective standard of what an honest person would have done in the circumstances.

FE-1 Practice Test

FE-1 Practice Test

FE-1 Equity 3