SQE1 Equity & Trusts 2

Question 1

Which type of resulting trust arises where a person contributes to the purchase price of property but legal title is conveyed into another's name?

Accepted Answer

Presumed resulting trust

Answer

Automatic resulting trust

Answer

Institutional resulting trust

Answer

Constructive resulting trust

Question 2

In Stack v Dowden [2007], the House of Lords held that where unmarried cohabitants hold the legal title to a family home jointly, the starting presumption is that:

Accepted Answer

Beneficial interests are presumed equal but this can be rebutted by the whole course of dealing between the parties

Answer

Beneficial interests must always be equal regardless of contributions

Answer

The beneficial interest follows financial contributions only

Answer

Legal and beneficial interests always mirror each other

Question 3

How does English law characterise the constructive trust, in contrast to jurisdictions such as Canada?

Accepted Answer

As an institutional trust arising automatically by operation of law

Answer

As a remedial trust awarded at the court's discretion to reverse unjust enrichment

Answer

As a statutory trust governed by the Trusts of Land and Appointment of Trustees Act 1996

Answer

As a resulting trust based on implied intention

Question 4

In Lloyds Bank plc v Rosset [1991], Lord Bridge identified two bases on which a common intention constructive trust can arise. Which answer correctly states both?

Accepted Answer

Express common intention plus detrimental reliance, or direct financial contributions to the purchase price implying common intention

Answer

Express declaration of trust, or conduct after acquisition of the property

Answer

Financial contributions at any stage, or unilateral declarations by one party

Answer

Written agreement, or registered interest at the Land Registry

Question 5

A Quistclose trust (Barclays Bank Ltd v Quistclose Investments Ltd [1970]) arises in which of the following circumstances?

Accepted Answer

Money is lent for a specific purpose and that purpose fails, leaving it on resulting trust for the lender

Answer

A company becomes insolvent with insufficient assets to pay creditors

Answer

A bank retains money in a suspense account pending verification

Answer

A trustee misappropriates trust funds and mixes them with personal assets

Question 6

Which three elements must be established to found a claim in proprietary estoppel, as confirmed in Thorner v Major [2009]?

Accepted Answer

Assurance, reliance, and detriment

Answer

Writing, reliance, and registration

Answer

Offer, acceptance, and consideration

Answer

Intention, certainty, and capacity

Question 7

How does a half-secret trust differ from a fully secret trust?

Accepted Answer

In a half-secret trust, the will discloses the existence of the trust but not its terms; in a fully secret trust, the will appears to make an outright gift with no mention of a trust

Answer

In a half-secret trust, only half the property passes under the trust terms

Answer

In a fully secret trust, the trustee is unaware of their role until after probate

Answer

In a half-secret trust, the trust terms are disclosed to the court but not the public