You are on page 1of 5

PRESUMPTION OF ADVANCEMENT

Tutorial Question 7 IZZAH ZAHIN ALIMAN NADRA FATIMA MANNAN NAWAL AQILAH BAHARUDIN AISYAH 14/3/2013

Ponniah v Sivalingam & Ors [1991] 3 MLJ 190
Held: The presumption of advancement is rebuttable by the evidence of the true intentions of the transferor as regards the beneficial interest of the impugned property

TRUST
EXPRESS TRUST IMPLIED TRUST

RESULTING TRUST
Re Vandervell`s Trust (No. 2)

CONSTRUCTIVE TRUST

PRESUMED TRUST

AUTOMATIC TRUST

PRESUMED RESULTING TRUST
PRESUMPTION OF ADVANCEMENT
Eg: EVIDENCE OF ACTUAL INTENTION

-------------------

REBUTTING

Eg:

Father - Child

- P was the natural and lawful father of the 1st -7th D and lawful husband of the 8th D. - P transferred all his rights, titles and interest in his business to 2 companies (‘SFM’ and ‘SSB’) in consideration of the 2 companies issuing 2,000 and 775,003 fully paid up shares respectively to him. Upon issuance, P allotted in the names of the 1st - 6th D, 300 shares each of SFM and 125,500 shares each of SSB. Of the remaining shares in SFM, P and 8th D were allotted 50 shares each and the 7th D allotted 100 shares. Of the remaining SSB shares, P and 1st D were allotted 5,001 shares each and the 1st D had an extra share. - None of 1st - 8th D paid any consideration for the shares which was solely contributed by P. - P alleged that it was not his intention to allot the shares as an advance or a gift but they were allotted on condition that the 1st - 7th D held the shares in absolute trust for P during his lifetime and thereafter in trust for 8th D for her lifetime and thereafter to the children’s respective benefits in proportion to their shareholding. - P was at all material times in physical possession of all the share certificates and was also the chairman and managing director of the 2 companies. - The 4th - 6th and 8th - 10th D denied that the shares were allotted to them as trustees. Further they contended that valuable consideration was given at the time of allotment. 1st D contended that P had formed the companies for the purpose of tax benefits and to retain the profits of SFM to buy more assets in SSB. He claimed that he had paid $30,000.00 for the shares. * The High Court found that all the share certificates were kept by P and he never gave those certificates to any of D. No consideration was given for the shares and P was in full control of the 2 companies. It was the intention of the plaintiff to retain the beneficial interest of the shares allotted to the defendants during his lifetime. * Therefore, the Court held that D held the shares on trust for P