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- The trust intentionally created. The certainty and formality rules must be obeyed.
- This is a long standing rule and there are 3 certainties that all trust must satisfy.
i-Certainty of Intention:
ii-Certainty of Subject:
iii-Certainty of Object:
ii-Transfer property
- No particular form of words is required but in whatever way the intention is expressed
the three certainties must be satisfied.
Fiduciary duty
- Trustees have fiduciary duties and therefore they must properly consider their choice.
1) Certainty Of Intention
- Testator/settlor must show an intention to create trust, therefore the word used must
be clear in showing the presence of intention.
- It is important to realize that the courts are basically concerned with whether the
words used by the settler or testator reveal a clear intention to create a trust. In this
4 exceptions
1) Rule in Strong v Bird
- The gist of this rule is If a person expresses a present (during lifetime) intention
to make a gift (incomplete gift because did not completed necessary formalities)
of personal estate to another, and that intention remains until the former
passed away and the latter becomes the executor of the will or administrator of
intestacy, then the latter is allowed to hold the property for his or her benefit,
because the latter capacity upon the appointment override the claims of the
beneficiaries of the will or intestacy, as well as release a debt.
- Case: Strong v Bird
o Fact:- Bird borrowed £1,100 from his stepmother. She was living with him
and paying him for rent. It was agreed by both parties that the loan was
to be repaid by a reduction in the rent, until the loan was settled. Bird’s
stepmother only paid the reduced rent twice. Thereafter, she paid the full
rent until her death.
o On her death, she appointed Bird as her executor and the next of kin
now attempted to recover the debt from Bird. The conduct of his
stepmother (stopped paying the reduced rent as per their agreement)
does not discharge the debt at law because there was no consideration
provided for the release.
o The issue was whether Bird must pay back the loan.
o Held:- The appointment of Bird as the executor was an evidence that the
loan to Bird was a gift to him. This is because the executor is responsible
for calling in debts to the testator's estate, It would be ridiculous for the
executor to sue himself for the debt. Therefore, common law rulings
o
4- The subject matter of the intended gift must have been capable of enduring
the death of the donor.
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- A trust can be created by any language which is clear enough to show an intention to
create it.
- But to what extent of the word used? Since equity looks at the substance/intent rather
than form, thus: