What does formalities for constitution mean?
Formal requirements for transferring legal title to another person
Do we need to consider formalities of constitution in regard to a self-declaration of trust?
No as the legal title is not given to another person
When do we need to consider the constitution rules?
When legal owner intends to make a gift or transfer on trust
What is laid out in s9 Wills Act 1837?
Requirements for creation of a testamentary trust
Where are the formalities for a declaration for a trust of land laid out?
s53(1)(b) LPA 1925
What are the formalities of s53(1)(b)?
- ‘Manifested and proved’ - declaration and the writing need not be contemporaneous
- ‘Some writing’ - something in writing proving the settlor’s intention to create a trust and the terms of the trust
- ‘Signed by some person who is able to declare such trust’ - signature is usually that of the settlor, but it could be written evidence from the trustee as the legal owner (preferable to seek legal advice from the courts on this)
What is the result if the formalities in s53(1)(b) are not complied with?
The trust is unenforceable
What sort of trusts does s53(1)(b) LPA apply to?
Creation of express trusts
What does s53(2) LPA 1925 relate to?
Resulting, constructive and statutory trusts
When does an automatic resulting trust arise?
When legal title has been transferred to an intended trustee, but the trust fails for some reason
When does a presumed resulting trust arise?
When legal title is gratuitously transferred but there is no evidence that it was intended to be a gift
When does a constructive trust arise?
In circumstances where it would be unconscionable for the legal owner of property to assert beneficial ownership of that property
How must a transfer of legal title be carried out for registered land?
- Made by deed under s52(1) LPA 1925
- Registered with the Land Registry under s27 LRA 2002
- Legal title passes on reg of new owner at the Land Registry
How must a transfer of legal title for shares be carried out?
- Transferor signing a stock transfer form and sending it to the company
- Legal title passes when transferee is registered in the company’s internal register of members
How must transfer of legal title for chose in action (debts and money in bank account) be carried out?
- Written transfer and notice in writing to the debtor or bank
- Legal title passes once notice is received
How must a transfer of legal title for chattels be carried out?
- By deed or gift
- By delivery of chattel with evidence of the transferor’s intention to transfer
How must a transfer of legal title for cheques be carried out?
- Transferor endorsing the cheque by signing their name on the back
What is the effect of constitution?
Disposition is irrevocable
What did the case Milroy v Lord establish?
Equity will not perfect an imperfect gift or treat a failed gift as a self declaration of trust
What are the exceptions to the Milroy v Lord rule?
- Principle in Re Rose
- Fortuitous vesting
- Donationes mortis causa
- The unconscionable principle
Why was it found in Re Rose that Mr Rose had done everything in his power to ensure transfer?
- Correct method of transfer had been used
- Transferor had done everything in his own power to effect the transfer of (sent docs to correct person before deadline date)
- Documentation ended up in the hands of the person capable of effecting the legal transfer
What did the case Mascall v Mascall establish?
It is not necessary for the transferor to send the documents to the person capable of completing the transfer, IF the correct method of transfer had been used and the transferor put the matter beyond their own control
What did the case Pennington v Waine conclude in relation to equity perfecting a gift?
Equity would perfect an imperfect gift where it would be unconscionable for the donor to resile from it
When will proprietary estoppel arise?
- If there is an assurance
- Reliance
- Detriment
