What are the three certainties that must be present for a trust to be valid?
- Words
- Subject matter
- Objects
These certainties originated from the case law of Knight v. Knight (1840).
What is the legal ownership of trust property held by?
Trustee
The trustee holds the assets in their name.
Define realty in the context of trust property.
Freehold interest in land
The American terms real estate or realtor derive from this.
What are the two sub-divisions of personality in trust property?
- Chattels Real
- Chattels Personal
Chattels Real refers to leasehold interests, while Chattels Personal includes non-land-based assets.
What are choses in action?
Intangible assets
Examples include investments or life assurance policies.
What are choses in possession?
Tangible objects
These are items that can be physically seen and touched, such as jewellery or cars.
What is the role of trustees in a trust?
Legal owners of the trust property
They manage the property for the benefit of the beneficiaries.
What must trustees follow according to the trust deed?
The mandate given by the trust deed
They must manage the property as if it were their own.
What does the Trustee Act 2000 incorporate for trustees?
Statutory duty of care
This duty requires trustees to act with care in managing the trust.
What is the typical number of trustees in most trusts?
Between two and five
There are restrictions for trusts holding land, requiring two to four trustees.
What must trustees consider regarding investments?
- Suitability of the investment
- Need for diversification
Trustees should review and vary investments as appropriate.
What does the Saunders v. Vautier (1841) ruling allow beneficiaries to do?
Bring a trust to an end
This can occur under specific conditions regarding the beneficiaries.
What are the conditions for beneficiaries to end a trust according to Saunders v. Vautier?
- All beneficiaries can be ascertained
- No possibility of further beneficiaries
- All beneficiaries are of full age and capacity
- Unanimous agreement of all beneficiaries
This ensures that the trust can be dissolved and property distributed.
