Soton Equity and Trusts - alastairhudson.com

10) Mechanisms for eluding the “any given postulant test” (4): let the trustees do
whatever they want
Reading: Hudson, section 3.5.9
(a) Trustees’ opinion decisive
Re Coxen [1948] Ch 747 (trustees’ opinion may not by itself replace certainty)
Re Jones [1953] Ch 125 (ditto)
(b) Wide powers
Re Manisty’s Settlement [1974] Ch. 17 (granting wide powers – e.g. “trustees may give to
anyone in the world except x” – may be certain if clear who excluded).
Blausten v IRC [1972] Ch 256 (if class so wide that it is not really a class at all – e.g. everyone
in the world – then uncertain)
11) When the trust fails, resulting trust for settlor
The result of a trust failing is that the property is held on resulting trust for the
settlor. Where part of the gift fails, the whole gift must fail, to give effect to the
settlor’s intention: (Re Gulbenkian [1970] A.C. 508)
Vandervell v IRC [1967] 2 AC 291
Cf Re Leek [1969] 1 Ch 563
12) Considering the various forms of uncertainty
Reading: Hudson, para 3.5.10 on these categories.
“There must be sufficient certainty for the trustees to execute the trust according to
the settlor’s intentions”
a. Conceptual uncertainty
Where the words are unclear. If impossible to be certain: the trust fails. Test: “is or
is not”.
b. Evidential uncertainty
Where it is impossible to prove whether or not potential beneficiaries succeed in
falling within the category. This will not invalidate the trust (in most circumstances):
Baden No.2
c. Ascertainability
Where it is impossible to find beneficiaries: perhaps because they have died. This
will not necessarily render the trust invalid: Re Benjamin; McPhail v. Doulton
d. Administrative workability
Where the requirements of the trust make it impossible for the trustees to perform
their fiduciary obligations. This will invalidate the trust, per Lord Wilberforce.
Learning point: your role here as a student of law is to analyse sets of facts and to decide (i)
which form of power or trust is at issue, then (ii) apply the appropriate test from the
appropriate leading case. There may , however, be alternative analyses on some of the cases
in the lower courts. You have to be able to apply each analysis in turn and identify (a) the
different results each would produce and (b) comment on the desirability of each approach.
(D) Perpetuities and accumulations
Reading: Hudson, para 4.2.7
1) The principle under the case law: trusts created before 1964
Re Thompson [1906] 2 Ch 199, 202, Joyce J:
‘The rule against perpetuities requires that every estate or interest must
vest, if at all, not later than 21 years after the determination of some life in
being at the time of the creation of such estate or interest, and not only
must the person to take be ascertained, but the amount of his interest must
be ascertainable with the prescribed period.’
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