Law of Wills, 2016A

On final submission after evidence taken the court dismissed plaintiff’s petition, to reverse which
she prosecutes this appeal. In view of the express admissions of counsel supra, we will dismiss
without comment the original claim of plaintiff that she obtained title to the bond in question
through an inter vivos gift from her father, and will treat the case from now on as one based upon
the claim of a valid and enforceable declaration of trust.
One of the chief elements essential to the creation of such a trust is the manifestation of an intent
on the part of the alleged donor or trustee to create it in favor of the alleged beneficiary in and to
the particular property involved. In the Restatement of the Law of Trusts, Volume I, page 73,
section 23, it is said: “In order to create a trust the settlor must properly manifest an intention to
create such a relationship as constitutes a trust as defined in section (2). *** On the other hand, no
trust is created unless the settlor manifests an intention to impose enforceable duties (see section
25). So also, a manifestation if intention to create a trust inter vivos at some time subsequent to the
time of the manifestation does not create a trust (see section 26). So also, a manifestation by the
owner of property of an intention to transfer the property to another person as an outright gift to
him is not a manifestation of an intention to create a trust (see section 31).”
Later on in the same volume, on page 100, section 31, in discussing the effect of the failure of an
intention to make an inter vivos gift, the text says: “If the owner manifests an intention to give the
beneficial interest in the property to another by employing one of these three methods, and the
disposition is ineffective because of his failure to comply with the requirements for an effective
disposition by that method, the disposition will not be upheld merely because it would have been
effective if he had manifested an intention to employ one of the other methods. An ineffective gift,
therefore, will not be upheld as a declaration of trust.”
In 96 A.L.R. page 383, there is an annotation upon the subject of “May unconsummated intention
to make a gift of personal property be made effective as a voluntary trust?” It begins with this
statement by the learned annotator: “It has been said that the only important difference between a
gift and a voluntary trust is that in the case of a gift the thing itself passes to the donee, while in the
case of a trust the actual, beneficial, or equitable title passes to the cestui que trust, while the legal
title is transferred to a third person, or is retained by the person creating it, to hold for the purpose
of the trust. Possession and control in such a case remain with the trustee, but a gift of the equitable
or beneficial title must be as complete and effectual in the case of a trust as is the gift of the thing itself
in a gift inter vivos. There must be an executed gift of the equitable title, without any reference to its taking
effect at some future time. Norway Savings Bank v. Merriam (1895) 88 Me. 146, 33 A. 840. ‘A trust is
created only if the settlor manifests an intention to create a trust’. Section 23, Tentative Draft of
Restatement of the Law of Trusts. The rule is well established that equity will not give effect to an
imperfect gift by enforcing it as a trust, merely because of the imperfection, since to do so would be to give
effect to an intention never contemplated by the maker.” (Our italics.)
In discussing the element of intent in the creation of the character of trust here sought to be enforced
the writer of the notes to the case of Marshall’s Adm’r v. Marshall, 156 Ky. 20, 160 S.W. 775, 51
L.R.A., N.S.-annotation on page 1212-says (quoting from the case of Northrip v. Burge, 255 Mo. 641,
164 S.W. 584): “The question in this case is not whether the preponderance of the competent
evidence shows that the alleged trust was executed, but is whether that fact is established by
evidence so clear, certain, complete, and convincing as to remove all reasonable doubt in our minds
on the subject, for this is the rule when parol or verbal trusts are subjects of investigation.”
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