This is an extract of our Resulting Trusts document, which we sell as part of our Irish Trusts Notes collection written by the top tier of University College Cork students.
The following is a more accessble plain text extract of the PDF sample above, taken from our Irish Trusts Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
RESULTING TRUSTS: TOPIC 3.
Resulting trusts are trusts implied by the law on the basis of the intention of the settlor to make the recipient of the property a trustee. The necessary intention is presumed through the operation of a presumption.
"The doctrine of resulting trusts is a remarkably antiquated one." Mee The Past
Present and Future of Resulting Trusts at 223.
These resulting trusts 'jump back' to the settlor, so that they are in favour of the settlor himself.
Still not very clear what form of trust this is and as result it needs to be looked at in conjunction with other forms of trusts as well as its historical justification in the world of equity law.
As Hanbury and Martin note, resulting trusts are not subject to the rules which are subject to express trusts and on foot of the Re Gillingham Bus Disaster Fund case that in the case of resulting trusts, the certainty of objects requirment was abolished, due to the fact the objects do not need to be recognised in the first instance.
The rationale of resulting trusts then falls on the fact because the intentions of the testator are ambiguous and lacking clarity, "equity binds the conscience of the trustee" - (Philip Burke City Colleges), laying it upon him to hold the property for the testator.
Megarrry J in Re Vandervell's Trust, identified a two-fold classification of resulting trusts;
1. Automatic or Gap-filling Resulting trusts.
2. Presumed Resulting Trusts. RESULTING TRUSTS: TOPIC 3.
1. AUTOMATIC OR GAP-FILLING RESULTING TRUSTS:
These trusts arise in the context of the creation of an express trust.
these arise when a person is transferring property to trustees, creating a trust and they saved to allocate fully the beneficial interest.
These arise where the property is transferred without consideration lacking the existence of circumstances giving rise to the presumption of advancement and with those a declaration of an express trust.
Re Cochrane: Trust wasn't drafted well and didn't indicate who was to get the beneficial interest.
o Court held that there was a resulting trust for the husband and wife to so to speak fill the gap as to whom the beneficial interest belonged too.
In addition, concerning the lack of certainty of objects in these resulting trusts,
this is further illustrated in the case of Re Vandervell's Trust;
o This case Illustrates that an individual set lore most not like the resulting trust.
o Here Vandervell wanted to make a donation to the RCS, to avoid tax he carried out a transaction by instructing his Trust Company to transfer some valuable shares. the dividend was declared, and RCS took the benefit.
o to ensure he would get the shares back he included the option from the
Trust Company to buy back the shares for a small sum of money.
o Vandervall had failed to specify the basis on which to Trust Company was to hold the option to purchase and thus it was held that there was a gap in the beneficial interest and so the trustee company held the option to purchase on the resulting trust for Vandervall which meant that he was liable to pay tax on the dividends.
o In summary, the beneficial interest option resulted back the Vandervall.
o Hol, "interest cannot remain in the air; the consequence in law must be that it remains in the settlor".
Re Gillingham Bus Disaster Fund; case concerns a surplus of funds voluntarily subscribed after a public collection for some worthy cause, did not qualify as a charity.
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