Equity and Trusts Law Essay Example | Topics and Well Written Essays - 1250 words

Equity and Trusts law - Essay ExampleA fixed trust will be automatically void unless to each one beneficiary could be identified. Whereas with a discretionary trust a House of Lords stopping point held that the test was variant can it be said with any induction that a particular person is or is non a member of the class of beneficiary It is thitherfore of concern that the financial advisors at Rigby, Jolly and Pinnar (RJP) argon mixing fixed and discretionary trusts into a single instrument.Beneficiaries in fixed trusts are allocated a stipulate share or interest in the instrument. This leads to a situation whereby a fixed trust cannot be administered unless the precise number and identity of the beneficiaries is known, since each beneficiary owns a specified share of the trust. It is important that at that place should be neither conceptual nor evidential uncertainty. There have been indications that the solicits will relax this requirement to or so extent provided it is po ssible on a balance of probabilities to compile a list of the beneficiaries in enjoin to control the maximum amount of shares- even if the exact identity and whereabouts of a beneficiary is unknown. Hence in Gold v Hill 19994 an oral direction to a beneficiary to look after Carol and the kids was deemed sufficiently certain to uphold the trust, despite the fact that the exhortation is open to interpretation.Discretionary trusts however, are treated quite a differently by the courts since they invariably allow the trustees discretion in selecting the beneficiaries. Provided the trustees can distribute the result there is no particular need to identify each and every possible beneficiary McPhail v Doulton 19715. The court will look at all the circumstances to determine a suitable distribution of the proceeds - be that appointing new trustees or a representative from the class of beneficiaries or even the original trustees.The decision in Re Badens Deed Trusts (No 2) 19736 required a distinction to be made between conceptual (or semantic) uncertainty and evidential difficulty. The court applied the McPhail test to the wording dependants and relatives Can it be said with certainty that any given individual is or is not a member of the class For example the expression my children may create evidential difficulty - which will not defeat the court, but all those who owe me favours is conceptually uncertain because the description in the latter is not conceptually clear. How do we define favours in that phraseThe class of dependants and relatives is conceptually certain. Once that had been established then it is a straightforward matter to determine whether as a matter of fact a particular individual is a relative or a dependant. Lets run the Head of Legal Services clauses past the McPhail testMy friendsAssiduous lawyers working I the EUall or any of the good looking girls I dated in my young1. Is the phrase conceptually certainNo - too ambiguous. No objective te st for what a friend meant to the supporterNo - the word assiduous is too vague. How would the benefactor define assiduousNo - the phrase good