Certainty of Words, Certainty of Intention, Certainty of Objects

Brief 4438

Question 1

The question of who William and Victoria hold the shares for hinges upon whether Henry successfully created a valid trust in favour of Robert and Chris. In order to create a valid trust then the certainties of words/intention, subject matter and objects must be present .1

Here the certainty of words appears to be present as Henry has specified in his will that he wishes William and Victoria to hold the money on trust for such persons as he will communicate to them in writing. Similarly the certainty of subject matter is present as the Will quite clearly states that £5000 is to be held on trust for the people Henry will specify to William and Victoria, although it is not clear in what shares the property should be held and if there were more than one beneficiary then the trust could be declared invalid as the size of the beneficial interests would be unclear.

The principal problem with the gift on trust is that it appears to lack certainty of objects, that is to say the will does not name any beneficiaries who will receive the £5000. If this were the case then Oliver would receive the £5000 as he is entitled the residuary of the estate. However, this may be an example of a half secret trust, where property is granted to a trustee in a Will but the terms of that trust do not appear in the will. If this were the case then Robert and Chris would be entitled to their beneficial interest in the £5000. For a half secret trust to be valid communication and acceptance of the trust must precede or be contemporaneous with the making of the will . 2 Here this does not seem to have happened, as the letter that contained the terms of the trust was dated after the will was drafted. As such it would appear that the trust fails as it has no ascertainable objects and as the gift was to William and Victoria on trust and not absolutely, the property will result back on trust to Henry's estate, and as such Oliver will be the eventual beneficiary of the £5000. The way in which this might possibly be altered is if Robert and Chris argue that Henry communicated the terms of the trust to William and that William had accepted the terms of that trust, and as such both trustees should be bound. However, the law is unclear on this point and it seems unlikely the trust will be valid in the absence of anything expressly laying out the terms of the trust.

(b)If the letter was dated 12th of June then it would not make any difference to the operation of the trust as although Henry's has laid out the terms of the trust prior to the making of the will he still has not communicated the terms of the trust to the trustees nor has he received acceptance from them. Again the only way in which the trust may be valid is if the court decides that the terms were communicated to William prior to the will and that he accepted them.

(c) Had the will read "I leave £10,000 to William and Victoria as trustees upon trust" it is likely that the Gift would fail as again he has not communicated the terms of the trust to the Trustees.

Under no circumstances will William and Victoria be entitled to the money as in any event they hold the money as trustees and will hold it either for Robert and Chris or Henry's estate.

Question 2

Odious has attempted to create a trust in favour of Patience with Rash as trustee. However, in his will he has specified that the money should go to Rash absolutely, and therefore prima facie the will would seem to be giving an absolute gift to Rash. In this case though there may be a secret trust at work that would allow Patience to have the money. Secret trusts may occur where a Testator has placed a binding obligation upon someone in relation to the property in question, but has not documented that obligation in the will where the property appears to be given as an absolute gift. In order for a secret trust to operate the Trustee must have accepted the terms of the trust prior to the testator's death 3 . Here Odious has given an envelope containing the terms of the trust to Rash, but has also made him promise not open that envelope until after his death. As such it may be that the trust is invalid, even though Odious told Rash several weeks ago that he was to hold the property on trust, as Rash does not appear to have agreed to the terms of the trust. It may be that Rash promised to accept the terms whatever they were but more probably Rash and not Patience is entitled to the gift.

With regard to the gift given to Sly and Timid may also be an example of a fully secret trust as it is given to them for reasons of which they are already aware and not as trustees as it would have been in a half secret trust. However, there are two significant issues with the gift that may invalidate it. Firstly only one of the potential Trustees, Sly, is familiar with the terms of the trust and that the money is to be given to Useless. The question here is whether the 'gift has been made to the donees on the strength of a promise made by one of them, that the property would be held on the terms of a secret trust'4, if so all the donees should be bound 5 . In this case it would appear that the money was given to Sly and Timid on the basis of Sly's promise and as such they should be bound. The second issue is that Useless was a witness to his father Useless's will, which would mean that had Odious created the trust in his will then Useless would not be entitled to his interest as section 15 of the Wills Act 1837 prohibits a witness to a Will taking a beneficial interest. However, as this is a secret trust Useless will not lose his interest on those grounds as secret trusts are said to be 'Dehors' the will, that is to say that they operate outside the will 6 . In which case so long as the three certainties are present Useless will be entitled to the gift so long as the terms of the trust bind Sly and Timid, which appears to be the case.

Question 3

Linda may be able to leave her shed on the land if she can prove she has a claim to the land in question under the Limitation Act 1980. If Linda can show that she has been in possession of the land continuously for twelve years and that the true owner has either been disposed or discontinued their ownership for the same period then s15 of the limitation act will allow her to claim title to the land 7 . To do this she will have to show both the 'fact of possession' and the animus 'possidendi' (the intention to possess. The fact of possession requires an appropriate degree of physical control, this means more than occasional use of the land, and if at any point during the twelve-year period the paper owner re enters the land, then the fact of possession is deemed to end. The intention to possess must be an intention to possess the land to the exclusion of all others, although it does not require the intention to possess the title to the land .8
It is not relevant whether Dorothea has any future plans for the land in question 9. Here Linda clearly has the fact of possession as she has built a shed on the land, similarly she had the intention to possess, as building a structure is undoubtedly strong evidence of a desire to possess the land. Moreover, there appears to have been no interruption of her use of the land for over 20years, nor has she received permission to use the land from either Gemma, which would have rendered any rights she had over the land a mere licence 10 . As a result the paper owner's (now Dorothea but at the time adverse possession begun Gemma) rights are barred under s 75 of the limitation act, and Linda can actually apply to the Land registry to have herself registered as the proprietor of the land, in the meantime Dorothea effectively holds Linda's right to be registered as proprietor on trust. In fact it would appear that Linda has been entitled to be registered as proprietor since 1994 when the twelve-year period first expired. Dorothea might argue that Linda failed to have herself registered as the owner and as such should not be entitled to the land, however under s 70 (1) f of the Land Registration Act 1925 rights acquired or in the course of being acquired under the limitation act are overriding, and under s 20 of the LRA1925 a purchaser will be bound by overriding interests, so Dorothea will still hold the title on trust for Linda. However, Linda's interest will be subject to any prior third party rights or interests . 11

If the title to the property were unregistered, then the paper owners rights would still have been barred and extinguished as above, this time under s17 of the Limitation Act, but rather than Linda been the new proprietor of the land she will actually receive a new estate in the land. Again Linda's interest is subject to any prior rights or interests.

It is worth noting that, in relation to registered land, the Land Registration Act 2002, which comes into force in October 2003, would significantly alter Linda's position. Under the new act Linda would have to apply to be registered as the proprietor at some point after ten years of adverse possession, once she has done this the paper owner, Gemma or Dorothea depending on when the application is made, would have two years in which to object to Linda's claim. If they did so then Linda will not be registered as proprietor, nor would the rights of the paper owner be extinguished.

  1. Knight v Knight (1840) 3 Beav 148[^ Return]
  2. Blackwell v Blackwell [1929] AC 318[^ Return]
  3. Wallgrave v. Tebbs (1855) 2 K & J 313[^ Return]
  4. A. Sydenham, Nutshells: Equity and Trusts 5th Edition, Sweet & Maxwell, London 2000[^ Return]
  5. Re Stead [1901] 1 Ch 344[^ Return]
  6. Re Young (1951)[^ Return]
  7. Buckinghamshire County Council v. Moran [1989] 2 All ER 225[^ Return]
  8. Powell v. McFarlane (1979) 38 P & CR 452[^ Return]
  9. Buckinghamshire County Council v. Moran [1989] 2 All ER 225[^ Return]
  10. Edginton v. Clark [1964] 1 QB 367[^ Return]
  11. s20 LRA1925 [^ Return]

BIBLIOGARPHY

Books

  • R. Pearce and J. Steevens, The Law of Trusts and Equitable Obligations, Butterworths, London 2002
  • Sydenham, Nutshells: Equity and Trusts 5th Edition, Sweet & Maxwell, London 2000

Websites

  • http://atlantis.ncl.ac.uk/modules/law122/ADVERSE.htm
  • http://www.landregistry.gov.uk/publications/fact_sheets/fact_sheet002.pdf

Cases

  • Blackwell v Blackwell [1929] AC 318
  • Buckinghamshire County Council v. Moran [1989] 2 All ER 225
  • Edginton v. Clark [1964] 1 QB 367
  • Knight v Knight (1840) 3 Beav 148
  • Powell v. McFarlane (1979) 38 P & CR 452
  • Re Stead [1901] 1 Ch 344
  • Re Young (1951)
  • Wallgrave v. Tebbs (1855) 2 K & J 313

Legislation

  • Land Registration Act 1925
  • Land Registration Act 2002
  • Limitation Act 1980
  • Wills Act 1837

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