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Estate Law

Trusts

Trustees of Discretionary Trusts

Express Trust Formalities

Reform Presumed Resulting Trusts

Resulting Trusts

Discretionary Trusts Beneficiary Rights

Introduction to Secret Trusts

Secret Trusts

Enforcing a Trust

Certainty of Intention

Certainty of Objects

Certainty of Subject Matter

Special Duties of Trustees

Trusts

After Death

Challenging a Will

Making a Dependency Claim

Contesting a Will

Types of Grant and Who Can Apply

Inheritance Provision for Family and Dependants

Provision for Family and Dependants

Trustees Appointing Replacement

Perpetuities and Accumulations Rules

What Happens to Your Body When You Die

Introduction

Making a Will

Probate

When to Write a Will

Formalities of Making a Will - S.9 Wills Act

Executors

Rules of Intestacy

Inheritance Tax

Inheritance Tax on Gifts

Power of Attorney

Mental Capacity and Power of Attorney

Documents

A Living Will

Deed of Variation

Mutual Wills

Codicils and Revoking Wills

Dying Intestate

Revocation of a Will

 

Where to find the formalities? 

Where a property owner seeks to declare a trust to come into action on his death, the trust must comply with the formalities outlined in s.9, Wills Act, 1837, stating that it must be: Declared in writing.  The document must be signed by the testator (creator of the will) and that it must be witnessed by at least two persons.

Where a person intends to create a trust that is enforceable during his lifetime (inter vivos trust) or wishes to dispose of an equitable interest, the formal requirements are set out on s.53 Law of Property Act, 1925 explaining the trusts needs to (a) be evidenced in writing (for a declaration) or made in writing (for a disposition); and (b) be duly signed.

Every form of trust will have different formalities and procedures to follow in order to be valid trust.

Declarations of Trusts

There are two forms of property that may be declared under a trust, Trusts of personality and trusts of land.

Trusts of Personality

Where the subject matter of a the trust is Personality (physical objects that is not land i.e. pictures), there are no formalities required. The trust to be created in writing is desirable but not essential.

Trusts of Land

The formalities required in relation to a trust of land can be found under s53(1)(b) of the Law of property Act 1925 stating:

‘A declaration of trust respecting any land or any interest therein must be manifested and proved by some writing signed by some person who is able to declare such a trust’.

The following three points should be noted in relation to s.53 (1) (b):

  1. The declaration need not be in writing, s.53 (1) (b) “requires only evidentiary writing”, this includes a prior orally declaration later acknowledged in writing.
  2. The document declaring or affirming the trust must contain all the relevant items of property.
  3. The relevant documents must be signed ‘by some person who is able to declare the trust’.
‘Giving away’ an equitable interest to another person

An owner of an equitable interest in property may give away the benefits of that interest on another person by: (a) assigning it to the other person; (b) assigning it to a trustee on trust for the other person; or; (c) declaring himself a trustee of the interest for that other person..

Note: Under s.53 (1) (c) the agreement to transfer the interest must be in writing otherwise it will be void. The agreement need not be signed by the owner of the equitable interest himself but may be signed on his behalf by his solicitor.

How does the beneficiary give the equitable interest to another person?

Under s.9 of the Statute of Frauds a “grant or assignment” of an existing equitable interest was required to be made in writing. If the Beneficiary sets out to give away his equitable interest to a third party, he must do so in writing otherwise the assignment (giving away of property) will be void.

The ways in which the beneficiary can transfer his equitable interest from a trust to another person

Where a beneficiary directs his trustee to hold his equitable interest on trust for a third party this is considered to be an agreement (disposition or assignment)  under s 53(1)(c) and will be void if not declared in writing.

Another possibility is that the Beneficiary, instead of directing the Trustee to hold his equitable interest on trust for the third party,  may direct the trustee to transfer the legal title to the trust property into the name of the third person, with the intention that his equitable interest are to pass to X as well. In this case there won’t be the need for the trustee after the transferral and the third person will have the legal ownership rather than mere rights over the property.

If a beneficiary, owns an equitable interest in property held on trust by the Trustee, then the beneficiary can give his consent to the trustee for him to declare a the property on trust for a third party instead of keeping the trust property in the name of the original beneficiary. This must be made in writing by virtue of s.53 (1) (c).

Where the Trustee holds the property on trust for the Beneficiary it is up to the Beneficiary to declare himself a trustee of his equitable interest (property given to him through the original trust) for the benefit of a third party.

In this case the benefits and liabilities connected to the property that was left to the original beneficiary will be transferred to the third party under what is called a sub-trust. The beneficiaries therefore take on the role of the trustee holding the property on trust for the third party.

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