TRUST LAW

Introduction

This paper discusses the trust law and applies the legislation to the given case in order to demonstrate the understanding of applying the given law principles in specific situation.

Discussion

Applicable Law

Here trusts post mortem have been created by the will and as a result the relevant wills legislation must be complied with: Succession Act 2006 (NSW) s 6; Wills Act 1968 (ACT) s 9; Wills Act 2000 (NT) s 8; Wills Act 1936 (SA) s 12; Succession Act 1981 (Qld) s10; Wills Act 1992 (Tas) s 10; Wills Act 1970 (WA) s 8; and Wills Act 1997 (Vic) s 7.

In essence the following elements are required to be valid.

The will be in writing, this has been satisfied due to the will being executed in front of the solicitor appointed by Michael prior to his death.

Testator signed it where 2 witnesses were present where both testators were present.

Subject to any compliance issues.

Application of Law

Under the circumstances it appears these elements have been satisfied due to the will being drafted and executed by the solicitor appointed by Michael prior to his death. This solicitor has taken instruction and acted on Michaels instructions. There does not seem to be any vitiating factor, such as illegality or public policy, which will affect the creation of valid trusts in this case. Each of the clauses of the will need to be addressed separately to determine validity and how it impacts Claire's interest in the residue of the estate. It is presumed that Michael has capacity to make a will subject to relevant legislation: Wills Act (ACT) s 8; Succession Act (Qld) s 9; Wills Act (NT) s 7; Succession Act (NSW) s 5; Wills Act (Vic) s 5; Wills Act (Tas) s 6; Wills Act (WA) s 7; Wills Act (SA) s 5.

Issue Clause (a)

Is there an express trust?

To have a validly constituted trust there must be a:

Trustee - in this case Lisa.

Trust property - in this case favourite beach house.

Beneficiary - in this case direct children of Lisa.

The three certainties must also be present: Knight v Knight; Clay v ClayThe subject matter and object are sufficiently certain however it is debatable whether there is assurance of purpose to develop a confidence. The use of words “with the belief that” are merely precatory words with a request to deal with the property in a particular manner raise the question does the property become Lisa's in absolute with a non-binding moral obligation or does Lisa acquire the property with a binding obligation to hold it on trust for her children?

Since the case of Lambe v Evans the courts have taken the approach of reading the statement as a whole and looking at the construction under the circumstances. Per Lord Davey Re Comiskey Case the use of precatory words were neutral along with Re Williams that applied unless it appears as of the whole of that the obligation is proposed there is no obligation. The will was professionally drafted by a ...