Summary: Ws1 - Introduction To Wills, Trusts And Different Types Of Beneficial Interest.

Read the summary and the most important questions on WS1 - Introduction to wills, trusts and different types of beneficial interest.

• 2 Introduction To Trusts

• 2.1 What is a Trust?

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• Explain what obligations the trustee has towards the beneficiaries under a trust?

  The trustee has a binding obligation to look after the property for the benefit of the beneficiary. 

• Explain how a trust separatess the control of the property in terms of who can use/enjoy the property?

  The trustee can manage and control the property subject to the trust but the beneficiary can enjoy the benefit of the property.

• 2.2.1 Legal interest and held by the trustee

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• Who holds the legal interest in a trust?

  The trustee is the holder of the legal interest.

• Do the trustees own the trust property because they are the holder of the legal title?

  Yes, the trustee becomes the owner of the trust property.

• 2.2.2 Equitable interest held by the beneficiary

• Under a personal right, what can the beneficiaries seek for any breaches by the trustees?

  Under a personal right, the beneficiaries can seek compensation which can be enforced personally against the trustees.

• Under a proprietary right, what can the beneficiaries seek for any breaches by the trustees?

  The beneficiaries can enforce their proprietary right, ie, ownership interest in the trust property.

• Can the beneficiaries' proprietary right be enforced against the trustees and the successors in title, i.e., the people who acquire the legal title from the trustee?

  The beneficiaries' proprietary right binds the original trustee and the trustee's personal representatives.

• Can the beneficiaries' proprietary interest bind a bona fide purchaser?

  A bona fide purchaser will not be bound by the beneficiaries' proprietary interest.

• Can a sole trustee hold trust for himself alone?

  A sole trustee cannot hold trust for himself as a trust involves a separation of legal and equitable interests. Therefore, the trustee is an outright owner and has no obligation to hold the property for another.

• When trust property is given as an outright gift, what kind of ownership does the recipient receive?

  An outright gift transfers complete ownership.