Trusts Law Essay Example | Topics and Well Written Essays - 2500 words

Trusts Law - Essay Example r to fully understand the trust and its principle application it is necessary to know what a trust is, the different types of trust and the specific requirements for the creation of a trust. A trust can be either express or implied.3 The express trust entails a purposeful creation while the implied trust occurs by operation of law in cases where an unconscionable outcome would occur.4 The implied trust can be either constructive or resulting.5 The resulting trust occurs where property transferred reverts to the settlor or his/her estate. A resulting trust can also be established to fill a â€Å"gap in ownership† or dispose of â€Å"surplus of trust funds† after the disposition of the trust property.6 Quite often a resulting trust follows from a trust which is settled by virtue of a condition precedent which fails.7 A resulting trust may also be implied by law where it is necessary to interpret and give effect to the settlor’s intention.8 In such a case, the settlor of the property is presumed to be the equitable owner of the property 9. When property is purchased in the name of a third party this may obviate such a presumption. For instance, an individual purchases stock and directs the vendor to transfer the stock to a third party. It is naturally presumed that the stock is held upon trust for the purchase of the stock.10 On occasions when a trustee abuses the confidence reposed in him by realizing an unauthorised profit derived from the trust property, or becomes unjustly enriched at another’s expense, the court may impose a constructive trust on the party who acted with impropriety.11 In Broadman v Phipps [1967] 2 AC 46 the court imposed a constructive trust in a situation where an attorney in the course of representing a trust happened to come across some confidential information which he used for the purpose of acquiring company shares that were partly owned by the trustees. The company did well and made significant profits as a result of the