The University of Southampton
Courses

LAWS2016 Equity & Trusts

Module Overview

In order to understand the history behind the trust, this module introduces you to the historical foundations of equity, to the distinction between common law and equity, and to, arguably, the most important principle of equity, namely, unconscionability. It is upon this principle that the trust developed and, indeed, continues to develop. The first semester is concerned, largely, with the express trust, and the body of rules that has grown up over the centuries dealing with the making and the running of a trust which a settlor has deliberately created, whilst the second semester concentrates upon the implied trust, embracing constructive and resulting trusts. You will notice that, unsurprisingly, there is a significant overlap between those parts of the second semester and your Land Law module that deal with co-ownership, and you will gain your first flavour of the issue of taxation (the reason for the creation of many trusts). You will also be surprised by the application of rules designed for a society that no longer exists to modern day financial and commercial transactions.

Aims and Objectives

Module Aims

The aims of this module are: • to give you the opportunity to explore and understand the dynamic role of equity and, in particular, the trust, so that you can develop an understanding of the principles of the trust, the nature of the office of trustee and of the beneficial interests behind the trust • to provide you with exposure to legal principles derived from a variety of legal instruments including primary materials found in reported cases and statutes and in some secondary materials of leading academic discourse. • to enable you to develop skills of legal analysis and problem solving in Equity and Trusts Law • to encourage you to evaluate the flexibility of equity and the trust and its responsiveness to the ever changing circumstances of an evolving society.

Learning Outcomes

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

  • the formal requirements for the establishment of a valid express trust, both inter vivos and on death;
  • the enforceability of trusts which have not been properly constituted;
  • the problems with purpose trusts and their enforceability;
  • charitable trusts including the operation of the cy-pres doctrine;
  • the nature of the fiduciary relationship and the protection of the beneficial interest;
  • powers and duties of the trustees and remedies for any breach of duty;
  • the informal acquisition of an interest in property through a resulting or constructive trust;
  • the liability of third parties in respect of trust property;
  • the use of trust principles to solve complex commercial problems as well as to minimise liability to tax.
Transferable and Generic Skills

Having successfully completed this module you will be able to:

  • analyse, interpret and evaluate complex statutory material;
  • analyse, interpret and evaluate complex case material;
  • effectively apply knowledge from legal materials to solve practical problems;
  • formulate and effectively reasoned and structured argument;
  • develop and present written arguments supported by appropriate evidence.
Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

  • identify and locate primary and secondary (including electronic) legal sources relevant to equity and trust law;
  • analyse and critically assess legal materials by way of statutory interpretation, case analysis and review of secondary materials to identify, comprehend and evaluate fundamental legal principles and their impact upon contemporary issues;
  • from a given factual scenario, identify the relevant facts and legal issues raised, explain the law applicable to the identified legal issues and apply the relevant law to the given facts;
  • examine uncertainties in the law and its application to the given facts and evaluate alternative approaches and arguments;
  • provide adequate support by reference to legal authority.
  • produce effectively reasoned and structured responses to a given statement or proposition, which are adequately supported by reference to legal authority;

Syllabus

1. The module is structured and divided into the following sections which also indicate the content of each section. 2. Part 1 CORE PRINCIPLES 1. Introduction to Equity (a) The nature of Equity (b) The core principles of Equity 2. The nature of the Trust (a) Evolution of the Trust (b) The nature of the trust relationship (c) Classification of Trusts (d) How the express trust works (e) Significant features of the trust (f) The concept of fiduciary responsibility (g) The obligation of trustees and the rights of beneficiaries 3. Modern uses and benefits of the Trust Definitions 3. Part 2 THE THREE CERTAINTIES 1. Certainty of intention 2. Certainty of subject matter 3. Certainty of objects 4. Part 3 THE BENEFICIARY PRINCIPLE AND PURPOSES 1. The beneficiary principle 2. The rule against perpetuities, accumulation and perpetual duration 3. Unincorporated associations 5. Part 4 CHARITABLE TRUSTS 1. Requirements of a charitable Trust 2. Public benefit 6. Part 5 FORMAL REQUIREMENTS OF AN EXPRESS TRUST 1. The Need for Formalities 2. Transferring Property to Trustees 3. Declaration of Trust 4. Disposition of Equitable Interests 5. Testamentary Dispositions: Secret Trusts 6. Enforcement of Incompletely Constituted Trusts 7. Part 6 TRUSTEES – DUTIES AND BREACH OF TRUST 1. Definition and Content of Fiduciary Obligations 2. Nature of Fiduciary Liability and Remedies for Breach of Fiduciary Duty 3. Duties and Powers of Trustees 4. Breach of Trust 8. Part 7 TRUSTS IMPLIED BY LAW 1. The fundamentals of Trusts implied by Law 2. Resulting trusts 3. Quistclose Trusts 4. Constructive Trusts 9. Part 8 TRUSTS OF HOMES 1. Common intention constructive trust 2. Contribution to purchase price: resulting trusts 3. Proprietary estoppel 10. Part 9 TRACING 1. The process of tracing 2. Common law tracing 3. Equitable tracing 4. Remedies following tracing 5. Defences Page 4 of 7 11. Part 10 THIRD PARTY LIABILITY 1. Dishonest assistance 2. Unconscionable receipt 3. Attributing liability to corporate entities 4. The remedy open to the beneficiary

Learning and Teaching

Teaching and learning methods

Teaching methods include • Lectures to provide knowledge and information within a structured context. • Group tutorial work focused on problem solving skills and development of reasoned argument. • Advance study is required for the tutorials and active participation required by all members of the group. Learning activities include • Directed reading assisted by reading lists and availability of materials on Blackboard; • Accessing electronic resources in the form of legislation, journals and case materials; • Reviewing and evaluating complex material; • Tackling and solving factual legal problems; • Formulating and presenting in oral and written form reasoned and structured arguments through formative tutorial activities and assessment. Attendance at Lectures will develop • Knowledge of the substantive principles and rules of Equity and Trusts Law; • Understanding of constructive criticism of the law; • Ability to participate in oral discussions concerning the issue being considered Preparation for Tutorials will develop • Knowledge of the substantive principles and rules of Equity and Trusts Law; • Ability to manage and access diverse range of sources of law, especially statutory material and case law, many on-line; • Ability to critically evaluate those sources and participate constructively in oral discussions concerning them; • Ability to structure and express thoughts in logically coherent way; • Ability to apply those materials to problem solving exercises; • Time management and research skills.

TypeHours
Tutorial20
Revision40
Preparation for scheduled sessions40
Wider reading or practice160
Lecture40
Total study time300

Resources & Reading list

Jonathan Garton (2015). Moffat’s Trusts Law, Text and Materials. 

Alastair Hudson (2014). Equity and Trusts (part of Palgrave’s Great Debates in Law). 

Watt (2014). Trusts and Equity. 

Pettit (2012). Equity and the Law of Trusts. 

Graham Virgo (2012). The Principles of Equity & Trusts. 

Pearce, Stevens and Barr (2014). The Law of Trusts and Equitable Obligations. 

Hanbury & Martin (2015). Modern Equity. 

Assessment

Formative

Coursework

Summative

MethodPercentage contribution
Essay  (2500 words) 20%
Examination  (3.5 hours) 80%

Repeat

MethodPercentage contribution
Examination  (3.5 hours) 100%

Referral

MethodPercentage contribution
Examination  (3.5 hours) 100%

Repeat Information

Repeat type: Internal & External

Costs

Costs associated with this module

Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.

In addition to this, students registered for this module typically also have to pay for:

Books and Stationery equipment

Recommended texts for this module may be available in limited supply in the University Library and students may wish to purchase the core/ recommended text as appropriate.

Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at www.calendar.soton.ac.uk.

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