A secret trust is a type of trust in which property is devised to a person in a will document. … A fully secret trust is where the existence of a trust is not mentioned at all in the terms of the will documents. The will is completely silent as to the existence of the trust or trust property.
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What is the purpose of secret trust?

A secret trust is an arrangement between a testator and a trustee to benefit a person without having to specify that person in a will. The trustee is transferred property under the terms of the will which he or she then holds on trust for others.

What is the difference between a fully secret trust and a half-secret trust?

In a fully secret trust property is given to a legatee, apparently beneficially, without words imposing a trust. … In a half-secret trust the terms of the will make it clear that the legatee is to hold property on trust, but the terms of the trusts upon which he is to hold the property are not disclosed.

What happens when a fully secret trust fails?

With fully secret trusts, a testator must communicate the terms of the trust to the intended trustee at any point up to the date of their death. … Furthermore, there is the risk that if a fully secret trust fails for another reason, the intended trustee will be able to take the gift for themselves.

How do you identify a half-secret trust?

A half-secret trust arises where a testator refers to the existence of the trust in his Will but does not define the terms of it. For example “I give [gift] to A on the trusts which I have communicated to him.

What type of trust is a secret trust?

A secret trust is a trust which arises when property is left to a person (the legatee) under a will on the understanding that they will hold the property as trustee for the benefit of beneficiaries who are not named in the will.

Are secret trusts valid?

Secret Trusts are a means by which a testator is able to bypass the formality requirements laid down in the Wills Act 1837. … Fully secret trusts have certain testamentary characteristics they are valid, despite lack of testamentary formalities, because the trustee accepts the trusts during the settlor’s lifetime.

Do the three certainties apply to secret trusts?

Like any other trust a secret trust must satisfy the three certainties: intention, subject matter, and objects.

How do you enforce a secret trust?

An alternative basis for enforcing secret trusts is the transfer and declaration theory. The approach here is that the will transfers the property to the trustee, subject to an express, conditional declaration of trust executed by the testator outside the will.

Should secret trusts be abolished?

The unjustified and unnecessary doctrine of secret trusts should be abolished. … The purported reasons in favour of enforcing secret trusts are not only unfounded, but often also result in negative consequences. Hence, it is necessary to abolish secret trusts, rather than to quietly allow them to continue.

What is resulting trust in land law?

A resulting trust is an implied trust that comes into existence by operation of law, where property is transferred to someone who pays nothing for it; and then is implied to have held the property for benefit of another person. The trust property is said to “result” or jump back to the transferor (implied settlor).

What is constructive trust in law?

Primary tabs. A constructive trust is not an actual trust by the traditional definition. It is a legal fiction that is used as a remedy for unjust enrichment. Hence, there is no trustee, but the constructive trust orders the person who would otherwise be unjustly enriched to transfer the property to the intended party.

What is a half trust?

A half secret trust arises when the will indicates or acknowledges the existence of the trust but the terms are concealed from the testators will. The trustee will then take the property on the terms of the trust that were communicated to them during the testator’s lifetime.

Does a secret trust have to be in writing?

A secret trust need not be set out in writing: Ottaway v Norman [1972] Ch 698. And where the trust alleged has been created informally, a central issue for the Court will often be whether the testator actually intended to create a trust at all.

Can you have a secret will?

If you prefer to keep certain aspects or details of your estate plan secret, using a secret or semi-secret trust may be your best option. A secret trust is one in which a Testator appears to leave assets outright to someone in a Will; however, that beneficiary is really a Trustee for another beneficiary.

Are secret trusts testamentary?

Secret trusts and half secret trusts are essentially testamentary trusts which operate outside the requirements of the Wills Act 1837. … The property is held on trust by someone who has made a promise to the testator to hold the property on trust for the eventual recipient.

What is dehors the will theory?

Dehors the will theory stands by arguing secret trust operates outside the will for it is in fact an inter vivos trust declared by communication of trust to trustee and constituted on settlor’s death.

How do you prove a resulting trust?

To prove a resulting trust, a victim must prove four elements by clear, strong, and convincing evidence. Clear, strong, and convincing evidence is a higher burden of proof than most civil cases require.

What are the two categories of resulting trusts?

These trusts come in two forms: automatic resulting trusts, and presumed resulting trusts. Automatic resulting trusts arise from a “gap” in the equitable title of property.

How does a resulting trust work?

A resulting trust is an equitable reversion that arises by operation of law whenever a person has created an express intentional trust, but the express trust fails or does not completely dispose of the trust property.

What is the difference between a resulting trust and a constructive trust?

A resulting trust is based upon the presumed intention that arises where a person provides funds for the purchase of property. A constructive trust is founded upon a common intention that can either be expressed or inferred but cannot be based upon an intention that the parties never in fact had.

When would you use a constructive trust?

A constructive trust is created to remedy (or make up for) a situation where there is “unjust enrichment.” If someone has possession of property (money, real estate, or other assets) that they should not have because they obtained it unfairly through fraud or breach of a fiduciary duty, this is unjust enrichment.

How does constructive trust arise?

A trust that arises by operation of law where it would be unconscionable for a person (A) who holds an asset to deny the beneficial interest of another person in the asset. For example, a constructive trust may arise where: A holds funds that he knows have been paid to him by mistake.

What is a private trust?

What is a private trust? A trust allows you as the ‘settlor’ to transfer your money, or other assets such as property, land and investments, to the control of an independent ‘trustee’ who is legally bound to deal with the assets according to your wishes, set out in a ‘trust deed’.