RESULTING TRUSTS 2012.doc - J.K ASIEMA GPR 310 LAW OF...

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J.K. ASIEMA GPR 310 LAW OF TRUSTS 2012 RESULTING, IMPLIED OR PRESUMPTIVE TRUSTS An implied trust is a trust founded upon the unexpressed but presumed intention of the settler. Such a trust is also “resulting” because the beneficial interest in the property comes back (or “results”) to the person who provided the property, or to his estate. Resulting trusts arise in the following situations: 1. Where there is a purchase in the name of another 2. Where there is a voluntary conveyance into the name of another or into the joint names of the grantor and another 3. Where there is a failure to exhaust the beneficial interest 1. Purchase in the name of another Whenever a person purchases real or personal property and has it conveyed or registered or otherwise put in the name of another person, or of himself and another jointly, there is a presumption that the other holds the property in trust for the person who has paid the purchase money. There will be a resulting trust in his favour. According to Eyre CB in Dyer v. Dyer (1788) 2 Cox 92 at 93: “The trust of a legal estate… whether taken in the name of the purchaser and others jointly, or in the name of others without that of the purchaser, whether in one name or several…results to the man who advances the purchase money.” This presumption therefore arises where: (i) purchase is made in the name of the third party alone; or (ii) a purchase is made in the joint names of the purchaser and a third party; or (iii) property purchased with the contributions of more than one person is conveyed into the name of only one of them; or (iv) where contributors in unequal shares become joint legal owners. See: Fowkes v. Pascoe (1875) L.R. 10 Ch. App. 343; Pettit v. Pettit [1970] A.C. 777; Hoare v. Hoare (1983) 13 Fam. Law 142 There is no need for the conveyance or other instrument of transfer to contain any reference to the fact that the purchase price has been paid by someone other than the transferee. Parole evidence is admissible to establish who in fact advanced the money. The fact of the advance must be satisfactorily proved by evidence, including circumstantial evidence. J.E. Penner, The Law of Trusts , refers to this type of trust as a purchase money Presumed Intention Resulting Trust. 1
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J.K. ASIEMA GPR 310 LAW OF TRUSTS 2012 2. Voluntary Conveyance into the name of another or into the joint names of the grantor and another J.E. Penner, The Law of Trusts, refers to this type of trust as a gratuitous transfer Presumed Intention Resulting Trust. If A simply transfers property he already owns to B gratuitously, that is, without receiving any payment in return-for no consideration- B will hold the property on trust for A. When a person transfers legal title gratuitously to another person, equity presumes that he intends to create a trust in his favour, hence the term presumed intention resulting trust. Because the law presumes that a gratuitous transfer implies an intention to create a trust, this kind of trust is also called an implied trust.
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