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association has dissolved, the property will be held on resulting trust for thepeople who originally transferred the property to the trustSee notes on UAs!!5
LAWS2016 Equity and trusts lawResulting trusts and Quistclose trustsThe appropriate characterisation of resulting trusts?oMegarry J in Re Vandervell (No 2)“[Automatic resulting trust] does not depend on any intentions or presumptionsbut is the automatic consequence of A’s failure to dispose of what is vested in him”oNB – Lord Browne-Wilkinson in Westdeutsche Landesbank v Islington“Megarry J in Re Vandervell’s Trusts (No. 2)suggests that a resulting trust of type(B) does not depend on intention but operates automatically. I am not convincedthat this is right. If the settlor has expressly, or by necessary implication,abandoned any beneficial interest in the trust property, there is in my view noresulting trust: the undisposed-of equitable interest vests in the Crown as bonavacantia”“Both types of resulting trust are traditionally regarded as examples of trustsgiving effect to the common intention of the parties. A resulting trust is notimposed by law against the intentions of the trustee (as in constructive trust) butgives effect to his presumped intention”oIs resulting trust one of common intention as in CICT?VirgoIf intention is relevant to explain when a resulting trust is recognized, itcannot be the intention of the trustee that applies; the only relevant intentionshould be that of the transferor (i.e. the settlor)Not clear what the transferor is being presumped to have intendedoPositive intention to declare a trust?oNegative intention not to benefit the recipient?Incompatible with decision in Re Vinogradoff? – cannot possibly explain thenotion of “intention” on the parts of minor?5.QuistclosetrustsGeneral principlesoWhere property has been transferred for a specific purpose (e.g. $ lent to be used toparticular way), the recipient of that property must use it for that purpose and may holdit on trust for the transferor if the purpose failsoCommercial significance – recognition of trust gives priority over the borrower’screditors if the borrower becomes insolventOperation of the Quistclose trustoBarclays Bank v QuistcloseFactsQuistclose had lent money to Rolls Razor Ltd specifically to enable it to pay adividend that it had previously declared but which it could not afford to pay$ borrowed was paid into a bank account that was specially opened for thepurposeRolls Razor Ltd went into liquidation so the dividend could not be paid6
LAWS2016 Equity and trusts lawResulting trusts and Quistclose trustsBarclays wished to use $ in account to discharge Rolls Razor’s overdraftHeld – HL – $ was on trust for QuistcloseThe loan had created a primary trust in favour of the creditors who wereowed dividends, which an equitable right for Quistclose to ensure that the