evidence of an intention to make a gift that presumption remains unrebutted The

Evidence of an intention to make a gift that

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evidence of an intention to make a gift, that presumption remains unrebutted. The same, he argues, can also be said for mistaken gifts, payments under duress and most failures of consideration. Indeed, it is only with some admitted artificiality that he manages to exclude from his analysis failures of consideration which result from the defendant’s breach of contract. These apart, Birks claims that virtually all cases of common law restitution which involve a direct transfer of wealth from plaintiff to defendant will also give rise to claims in equity under a resulting trust. c.) Swadling’s Views: Swadling (1996) has opposed the Birks/Chambers thesis, arguing that the resulting trust is displaced by evidence of any intention contrary to the intention to create a trust – the transferee does not have to prove that the transferor intended to make him a gift. d.) Lord Browne-Wilkinson’s Theory: In the recent case of “Westdeutsche Landesbank v. Islington” , Lord Browne-Wilkinson doubted Megarry J’s classification of ARTs. In that case, a bank paid £2.5m to a local authority under an ultra vires swaps contract. The invalidity of the contract meant that the courts treated the payment as gratuitous. The House of Lords held that any presumption of trust in favour of the bank was rebutted by proof that the money was paid under a supposed obligation to make the local authority outright owner. This showed that the bank intended, albeit mistakenly, to make the local authority owner of the money, rather than trustee. According to him, Megarry J’s theory that ARTs does not depend on intention but operates automatically is not right. He said that both types
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Resulting Trusts 5 of resulting trust are traditionally regarded as examples of trusts giving effect to the common intention of the parties. A resulting trust is not imposed by law against the intentions of the trustee (as is a constructive trust) but gives effect to his presumed intention: “ If the settlor has expressly, or by necessary implication, abandoned any beneficial interest in the trust property, there is in my view no resulting trust; the undisposed-of equitable interest vests in the Crown as bona vacantia ”. In other words, Lord Browne-Wilkinson may be saying that there may be cases where: (1) the facts show that the settlor actually intended to abandon any interest in the trust property if the trust failed, and (2) he did not “ express ” this intention “ as a term ” of the trust he created, and (3) because of these “ collateral ” intentions the court treats the undisposed of trust property as bona vacantia. This does not upset Megarry J’s characterisation, but only modifies it in a very minor way as follows: the ART is not wholly “ intention-independent ” in that it may be displaced by a settlor’s actual intentions to abandon all interest in the trust property which might otherwise result to him to the Crown. This surely occurs in a vanishingly small fraction of trusts, and it is not clear that there have ever been any cases of this kind.
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  • Fall '12
  • WaliulIslam
  • Wills and trusts, Trust law, Settlor, Lord Millett

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