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25 Cards in this Set
- Front
- Back
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All trustees in breach are ___________ liable
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jointly and severally
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Personal claims
Claims against T who will satisfy claim from own property. Will not be appropriate if T is..... |
bankrupt (no priority)
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Personal claims
Breach of trust - 2 requirements ... Or.... T has taken..... |
Breach
Loss to trust Trust property |
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CASE:
Personal claim failed - there was a breach but no evidence to suggest that trust would have been worth more under the management of another t'ee |
Nestle v National Westminster Bank
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DEFENCES
4 defences for breach of trust |
Court relief
Exclusion Clause Consent of Bs Limitation |
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DEFENCES
STATUTE Court can relieve trustee of liability (wholly or in part) if they acted reasonably and honestly (Note: unlikely to exclude passive trustees - policy reasons) |
s 61 TA 2002
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DEFENCES
CASE Court will be reluctant to relieve professional trustees of liability |
Bartlett
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DEFENCES
Exclusion clauses can relieve trustees of liability for __________ and ____________ breaches |
negligent
innocent |
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DEFENCES
Exclusion clauses for fraudulent breaches will be VOID. |
Armitage v Nurse
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DEFENCES
Consent of Beneficiaries B does not need to know that T is in breach. Enough that B knows ALL MATERIAL FACTS |
Re Pauling
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DEFENCES
STATUTE actions relating to breach of trust cannot be brought after 6 years when cause of action arose. (Note: period will start when relevant B acquires an interest - i.e. when interest vests) |
s 21(3) Limitation Act 1980
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DEFENCES
STATUTE No limitation period for fraudulent breaches or when T has trust property in his possession |
s 21(1) LA 1980
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STATUTE
T who is sued can claim a contribution from another guilty trustee |
CL(C)A 1978
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Trustee can seek indemnity from co-trustee who is breach if co-trustee fraudulently obtained benefit (in this case, received trust property)
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Bahin v Hughes
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CASE
When T blindly follows co-T who is a solicitor, he can claim full indemnity |
Re Partington
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CASE
Qualifies Re Partington - can use if solicitor exerted such a controlling influence that he did not exercise own judgement |
Head v Gould
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Proprietary claims - Only possible if T holds trust property in some form
Bs will have... |
priority over creditors
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CASE
No Mixing - Clean substitution. B can either elect to take property purchased or equitable lien over property to secure the amount due to the trust |
Re Hallett
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CASE
Mixed Asset - Trust funds and T'ees funds C can either claim proportionate share OR enforce a lien over asset to secure amount due to trust |
Foskett v McKeown
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CASE
Mixed bank account Basic rule - T spends own money first |
Re Hallet
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CASE
Mixed bank account If basic rule produces inequitable result, B can claim a lien over assets (which T bought first) for amount of trust money spent |
Re Oatway
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CASE
Mixed Bank Account It has been suggested that B should be entitled to proportionate share including increase in share value - NOT entirely clear |
Foskett v McKeown
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CASE
Mixed Bank Account If T dissipates trust money and later pays own money into account, it will not be regarded as T replacing money that B can claim |
Roscoe v Winder
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CASE
Mixing of 2 trust funds BASIC RULE - First in, first out |
Clayton's case
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CASE
Mixing of 2 trust funds BASIC rule will NOT apply when: a) Impractical (e.g. cannot ascertain which were paid in first) b) Injustice c) Contrary to parties intentions INSTEAD - balance, assets etc will be divided proportionally based on contributions |
Barlow Clowes
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