By Thomas Luther

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Sample text

In Rose the board of directors did eventually give consent to the transfer: the only reason for the case to come to court was because, under tax law at that time, if Mr Rose could be shown to have transferred his equitable interest in the shares to his wife as soon as he completed the forms there would have been no inheritance tax to pay on the shares after his death, whereas there would have been tax to pay if the court had held there was no transfer until the date of the directors’ agreement.

Those customers who could not demonstrate that their order had been segregated from the general store of bullion could not demonstrate that they were beneficiaries under a trust because the subject matter of that trust was uncertain. 33 Understanding Equity & Trusts To make this point more explicit, let us dramatise the proceedings slightly. If you have seen films like Steve McQueen’s The Thomas Crown Affair or even James Stewart in It’s a Wonderful Life that may help you to visualise what is happening.

There are also two forms of trust which are imposed by the courts: the ‘resulting trust’ and the ‘constructive trust’. These trusts are discussed at length in Chapters 6 and 7 respectively. A short outline of each is given below. Resulting trusts The resulting trust is a means by which equity supplements the ordinary law of property in two circumstances (Westdeutsche Landesbank v Islington (1996)). What is common to both circumstances is that it is the court which imposes the trust: by definition the parties have not declared an express trust.

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