EQUITY AND TRUSTS Essay Example | Topics and Well Written Essays - 2000 words

EQUITY AND TRUSTS - Essay Example The courts, therefore, assigns the property to someone in a resulting trust to avoid vacuum. Megarry VC in Re Sick and Funeral Society of St Johns Sunday school,1 Golcar defined a resulting trust as a property concept which follows that any property that an individual does not properly dispose of remains his. A completely constituted trust implies that the trust property is conferred to the trustees and the trust is binding on the donor who cannot revoke the trust. When the trust property is not properly vested the trust is considered incompletely constituted and it is void as equity will not force the donor to complete the trust. 2 The principles of constitution of trusts are derived from the case of Milroy v Lord3 where Turner L.J. set out three modes of making a gift, which are the actual transfer of property from the person making the gift to the beneficiary, a transfer of the intended gift to the trustees to be held in trust for the beneficiaries or the self-declaration of a trust. The principle in this case is that a gift can only be enforced in equity if it satisfies one of the three modes set out in Milroy. The rationale in this case is that trusts should not be used to protect gifts from being defeated and follows the maxim that equity will not complete an imperfect gift.4 The common rule with regard to imperfect gifts is that equity cannot perfect an imperfect gift and this was demonstrated in Milroy v Lord, where the court held that equity will not assist a volunteer, and as such, equity will not perfect an imperfect gift. In this case Mr. Medley made a deed purporting to transfer shares into Ds title to be held in trust. However the transfer was never made and when Medley died it was held that no valid trust existed and the shares we to go to Medleys estate and not the trust. Where there is lack of