Bypassing the Beneficiary Principle

• What is the main principle discussed in the context of trusts in the study material?

  Bypassing the Beneficiary Principle
• What case establishes the Beneficiary Principle (BP)?

  • Morice v Bishop of Durham (1804)
  • It emphasizes the necessity of a definite object for a trust.
  • The court must have someone to decree performance.
• What does Lord Grant MR state about trusts with uncertain objects?

  Such trusts are considered undisposed of and cannot be enforced by the court.
• What does Morice v Bishop of Durham (1804) establish regarding the court's control over trusts?

  It establishes that the court will not usurp its control over trusts.
• What is the relationship between the beneficiary and the trustee in a trust?

  The trust depends on the beneficiary having an equitable right against the trustee.
• What approach does England & Wales adopt regarding trusts?

  England & Wales adopts a strict approach.
• What are two examples that illustrate the strict approach to trusts in England & Wales?

  1. The perpetuity period
  2. Failing trusts for abstract purposes
• What was the outcome of Re Astor regarding purpose trusts?

  Re Astor found a purpose trust for the preservation of newspapers void.
• What does the TIO indicate about the courts' approach to trusts?

  • The courts have shown leniency in their strict approach.
  • There are exceptions to the strict application of the Beneficiary Principle.
• What is one of the exceptions to the strict approach regarding trusts?

  A trust for the direct or indirect benefit of individuals.
• What is another exception to the strict approach regarding trusts?

  Donations to unincorporated associations.
• How can a trust creator appear to create a trust for a private purpose?

  By constructing the trust in a way that benefits individuals directly or indirectly.
• How does the situation differ between a trust for a private purpose and a trust for an abstract purpose?

  A trust for a private purpose can benefit individuals, while a trust for an abstract purpose cannot.
• What does Virgo's quote suggest about trusts for non-charitable purposes?

  Such trusts may be valid if they benefit ascertained individuals indirectly.
• What are the two approaches to trusts discussed in the study material?

  1. Traditional (literal) approach
  2. Modern (liberal) approach
• What case is cited as an example of the traditional approach to trusts?

  Leahy v A-G for NSW [1959]
• What was the legal issue in Leahy v A-G for NSW regarding the trust?

  Whether the trust was for an abstract purpose or could benefit individual nuns.
• What was Viscount Simmonds' conclusion regarding the trust in Leahy v A-G for NSW?

  He held that the trust was invalid for being an abstract purpose.
• Why did Viscount Simmonds find the trust in Leahy v A-G for NSW to infringe the perpetuity rule?

  Because the trust was for the perpetual order of nuns.
• What case exemplifies the modern approach to trusts?

  • Re Denley [1969]
  • It involves a trust deed for recreational land primarily benefiting employees.
• What does the court emphasize about charitable trusts in Leahy v A-G for NSW?

  Charitable trusts are beneficial for society.
• What was the purpose of the trust created by Charles Harry Denley in Re Denley?

  To maintain and use land as a recreation or sports ground for employees.
• What legal question arose regarding the trust in Re Denley?

  Whether the clause constituted a valid trust or was an abstract purpose.
• What was John Mills QC's argument regarding the trust in Re Denley?

  He argued that the reference to "such other persons" rendered the clause void.
• What was Gavin A Lightman's position regarding the trust in Re Denley?

  He argued that the primary trusts created a valid purpose trust.
• What did Goff J conclude about the trust in Re Denley?

  He agreed that if a purpose benefits people, it should be outside the mischief of the beneficiary principle.
• What concern did Goff J express regarding the control of the trust in Re Denley?

  He was concerned about the potential for conflicting purposes among employees.
• What did Goff J state about purpose trusts in relation to the beneficiary principle?

  He stated that purpose trusts benefiting individuals are generally outside the mischief of the beneficiary principle.
• What did Goff J conclude about the necessity of ascertainable beneficiaries in private trusts?

  He concluded that individuals must be ascertained or capable of ascertainment for private trusts.
• What concern did Goff J express regarding the court's ability to control the trust in Re Denley?

  He was concerned that conflicting purposes among employees could hinder the court's control.
• What is the overall conclusion regarding the validity of trusts for non-charitable purposes?

  • Trusts for non-charitable purposes may be valid if they benefit individuals.
  • The beneficiary principle applies to ensure there are ascertainable beneficiaries.
• What is the significance of the case In re Gulbenkian’s Settlements?

  It illustrates that trustees do not need to know all possible objects for exercising their power.
• What concern does the author express regarding the trust's control by the court?

  The author is concerned that conflicting purposes among employees may lead to an impasse that the court cannot resolve.
• How can the court execute the trust according to the author's judgment?

  The court can execute the trust by restraining improper use and ordering trustees to allow recreational use of the land.
• What does Virgo speculate about the trust if it were decided today?

  Virgo speculates that it might be classified under the charitable head for the "advancement of amateur sport."
• What factors could affect the validity of the trust in the law of charity according to the author?

  The validity could depend on whether the public benefit test is satisfied, given the personal nexus of beneficiaries.
• Which later case applied the principles from Re Denley?

  Re Lipinski [1976] applied the principles from Re Denley.
• Why might the trust exhibit the necessary public benefit for charitable validity?

  It is likely to exhibit public benefit because it primarily serves the employees of the company.
• How could the phrase "such other persons" affect the argument regarding personal nexus?

  This phrase may be used to argue against the existence of a personal nexus between the company and employee-beneficiaries.
• What is the distinction between a purpose trust and a mere motive in trust law?

  • Purpose trust: A trust established for a specific purpose.
  • Mere motive: The purpose is seen as a moral obligation rather than a binding trust.