Resulting Trust
Resulting Trusts meaning
The expression resulting trust comes from a Latin expression ‘reasalire’ which means to ‘jump back’ and a resulting trust if interoperated literally from it ethnological origin the expression means that it is a trust which arises in favour of the settlor. There is a distinction that is made between automatic resulting trusts and presumed resulting trust. The creation of a resulting trust does not require an express declaration of the trust, so that the usual rules of formalities do not apply. The absence of compliance to the usual rules of formalities allows resulting trusts to be created in miscellaneous sets of circumstances, such as:
When the transferor has not parted with the whole of the beneficial interest;
When there is voluntary conveyance into another’s name; and
When a buyer has, property conveyed into the name of another and the person that puts up the money obtains a beneficial interest under resulting trust.
Whether an express Trust fails (for instance, when the beneficiary dies or when there is a surplus of trust funds left over after the trust purpose has been achieved.), the trustee hold the property in resulting trust for the settlor. Here, for example, a settlor attempts to set up a trust but the beneficial interest either wholly or in part “results” or returns to the settlor. This may happen in various situations, such as where the property is conveyed to trustees upon certain trusts which fail or which do not exhaust the beneficial interest. The part that is undisposed of results back to the settlor. For example, if there is a gift on trust for A for life, and then on trust for X if X attains the age of 21, but X dies before the age of 21 within A’s lifetime, the property will result or return on A’s death to the settlor.
Overarching Principle
Resulting Trusts are a concept in equity that is often difficult to pin down to a single, overarching rationale. Equity itself is characterised by broad aims to achieve justice and fairness, infused by an inherent flexibility to approach a variety of ever-changing situations in practice. The question is if we can enclose Resulting Trusts in a comprehensive, coherent doctrine or if, instead, it is just a judicial tool in equity that courts can use flexibly on a case-by-case basis without a single explanation for the concept.
LAW BOOKS
Use the legal textbooks from the Equity Core Series, which were compiled by law Tutor, to read more about the resulting trust. Because they offer example answers, the books in our Q&A Series will help you prepare for exam questions on resulting trusts more easily.
