Equity: Trust Law

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  • Topic: Trust law, Equity, Fiduciary
  • Pages : 13 (4373 words )
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  • Published : September 19, 2012
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1. Introduction
1. Equity and Trusts
* Equity is a particular body of law, consisting of rights and remedies, which evolved historically through the Courts of Chancery to mitigate the severity of the common law. * The trust has been characterised as the greatest and most distinctive achievement in equity although an exact definition of the trust has proven difficult. * Equity would recognise and enforce rights and duties that were not known to the common law. * E.g. the common law protects the trustee’s legal interest in the property, thus facilitating their dealings with 3rd parties, but if the beneficiaries of the trust wanted to enforce their rights, equity will provide equitable proprietary interest. The Fusion “fallacy”

* The fusion debate arose as to whether the Judicature Acts of 1873 and 1875 had effectively fused common law and equity, and the orthodox view is that the fusion was purely procedural and there are still substantive differences. * Fusion of procedural administration?

* Salt v. Cooper (1880)
* HELD: Main object of the Judicature Acts was to assimilate the transactions of equity and common law. It was not a fusion or anything of the kind. * MCC Proceeds Inc v. Lehman Brothers International (Europe) (1998) * HELD: Substantive rule of law was not altered by the Judicature Acts, which were intended only to achieve procedural improvements in the administration of law and equity. * However, in advocating practical realism, some judges have declared that they have been fused. * Fusion in substance?

* Walsh v. Lonsdale (1882)
* HELD: There is only 1 Court and the equity rule prevails in it. * There are substantive fusion as seen in cases like Boyer v. Warby (1953) – equitable tenants allowed to enforce covenants against successors in title, contravening privity of estate, Tinsley v. Milligan (1994) – assertion of equitable interest (in common law, possible if assertion did not reply on illegal conduct, but in equity, must come in “clean hands”), AG v. Blake (2001), Hedley Byrne & Co Ltd v. Hellen & Partners Ltd (1964) – inclusion of equitable concept of “special” relationship, turning it into quasi-fiduciary when the tort of negligence is a common law concept. * Teo Teo Lee v. Ong Siew Lan (2002)

* HELD: One indication of fusion is where legal remedy may be given for a breach of equitable right. The converse of equitable remedy awarded for breach of legal rights is simply equity exercising its concurrent jurisdiction, not an example of fusion. * A single coherent body of law?

* A degree of fusion in substance, but no complete eradication of distinctions. * Lionel Smith, Fusion and Tradition (2005)
* Andrew Burrows, We Do this At Common Law But That in Equity (2002) * Equitable principles became part of the law of Singapore by virtue of the Second Charter of Justice in 1826. * The Civil Law Act provides that in a number of matters, the rules of equity prevail in any event of a conflict. * s. 3, CLA fuses administration of common law and equitable principles in the same courts – a single court will consider both, but nothing to suggest that it implies that both should be conflated to form a new hybrid of law. * s. 4, CLA provides for specific situations where conflicts occur. * s. 4(13), CLA provides that equity prevails over the common law in matters not found in the CLA – because equity represents the just and conscience-reliant application of legal principles. 2. Distinguishing trusts from other legal concepts

* A person may deal with his property in a variety of ways. His expressed wishes have to be examined in the context of the surrounding circumstances for indications as to the consequences he expects to flow from his actions, so as to determine which relationship ought to be appropriately created. *...
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