RE BOWDEN: HULBERT V BOWDEN (1936) ALL ER 933

ABSTRACT

The Re Bowden case is significant as it deals with the question of whether a trust created
by a settlor can be revoked or undone after being established. This thesis aims to
elucidate the court's approach to this issue. The stance taken in this legal brief is that
once a trust has been validly declared, the settlor forfeits absolute ownership of the
property. Absolute ownership encompasses both legal and beneficial ownership,
implying that the settlor no longer retains the authority to utilize, transfer, or sell the
property.

INTRODUCTION

The English legal case Bowden (1936) Chapter 71, centres around the question of
whether a settlor, the individual who establishes a trust, can revoke or undo the trust
after it has been established. It involves a woman who, before joining a convent,
transferred her property to a trustee to hold for the benefit of specific beneficiaries.
Later on, she decided to reclaim the property and argued that the trust was invalid. This
case highlights the importance of fully comprehending the long-term implications of
establishing trust. It emphasizes that trusts are significant and permanent decisions, as
once the properties or assets are transferred into a trust, the settlor relinquishes control
over them.

FACTS

Mrs. Bowden, who was the settlor and also the appellant in this case, was a widow who
decided to enter a convent and take a vow of poverty. Before taking her vows, she
transferred her property to trustees, including her daughter, Mrs Hulbert, to benefit her
children and grandchildren. After leaving the convent, Mrs. Bowden decided to reclaim
the property, arguing that the trust was invalid.

However, the trustees, including Mrs Hulbert, opposed Mrs Bowden's claim, stating
that she could not revoke the trust. Mrs Bowden argued that her intentions had changed,
and she had not fully understood the implications of the trust at the time of its creation.
HOLDING

In a recent court ruling, the trustees were granted a favourable decision. It was stated
that once a trust is established and property is transferred, the settlor is unable to
unilaterally retract it and reclaim the assets, irrespective of any subsequent change in
intentions. It is generally not possible for a settlor to reverse or terminate a trust at their
discretion, as the assets and property have been transferred to the trust and the trustees
hold legal ownership. In effect, the trust becomes an autonomous legal entity, with its
own set of rights and obligations.

SIGNIFICANCE

The principle established in Re Bowden, that a trust cannot be revoked simply because
the settlor changes their mind or circumstances change, has been reaffirmed in
subsequent cases and is now a well-established rule of English trust law. This principle
is also recognized in many other jurisdictions that follow the English trust law tradition,
including Zambia.
The Zambian Trustees Act, Chapter 67 of the Laws of Zambia1, which governs the law
of trusts in Zambia, reflects the principle established in Re Bowden. Section 122 of the
Act provides that a trust, once created, cannot be revoked or altered except in
accordance with the terms of the trust or by order of the court. This reinforces the
importance of careful planning and consideration when establishing a trust in Zambia,
to ensure that the trust document accurately reflects the settlor's intentions and the
interests of the beneficiaries.
This principle of finality and certainty in trust law is important to protect the interests
of the beneficiaries and ensure the integrity of the trust relationship. All parties
involved, including the trustees and beneficiaries, have rights and interests that need to
be respected. A useful resource on this topic is "The Law and Practice of Trusts in
Zambia3" by Professor Muna Ndulo, which provides a comprehensive overview of the
law and practice of trusts in Zambia.
In a broader sense, the decision in Re Bowden's case contributes to the overall
understanding of the nature of trusts and their role in estate planning and asset
protection. An irrevocable trust provides protection of assets from creditors, lawsuits,

1
Trustees Act, Chapter 67 of the laws of zambia
2
Section 12, Trustees Act
3
“The Law and Practice of Trusts in Zambia” by Professor Muna Ndulo,
and estate taxes, and can also ensure that the settlor's wishes are carried out after their
passing. Additionally, irrevocable trusts can offer benefits such as Medicaid planning,
charitable giving, and estate tax minimization.
The case of Re Bowden serves as a reminder of the enduring nature of trusts and the
significant consequences they can have on the distribution of property and wealth. It
emphasizes the importance of careful planning, and clear communication in creating
and administering trusts in Zambia, to ensure that they achieve the intended goals and
protect the interests of all parties involved.
As highlighted in Re Bowden (1936) Ch 71 , the irrevocable nature of trusts underscores
the need for careful consideration and planning before establishing a trust. Settlors must
ensure that their intentions are accurately reflected in the trust document, as it may be
difficult or impossible to make changes once the trust has been established. This
includes considering the interests of the beneficiaries, the appointment of appropriate
trustees, and the powers and duties conferred upon them.
In addition to the legal considerations, establishing a trust requires careful financial
planning. Settlors should consider the tax implications of creating a trust, including
potential capital gains tax, inheritance tax, and income tax liabilities. Trusts can be
structured in various ways to minimize tax liabilities and maximize the benefits for
beneficiaries, and professional advice should be sought to ensure the most suitable
structure is chosen.
Trusts can also play an important role in asset protection, particularly in the context of
estate planning. By transferring assets into a trust, the settlor can protect those assets
from potential creditors or legal disputes, ensuring that they are preserved for the
intended beneficiaries. This can be particularly important in situations where the settlor
has significant assets or complex family arrangements.
Moreover, trusts can provide a degree of privacy and confidentiality, as the terms of the
trust and the identities of the beneficiaries are not generally made public. This can be
beneficial for individuals who wish to maintain their privacy or keep their financial
affairs confidential.
In summary, the case of Re Bowden highlights the importance of careful planning,
professional advice, and clear communication in creating and administering trusts.
Trusts can offer significant benefits in terms of estate planning, asset protection, tax
efficiency, and privacy, but it is essential to ensure that they are established and
managed in accordance with the law and the settlor's intentions.l
A relevant case that further illustrates the principles established in Re Bowden is the
English trust law case of Paul v. Paul (1882)4 20 Ch. D. 742. This case involved a trust
created by a father for the benefit of his children, with the intention of providing them
with an income during their lifetimes. The father later attempted to revoke the trust,
arguing that his financial circumstances had changed, and he needed access to the trust
funds.
The court rejected the father's attempt to revoke the trust, holding that the trust was
irrevocable and could not be undone simply because the settlor's circumstances had
changed. The court emphasized the importance of the principle of finality and certainty
in trust law, which protects the interests of the beneficiaries and ensures the integrity of
the trust relationship.
The decision in Paul v. Paul builds on the principles established in Re Bowden,
highlighting the importance of careful planning and consideration when establishing a
trust, as well as the need for trust documents to accurately reflect the settlor's intentions
and the interests of the beneficiaries. The case serves as a reminder of the enduring
nature of trusts and the significant consequences they can have on the distribution of
property and wealth.
In summary, Paul v. Paul is a relevant case that reinforces the principles of irrevocability
and finality in trust law, emphasizing the need for caution and foresight when using
trusts as a legal instrument in estate planning and asset protection.
CONCLUSION

The recent legal case reaffirmed the well-established trust law principle that once a trust
is validly established, it cannot be unilaterally revoked or undone by the creator. This
decision underscores the critical importance of carefully considering the permanent
nature of trusts before creating them, as they are intended to provide stability and
security for asset management and distribution. The case also highlights the need for
precise drafting of trust documents to ensure that the settlor's intentions and
beneficiaries' interests are accurately reflected. Ultimately, this ruling serves as a
reminder that trusts are powerful legal tools that should be used thoughtfully and with
great care, given their long-lasting impact on the distribution of property, assets, and
wealth.

4
Paul v. Paul (1882) 20 Ch. D. 742
PAUL V CONSTANCE [1977] 1 WLR 527

ABSRTACT

The decision in Paul v Constance is vital in that it sets out what will be sufficient to
establish that someone has intended to create a trust. The first of the three certainties; it
should be necessary that a settlor words and actions show a clear intention to dispose
of property for the sake of another’s beneficial interest. This is regarded as a border line
decision but it illustrates the fact that the settlor does not require the use of technical
words to declare themselves as trustee.

The article looks at the position the court of appeal took in determining that the parties’
words and conduct demonstrated that he had wished for the money to be held on trust
for Mr Constance and Mrs Paul jointly. As such the elaboration in this commentary
wishes to shed more that on the pending subject.

This was an appeal to the court of appeal of England and Wales from its lower courts
that the defendant appealed on the question of law as to whether there was in
circumstance of this case an express declaration of a trust. The plaintiffs case was based
of the account belonging to the deceased was held on trust for the benefit of the
deceased and herself jointly. The evidence relied upon in the circumstance were the
words ‘this money is as much your as mine,’ used repeatedly by the deceased. However,
the defendant’s case was that the account formed a part of his estate and was not held
on trust for anyone else. The court of appeal thus set aside the verdict granted by the
said lower court and in turn resorted to considering the merits of the matter in contrast
to mere circumstantiality.

The case under consideration is not of mere suggestion of a gift by transfer, what can
be taken away from the case is that there must be an explicit declaration of a trust.

INTRODUCTION

This case was initially presented on trial before Judge Rawlings in Cheltenham country
court, the judge found in favour of the plaintiff. He found there was an express trust,
for the benefit of the plaintiff and the deceased jointly, and the defendant was required
to pay the sum of 499.21 euros to the plaintiff, which represented one half-share of the
fund which was to be beneficially entitled to.
FACTS

The deceased Dennis Albert Constance, who was married to the defendant until 1965,
when their marriage broke down. From 1967 the deceased and the plaintiff, Miss Paul,
lived together until the passing of the deceased until the date 1974, who died intestate.

The deceased never divorced his first wife. In 1969 the deceased received a sum of 950
euros by cheque. The deceased and the plaintiff both decided that the money earned
was to be allocated in a bank account. And as such a deposit account was opened in the
name of the deceased only as there were not married.

The bank manager had advised the deceased, that the plaintiff would be able to
withdraw the money in the account provided that she had authorisation prior to the
withdraw being carried out. The account was maintained in the name of the deceased
down till the time of his death.

The deceased as well as the plaintiff both participated in a bingo match, and they did
so as a joint venture. They were declared as winners of the game and were awarded,
afterwards deposited their winnings into their joint account. As time went by the
deceased would repeatedly reaffirm the statement “this money is as much mine as
yours.”

When the deceased died intestate in 1974, the deceased’s wife, the defendant as the
administratrix of his estate closed the account and put up the claim concerning the sums
contained in the account at the time of his death forming part of his estate.

The plaintiff claimed the bank account in the name of the deceased’s name was held on
trust for the benefit of himself as well as the plaintiff jointly. She claimed that it was an
express trust declared orally by him on a number of occasions.

HOLDING

The court of appeal held that the parties’ words and conduct demonstrated that he
wished for the money to be in a trust for Mr Constance and Miss Paul jointly. The
defendant contained that an express trust was never created to this effect.
As per the case of Jones v Lock5 and Richard v Delbridge6 show that a man may clearly
and unmistakably state that he intends to make gift to someone, this does not necessarily
disclose a declaration of a trust. Even if the intention to make a gift was clear. Intention
to gift something is not enough to establish a trust.

SIGNIFICANCE

The case highlights the fact that the certainty of intention is vital for the clear intention
of the settlor, to bind a trustee with duties. The case of Paul v Constance has undermined
the aspect of a trust law, which has, it is argued, thrown the light of this crucial area.
An intention to create a trust can also be inferred from the conduct of the donor. Two
equitable maxim to consider are ‘equity will not perfect an imperfect gift’ and ‘equity
looks at the intend and not the form’. 7Thus, equity will hold that a trust has been created
even though the word ‘trust’ was not used as in this case.

To explain the maxim ‘equity looks at the intend not the form’, when considering
whether a trust has been created or not, the courts will look at the surrounding
circumstances to discover whether the settlor intended to create a trust rather than
focussing solely on the form of words he used which that “this money is as much as
yours as mine’’.

The decision in Paul v Constance in 1977 is still relevant today when not everyone
clearly states I am leaving such property to you on trust but through their conduct
indicate the intention to leave such property to them on trust. Following the decision in
this case, the courts may look at what was done as a pose to what a reasonable person
may be infer.

The certainty of intention is an essential element of crafting up a trust as it is easily

identifiable whether a trust exists or not.

The case of Paul v Constance brings about the question what is actually meant by an
‘intention to create a trust’. It brings out the fact or highlights that ‘an intention to create
a trust’ may be also construed from the settlor’s words and conduct.

5
[1865]1 Ch App 25
6
[1874] LR 18 Eq 11 CA
7
Optimize Equity and Trusts, 2nd Edition, Judith Riches, page 25
CONCLUSION

The case of Paul v Constance is important because it sets a fine line on essence on
certainty of intention is and how valid the three certainties really are. The decision has
shown that one can intend to create a trust without actually drafting up a trust document
but even through his words, words that are used repeatedly as seen in the case ‘’this
money is as much yours than mine’’ and the conduct construe that one intended to
create the trust.
SHAH V SHAH [2010] EWCA CIV 1408

ABSTRACT

The case of Shah v. Shah gives us an insight on the aspect of intention when it comes
to the creation of a trust. It alludes to the fact that, the word ‘trust’ might not be used
all the time to show that a trust was created but rather the intention of the person creating
the trust, can be proof enough to know that there was a valid trust that was made.

This article looks at the approach the Court of Appeal took regarding, decision in Shah
v. Shah in which the appellant sought to recall his gift on various grounds including
mistake and misrepresentation among the points taken by the appellant was that certain
events should be construed as an attempt to make an immediate gift which had failed
and which equity would not perfect by way of imposition of a trust.

The position of this writing is to show that an imperfect gift is not a declaration of a
trust. If the stock transfer form manifested an intention to make a gift, the letter should
not be construed as a declaration of a trust.

INTRODUCTION

This was an appeal by the defendant to the high court on construction of the letter and
execution of the shares transfer from which the claimant had declared a trust.

The High Court found in favor of the claimant that the share transfer did not result into
a trust. The defendant was not satisfied with the decision of the High court and appealed
to the Court of Appeal.

FACTS

The company in question was incorporated in 1977 and later converted into a public
limited company (Plc) in 1995. Mr. Dinesh shah executed a letter disposing of shares
in favor of his brother Mr. Mahindra shah.

The appellant is Mr. Dinesh shah who was unsuccessful in his two sets of preceding
tried together a chancery action and petition under section 994 of the Company’s Act 8
.He now appeals from the orders of the court dated on 24th February 2010 in three
aspects (1) the declaration that the letter dated 11 march 2005 was signed by him and

8
Company Act 2006
constituted a declaration of trust over,4000 of his shares in the muster Dee international
plc the company.(2)The dismissal of the claim that this declaration of trust was
procured by misrepresentation or was executed under a mistake of law.(3)Mr. Dinesh
had five brothers but Mr. Mahindra shah was not part of the company until he was
incorporated in the company in 1977 and the company was later converted into a public
limited company in 1995 .

The gift of a legal interest in a share is not complete until registration has taken place
and registration may under the company’s Article of association be subject to discretion
of the directions of the company.

However, Mr. Rajnikant shah left the company and ceased to be part of the company.
He found that any agreement was binding in honor only. However, they met together
on the following judgement, and Mr. Dinesh shah executed and delivered letters in the
same form in favor of Mr. Mahindra shah.in addition they 4000 share we're registered
in 2005 and claimed certificate.

HOLDING

The holding in the case of shah v shah is that Mr. Dinesh was deemed in law to have
intended a trust and not a gift. The Privy Council held that the disposition in favor of
his brother Mr. Mahindra shah, must fail because it was an incompletely constituted
gift and thus equity cannot complete it.

Dismissing the appeal, the court decided that on construction of the letter and the
execution the share transfer form, Dinesh had declared a trust of shares in favor of
Mahindra. The question of intention to create a trust was to be judged objectively by
reference to the wording of the letter and the facts. The terms of the letter indicated an
intention from the date of its execution that Dinesh was holding shares for Mahindra.
The use of words ‘as from today’ and ‘Declaration’ had that effect. These words
conveyed an intention to hold the beneficial interest in shares for Mahindra until
registration9.

9
Riches J. (2017) Optimize Equity and Trusts, 2nd Edition, Routledge, New York.
SIGNIFICANCE

This case highlights the legal intricacies involved in the transfer of shares and the
importance of clear intentions and formalities in the gifting process. An imperfect gift
is not a declaration of a trust, if a gift is not properly constituted (for example, if a share
certificate is not tendered), equity will not 'perfect' it by imposing a trust.

It helps determine the validity of a trust through the words manifested by a person as
seen in Paul v Constance10-“The court considers the substance and effect of the words
used.”

Therefore, despite not having clearly stated the exact share of the 4000 shares of Dinesh
total shareholding in the company, there was no need to identify them for the certainty
off subject was present as it was stated in the case of Hunter v Moss11

It provides clarity on the distinction between an imperfect gift and a declaration of trust,
the requirements for the completion of a gift, and the grounds on which a gift can be
recalled. It has important implications for the transfer of shares and the establishment
of trusts.

CONCLUSION

The decision in this matter is important because it brings and highlights the importance
that an imperfect gift is not a trust. That for a valid gift to be constituted it’s a mandatory
requirement that it should be registered as Equity does not perfect an imperfect gift.

10
[1977] 1 WLR 527
11
[1994] 1 WLR 452
JONES V LOCKE [1865] 1 Ch. App 25

ABSTRACT

The case of Jones v Locke encompasses an important principle which brings to light
the aspect of intention in creation of trusts and gifts. The decision in this case puts
emphasis on that, if a gift is not properly completed with the legal form a trust cannot
be formed.

The purpose of this writing is to look at the approach the court of Appeal in Chancery
took when deciding this case and provide clarity on the method and necessary
procedures when to create a valid trust or gift.

INTRODUCTION

Jones v Locke is an English trusts law case that revolves around the formality required
for creating a gift. It also explores the intriguing possibility that if a gift is not properly
completed with the required legal form, a trust could still be found. In this legal saga,
the central question emerges: Would equity intervene to perfect an imperfect gift by
establishing a trust if the necessary formalities were not fulfilled.

In this case the court dealt with the issue of precatory estoppel, which is a legal doctrine
that allows a party to claim an interest in property based on the promises or assurances
made by another party. The court considered whether jones the claimant was entitled
to an interest in the property owned by Locke, the defendant, based on the
representation and actions of Locke which the court of chancery placed judgement.

FACTS

Mr. Jones had children with the first wife and a nine months old baby with the second
wife. When he returned from business visit, his second wife asked him if he has brought
anything for his son, he took out a cheque of 900 pounds drawn in his name saying “I
give this to baby, it is for him and am going to put it away for him and I will give him
a great deal along with it”. He then placed the cheque into the baby’s hand and the wife
told him not to let the child tear the cheque, he then took away the cheque from the son
and locked it into an iron safe. The cheque was received in payment of mortgage a short
time before, and expressed to Mr. Locke his solicitor the intention of adding another
100 pounds to it and investing it for the benefit of the infant. On 18th September, he
meets Mr. Locke and said “I shall come over to your office to alter my will that I may
take of my son”, unfortunately he died the same day and Mr. Locke found a cheque in
the safe and obtained payment as part of the estate.

Robert Jones had made a will before the birth of the infant, giving an annuity to his
wife and giving the rest of his property for the benefit of his other children. A suit was
instituted for the administration of the estate and the mother carried against the estate.
The 900 cheque that was given to the infant did not have the infants name for it to be
evident that it was his.

HOLDING

The court held that there was no express trust in favor of the infant son. The evidence
indicated an intention to make a gift of the cheque to the infant, not to declare a trust.
Equity does not perfect an imperfect gift. Voluntary settlements are valid only when
the settlor has done everything necessary to transfer the property and render the
settlement binding. In this case, the intention was not carried into effect, and there had
been no formal declaration of trust.” The cheque was not a gift to the son since it was
payable to Robert Jones, nor could his loose conversation be construed as a declaration
of trust. Therefore, the cheque formed part of his estate.12

SIGNIFICANCE

This case highlights that in loose conversations, words alone do not necessarily
constitute a valid trust or gift. Trust and meaningful gifts often require more than just
verbal expressions. Actions, consistency, and genuine intent play crucial roles in
building trust and demonstrating the value of a gift. So, while words can convey
intentions, it’s the follow-through that truly matters. Jones v Lock emphasizes that an
express trust requires clear intent, and equity does not save failed gifts by converting
them into trusts. The case serves as a reference for understanding trust creation and the
importance as in the case of Antobus v Smith13 it is found that “the subject of intention
was clear and present but the gift was incomplete and held void”, it shows that one may
make their intentions clear but the gift may still not be complete due to necessary

12
Optimize Equity and Trust by Riches J (2017) 2ND Edition
13
(1806) 12 Vest
formalities not being fulfilled. Equity does not complete an incomplete gift” as the gift
was not accordance with the formalities.

CONCLUSION

The decision in this matter highlights on how loose conversation cannot lead to a
declaration of a trust if the transaction is incomplete.
RE VANDERVELL’S TRUST LTD NO. 2 [1974] CH 269 (EWHC)

ABSTRACT

The holding or rather decision made in this case is an imperative decision because it
helps to highlight and clarify how the law would adjudicate a case regarding how a
presumed resulting trusts and automatic resulting trust come about, together with the
principle of how the court handles cases where a settlor fails to dispose-off his estate in
a trust absolutely.

The article at hand delves into the approach of the court of appeal regarding whether
the shares were to be held on resulting trust or an express trust was formed for the
children as the beneficiaries.

This article seeks to provide understanding on where and how a resulting trust is applied
in the courts of law together with the one of the different ways an express trust is
formed, furthermore in the court of appeal it was held that an express trust was formed
on the basis that Vandervells trust company bought the shares using the trust fund from
the children’s settlement in 1949.

INTRODUCTION

This is an appeal for the decision made in the high court which errored in saying that
the options exercised by the trustee company to buy back the shares from RCS created
an automatic resulting trust for Mr. Vandervell. This meant that the dividends from
1961 to 1965 were part of the Vandervell estate and not part of the children settlement
trust. The court of appeal nullified the judgement of the high court. The appeal court
further answered the question whether the express trust should be in writing according
to section 53(1)(c) of the Law of Property Act of 1925.

FACTS

Tony Vandervell, a wealthy racing car manufacturer, was attempting to make a

donation to the Royal College of Surgeons to establish a chair in his name. Since large
donations were taxed at the time, he granted the College a number of shares in his
company, and paid dividends on those shares, which the College (being a charity),
would receive tax-free. However, this scheme was defeated in the case Vandervell v
Inland Revenue Council14

Vandervell therefore had the shares repurchased by a trust company set up to manage
his children's inheritance, through an option that had been granted during the setup of
the original tax-avoidance scheme. As such, the trust company considered themselves
as holding the purchased shares on trust for the children, and Vandervell proceeded to
pay dividends on the shares with the intention of benefiting his children. However, the
tax authority continued to view the shares as being Vandervell's personal property and
charged him taxes on the dividends paid. So Vandervell signed a document explicitly
transferring any remaining rights in the shares to the trust company. Mr vandervell
wrote a will in 1967 in which he said that he would not include the children in the will
owing to the fact that he included then in the trust settlement created in 1949.Two years
later Vandervell died, but the tax authority continued to seek payment of taxes on all
dividends paid to the shares after the trust company exercised the option. Furthermore,
on the same basis, Vandervell's own executors made a claim to recover the dividends
themselves from the trust company.

HOLDING

In the high court, Megarry J gave judgment, holding that there was liability to pay tax.
He distinguished two kinds of resulting trusts as "presumed resulting trusts", where the
courts presume the parties' intend to make a resulting trust, and "automatic resulting
trusts", where assets are passed to a trustee on express trusts, but a surplus remains. In
each case the assets return (or result back) to the transferor.

Court of Appeal

The Court of Appeal (overturning the judgment of Megarry J in the High Court) held
that the option ceased to exist once it was exercised. Thus, there was no disposition,
and no consequent liability to pay tax. It also held that the children were the equitable
owners of the shares, and, as such, Vandervell had divested himself of equitable
ownership of the shares. The court of appeal held that the automatic resulting trust came
to an end when the option was exercised in 1961.And the trust being of personality, did
not require writing under s53(1)(b), as it was not a trust of land, or section53(1)(c), as
the resulting trust no longer existed. It was also held that since the money that was used

14
[1967] 2 AC 291
to purchase back the shares from RCS was from the children’s trust settlement, became
part of the children’s trust.

SIGNIFICANCE
The case highlights the difference between an express and a resulting trust. Lord
denning said that the resulting trust came to an end after the trustee company exercising
the option of the share purchase. But one would say that Mr. Vandervell did not identify
the beneficiary neither did all his beneficial interest cease in the shares, however the
shares were bought from the trust money of the children and hence part of the children’s
estate15, therefore indicating that the children were the beneficial owners of the shares
bought.

The other importance of this case is that it answers whether an express trust should be
in writing for it to be enforceable. Looking at the case of Paul v Constance 16an express
trust was formulated by mere actions and concurrent use of the words “the money is as
much as yours as it is mine”.

The trustee in the appeal court argued that from 1961 -1965 Mr. Vandervell was the
beneficial owner of the estate due to lack of writing about the existence of the express
trust, however, it is important to note that Mr. Vandervell had the intention of creating
a trust for the children from the beginning, this was proved by the letter written by the
solicitors of Mr. Vandervell to the revenue authorities. The letter said that the trustee
company bought the shares for the purpose of the children’s trust 17.Mr. Vandervell
further expressed his intention to create the express trust by the will that he wrote, in
the will that he wrote in 1967 he expressly said that he would not make any provision
for the children due to the settlement he created for them. From these strong points we
can see that Mr. Vandervell had the intention to create the express trust for his children.
The executors relied on the fact that lack of writing for the express trust as per s53(1)(c)
of the laws of property act of 1945 18which states that

“A disposition of an equitable interest or trust sub sitting at the time of the

disposition , must be in writing signed by the person disposing the same , or by
his agent there unto lawfully authorised in writing or by will.”

15
Judith Riches “Equity And Trusts” 2rd Edition
16
[1977] 1 W.L.R 527
17
www.Vlexjustis.co.uk
18
Lands and property act
However, Lord denning argued that the resulting trust for the settlor is born and dies
without any writing at all. Apart from that lord Dening said the shares is not land for it
to in accordance with the s53(1)(c) . this is because s53(1)(c) is subject to s53(1) of
The United Kingdom Laws Of Property Act Of 1925 which states that

“subject to the provision hereinafter contained with respect to the creation of interest
in land by parol”

Moreover equity looks at the intention rather than the form and technicalities cannot
dispute the intention of Mr.Vandervell.

CONCLUSION

In a nutshell the case answered the question of whether or not an express trust needs to
be registered according to s53(c) of the Laws of Property Act, in addition, it also
answers the fact to when a resulting trust can be turned to an express trust, and from the
decision made in the high court it shows how a presumed resulting trust and automatic
resulting trust, above all from all these arguments the appeal court said that the high
court errored in considering that a resulting trust was created for Mr.Vandervell, rather
than an express trust for the children.
ROWE V PRANCE [1999] ALL ER D 496.

ABSTRACT

In the case of Rowe v Prance, Mrs Rowe seeks a declaration asserting her beneficial
ownership of a half share in the proceeds from the sale of a yacht named “Edwardiann
Castle”, which was initially registered solely under Mr Prance’s name. The dispute
revolves around whether Mr Prance constituted himself as a trustee for both himself
and Mrs Rowe regarding the yacht, or Whether a constructive trust arises under certain
principles.

The evidence presented includes testimonies from both Mrs Rowe and Mr Prance, with
Mrs Rowe being considered honest and straightforward, while Mr Prance is viewed as
an unreliable witness. The facts of their relationship, including promises of marriage
and shared living arrangements, are crucial to understanding witness. The facts of their
relationship, including promises of marriage and shared living arrangements, are crucial
to understanding the case.

Throughout the years, there were discussions about joint ownership and shared living
arrangements, including plans to sail around the world together. Mrs Rowe actively
participated in finding the yacht and negotiating its purchase. Despite Mr Prance’s
attempts to present the yacht and negotiating its purchase as solely his property, various
aspects of their interactions, such as referring to the yacht as “ours”, suggest joint
ownership intentions.

Ultimately, the court rules in favor of Mrs Rowe, finding that Mr Prance effectively
constituted himself as a trustee of the yacht, with equal shares intended for both parties.
The court emphasizes the use of the word “our,”and discussions about security
indicating Mrs Rowe’s substantial interest . As a result, Mrs Rowe’s claim for half a
share in the proceeds of the yacht’s sale succeeds.

INTRODUCTION

In this case, the Plaintiff/Claimant ("Mrs Rowe") seeks a declaration that she is the
beneficial owner of a half share in the proceeds of sale of a yacht named "Edwardiann
Castle ("the Boat"). The Boat was, until its sale in the circumstances which I shall
describe later in this judgment, registered in the sole name of the Defendant ("Mr
Prance").Mrs Rowe claims a half share in the Boat, and now its proceeds of sale, on
the footing either (a) that Mr Prance expressly constituted himself a trustee of the Boat
for himself and her or (b)that a constructive trust arises under the principle.

FACTS

the parties first met in late 1981.They re-met in about May 1982 shortly after which
they became lovers. Mr Prance was married at the time to the wife to whom he has at
all times remained, and remains, married. Mrs Rowe was widowed. Mr Prance said on
a number of occasions over the next year or two that he would divorce his wife and
marry Mrs Rowe to live with her, although he did not leave his wife at this time. Mrs
'Prance ran a "bed and breakfast" business to earn some money, and there was also
stabling rented out. Mr Prance had his own business which he ran it does not appear
that it produced any income for him during any relevant period. Mr Prance's income
was derived mainly from a trust fund set up by his mother.

In late 1985, Mr Prance proposed marriage and Mrs Rowe agreed. The parties agreed
that each of them would sell their respective homes and buy a property in which to live
together. he told his wife he wanted a divorce but that she would not agree to it. Mrs
Rowe sold the property in which she was living and put her furniture into storage, but
Mr Prance did not sell any property Mrs Rowe and Mr Prance found a house to buy
together in Headcorn. This was sometime in the spring of 1986. In June 1986, the sale
did fall through and the relationship temporarily ceased. after a few weeks, they
resumed seeing each other. Mr. Prance informed his wife about everything and
promised not to leave her, as per his wife's request.

It is one of the more remarkable aspects of their relationship that they spoke on the
phone

every day, often more than once, throughout the 14 years from 1982 to 1986 when their
relationship finally came to an end, with the possible exception of times when Mr
Prance was on

holiday with his wife and a few other occasions.

In 1987 Mr Prance acquired an aero-plane: he held . He kept this plane in which Mrs
Rowe had no beneficial interest in Headcorn. They flew together a great deal visiting
the Channel Islands and European destinations. When the plane was sold the proceeds
of sale were used to pay the deposit on the purchase of the Boat in the circumstances
which I describe later.

In a conversation in 1990, Mr Prance expressed to Mrs Rowe that everything would be

ideal if he could purchase his wife’s share of her property, allowing him and Mrs Rowe
too reside there together. During cross-examination, Mr Prance clarified that this
scenario would have been perfect because it would have allowed him to have all this
machinery, essential for his business, at the property he cherished. He characterized this
as a hypothetical description of an ideal situation that did not come to fruition.

But he says that he never contemplated it because he had no intention of leaving his
wife.

what she believed Mr Prance had always promised her, that is to say that they should
have a home

together. However, Mr Prance did not buy out his wife: indeed, he says he never raised
the question with her because he knew she would not agree to it to enable him to live
with Mrs Rowe.

During 1993, Mr Prance failed his medical examination for his pilot’s license renewal
and decided to sell the plane. He had been talking with some sailing friends and came
up with the idea of buying a yacht. and discussed with Mrs Rowe his idea that they
should sail the world together for an indefinite period. Mr Prance admits these plans
(although not the statement that they would share the boat in the sense of sharing its
ownership).

They eventually found a yacht named butterfly, and Mr Prance was primarily
responsible for its purchase, despite Mrs Rowe,s initial involvement. The
correspondence regarding the yacht’s purchase indicated shifting dynamics regarding
ownership, with Mr Prance eventually asserting sole ownership.

In 1993, Mr prance and his wife decided to sell their property, with part of the proceeds
used to finance the yacht. Mrs Rowe transitioned to living on the yacht while Mr Prance
continued business obligations in Kent. There were discussions about purchasing a land
base, but Mr Prance seemed reluctant.
Regarding the yacht's registration, there was a dispute about whether Mrs Rowe was
told it couldn't be registered jointly due her lack of certification, which she denies. The
relationship was characterized by discussions of living together and marriage, including
the purchase of rings indicating a close bond.

In 1996, tensions arose, leading Mrs Rowe to demand her share of the yacht’s value,
resulting in legal proceedings. Despite this, they briefly considered buying a house
together, but Mr Prance insisted on sole ownership, exhibiting inconsistencies in his
testimony. Ultimately, the purchase was made solely in Mr Prance’s name, casting
doubt on his credibility.

HOLDING

In the light of the evidence presented and the findings of fact, the court rules in favor
of Mrs Rowe. Mr Prance effectively constituted himself as an express trustee of the
boat, discussions about the security where Mr Prance implied Mrs Rowe substantial
interest, and Mr Prance’s statement regarding the size of the shares, the court infers
equal ownership based on the maxim of ‘equality is equity’. Therefore, the court holds
that both Mr Prance and Mrs Rowe are entitled to equal shares of ownership in the boat.
As a result, Mrs Rowe’s claim is upheld, and she is granted the appropriate share of the
boat’s ownership.

SIGNIFICANCE

First, it is said that there is an express declaration of trust; the case is similar to Paul v
Constance19

where often repeated statements that “the money is as much yours as mine” were
sufficient to create a trust. So it is said in the present case that the regular use of “our”
in relation to the Boat, coupled with the explanation why the Boat was not registered in
joint names establishes that the Boat was held by Mr Prance on trust for himself and
Mrs Rowe equally.

Secondly, it is said that a constructive trust arises. This is a constructive trust in the first
category set out by Lord Bridge in Lloyd’s Bank v Rosset 20similar to the first category

19 [1977] 1 WLR 527

20 [1991] 1 A.C. 107
considered by Nourse LJ in Grant v Edwards21. Where Nourse LJ said Where property
was purchased in single name, and the claimant did not contribute financially such that
a presumed resulting trust applies, equity will infer a trust if, there was common
intention that both should have beneficial interest in the property and The claimant
acted upon that intention.

That is to say of an agreement to the effect that there should be a beneficial interest in
Mrs Rowe. It is accepted that a person seeking to set up such a constructive trust has to
show a detriment to himself, but it is said that there is sufficient detriment in Mrs Rowe
giving up her tenancy and putting her furniture into storage; reliance is also placed on
the domestic work and purchase of food. It is also said that the agreement or
understanding that there should be a beneficial interest also quantified that interest at
one half.

CONCLUSION

The conclusion of the Rowe v Prance case emphasizes the significance of clear
intentions and equitable principles in determining ownership disputes. Mrs Rowe's
successful claim for a half share in the yacht's proceeds underscores the court's
recognition of implied trusts and joint ownership agreements, despite Mr Prance's
attempts to assert sole ownership. The ruling reaffirms the importance of consistency
and mutual understanding in legal relationships, highlighting Mrs Rowe's substantial
contributions and the court's commitment to upholding fairness and equity in such
matters.

21 [1986] Ch. 638

MIRRIAM MBOLELA V ADAM BOTA APPEAL NO.146/2014

ABSTRACT

The judgment in the case of Mirriam Mbolela v Adam Bota holds significant
importance as it sheds light on the legal authority vested in administrators concerning
Section 19(2) of the Intestate Succession Act22. This decision reaffirms and provides a
clear interpretation of the provisions within the Act, ensuring a proper understanding
of the administrator’s authority and responsibilities.

This analysis delves into the approach taken by the Supreme Court of Zambia regarding
the sale of an estate of the deceased by the administrator. The validity of the contract
was also challenged, suggesting that if the administrator acted beyond their authority,
the contract could be deemed illegal, rendering it unenforceable.

This writing emphasizes a crucial aspect of the law of Succession stating that an
administrator is prohibited from selling estate property without court authorization.
Nevertheless, the court's stance in this case asserts that Section 19(2) places the
responsibility on the administrator to demonstrate to the court the necessity or
desirability of selling any estate property to fulfill their duties.

INTRODUCTION

This Supreme Court judgment was delivered as an appeal following a High Court
decision. The appellant attempted to invoke Section 19(2) of the Intestate Succession
Act, which allows administrators to sell a deceased's estate but only with court
approval.

The High Court held the lack of pre-existing court authorization for the sale cannot
serve as a defense against an application for specific performance of a contract to sell
real estate or a house. The trial Judge espoused that the provision in the Interstate
Succession Act does not bar administrators from initiating offers or entering into
contracts for the sale of estate properties without prior court consent, as they can seek
approval from the court before finalizing the transaction. However Supreme Court
overturned the High Court’s ruling by addressing the legal technicalities and
interpreting the statutory provision accordingly.

22
Intestate Succession Act Chapter 59 of the Laws of Zambia section 19(2)
FACTS

In January 2009, the appellant leased a property to the respondent, which was a house
owned by her late husband, Boyd Muleya. Later in the same year, on November 18,
2009, the appellant initiated communication with the respondent, offering to sell the
property to him through a text message. This offer was made at a price of K170, 000.00.
The respondent responded affirmatively to this offer on November 26, 2009, indicating
his acceptance to purchase the property.

However, on November 29, 2009, the respondent sent a letter to the appellant
expressing concerns about the condition of the property and objecting to her decision
to advertise it for sale. Despite these concerns, the respondent reiterated his acceptance
of the purchase offer.

In response, on December 2, 2009, the respondent initiated legal proceedings by filing

a writ of summons in the High Court, seeking specific performance of the alleged
contract of sale.

On January 29, 2010, the appellant filed a defense and counterclaim. In her defense,
she denied offering to sell the property to the respondent, asserting that the property
was a vital source of income for her children. Additionally, the counterclaim sought
rent arrears from September 2009 onwards and possession of the house.

Following these legal actions, on January 28, 2010, the lower court issued an interim
injunction, preventing the appellant from evicting the respondent pending the final
resolution of the dispute. Subsequently, the appellant applied for a review of this
decision.

On August 6, 2010, the review was granted, and the interim injunction was lifted.
Additionally, the court ordered that K10, 000.00 held by the court, deposited by the
respondent, should be paid to the appellant as partial payment of rent arrears.

Further legal action ensued, with the appellant seeking to preserve the property. On
March 2, 2011, the lower court granted an order appointing an assistant registrar of the
Kitwe High Court to manage the property, collect rent, and ensure its preservation,
pending the final determination of the matter. This was done to meet the needs of the
appellant's two minor children, for whom the property served as an important source of
support.
During the trial, the respondent argued that there was a binding contract of sale between
him and the appellant, and he sought damages for breach of contract.

The appellant contested this, asserting her intention to frustrate the respondent's
attempts to purchase the property and maintain it for her children's benefit.

After considering the evidence presented by both parties, the trial judge ruled in favor
of the respondent. The judge ordered specific performance of the alleged sale contract,
granting possession of the property to the respondent and awarding damages for breach
of contract. The appellant's counterclaim was dismissed, and she was ordered to bear
the costs of the proceedings.

HOLDING

The appeal was based on 7 grounds that all emanated from the interpretation of the
Intestate Succession Act.

However it was found that the High Court Judge erred in her interpretation of the
statutory provision that has been aforementioned. The Supreme Court held that the
initiation of a sale transaction begins with the offer. Therefore, the correct interpretation
of section 19(2) of the Act mandates seeking court authorization before an administrator
of the estate makes an offer to a potential buyer. Based on the evidence presented in the
lower court, it is evident that the appellant did not obtain court authorization to sell the
property to the respondent.

In the absence of such authorization, the court concurs with the appellant's counsel that
the purported sale would be illegal and unenforceable. Additionally, the court asserts
that such a transaction would be null and void ab initio. This precedent is reflected in
the Boniface Kafula case, wherein the court ordered a refund of the purchase price
under similar circumstances, as the property was sold without the administrator of the
estate obtaining court authorization.

Therefore all the 7 grounds of appeal were successful, therefore the Supreme Court
allowed this appeal and set aside the lower court's judgment.
SIGNIFICANCE

This case elucidates more on the interpretation of section 19(2) of the intestate
succession act and focuses on asserting the authority an administrator.

However in reference to this, the case of Borniface Kafula and 8 Others v Billings
Choonga Mudenda23 was cited were, despite the contract of sale having been executed
and completed by the administrator and the purchaser, the court ordered a refund of the
sum of now K60, 000.00 as no authority had been obtained from the court prior to the
sale. The Supreme Court relied on this case in rendering there judgement as the facts
were similar has it set a Judicial precedence.

An important principle was espoused in the case of Philips v Copping24 were it was
alluded to that, “It is the duty of the court when asked to give judgment which is
contrary to statute to take the point, although the litigants may not take it. Illegality once
brought to the attention of the Court overrides all questions of pleadings, including any
admission made therein.” However it is paramount to espouse that based on the
underlining principle illegality, once brought to the attention of the court, overrides and
supersedes any arguments made by the parties or admissions within their pleadings.

However it is tantamount to acknowledge that there existed neither a valid nor

enforceable contract of sale, nor was there a note or memorandum that would satisfy
the requirements outlined in section 4 of the Statute of Frauds 167725. Notably, the
absence of a signed contract of sale failed to provide sufficient evidence to substantiate
the purported sale of the disputed house. This because the contract did not contain all
the material terms of the contract namely; the nature of the consideration, adequate
identification of the parties and subject matter.

It is a fact that the letter which stated that the property was advertised and any other
interested persons were entitled to view it without any hindrance from the landlord and
tenant. This is evident in the case of Workers Compensation Fund Control Board v
Kangombe and Company26 were we stated as follows:

23
Appeal No. 202 of 2003
24
[1935] 1 KBl
25
Statute of Frauds 1677, section 4
26
Appeal No.113/2001
“In this case, the Defendant even later resiled from its intention to sell the house in
question saying it would keep it as its housing stock to accommodate its employees and
we know of no law, constitutional or the general law, which forces an unwilling person
to sell his property. The motive of a property owner not to sell is irrelevant.”

In the aforementioned case the court highlights the principle that a property owner
cannot be compelled to sell against their will. The defendant in that case rescinded their
intention to sell the house, decided instead to retain it for housing their employees.
Therefore it is important to establish that the motive of the property owner is irrelevant
as the Law does not mandate a property owner to sell their property.

Furthermore, it is imperative that there should be an establishment of both practicality

and legal authority in enforcing contractual obligation. This principle was propounded
upon in the cases of Development Bank of Zambia & Livingstone Saw Mills Limited
v Jet Cheer Development (Z)27 and Mobil Oil (Zambia) Limited v Loto Petroleum
Distributors Limited28 were the High Court stated that, “A court will not grant a decree
for specific performance of a contract if the party seeking the decree can obtain a
sufficient remedy by a judgment for damages, and such a decree will not be made when
it would be impracticable to secure compliance with it.” Due to the fact that the
appellant had a life interest in the house, she could not pass any title to the respondent.
To support this argument, we were referred to the Latin maxim “nemo dat quod non
habet”, which means that no one can give that which he has not.

In the same vein, the case of Lindiwe Kate Chinyanta v Doreen Chiwele and
another29, emphasize the duty of an administrator in handling the estate of a deceased
person. In this case it was held that, “The duty of the administrator is not to inherit the
estate, but to collect the deceased's assets, distribute them to the beneficiaries and render
an account”

27
SCZ Judgment No.33 of 2000
28
(1977) ZR 336 (HC)
29
(2007) ZR 246
CONCLUSION

This case is outlines the procedure and requirement of selling estate belonging to the
deceased in accordance with the framework of espoused in the Intestate Succession Act.
By affirming the necessity of court authorization before the initiation of a sale
transaction, the Supreme Court has underlined the importance of judicial oversight in
matters dealing with the estate administration and property transactions. Additionally
this ruling serves to safeguard the rights of beneficiaries and ensure the integrity of
estate management processes. Moreover, the case sets a precedent for future disputes.
PHIRI V PHIRI AND ANOTHER HP 593 of 2013 [2014] ZMHC

ABSTRACT

The case of Phiri v Phiri and another is an important case where the decision clarified
the position of the law with regards to who is considered a dependent to the deceased
person. The decision in this case further reaffirms the stance of the law with regards to
the powers of joint or several administrators to the deceased estate.

This academic paper, gives an insight to the approach the High Court took in the
meaning or rather interpretation of the word defendant before the law of succession and
addresses the position of abuse of authority by the administrators in the performance of
their duties as majority administrators to the detriment of the applicant as a rightful
beneficiary. Furthermore, the applicants interest as a co-administrator being sidelined
by the other administrator.

The position of this article is that a dependent who is not a minor, is the person who
must show not only that was maintained by the deceased but also that he /she lived with
the deceased immediately prior to his or her death. Rendering continuance assistance
in lifetime of the deceased to any relative, does not place automatic obligation on one
after the death. Further in this case, the court was on firm ground to State that the local
court never gave any direction as to how the powers of the parties herein should be
exercised and the two administrators can or may legally take decisions as co-
administrator.

INTRODUCTION

A 2014 case of Phiri v Phiri and Another is the case brought before the High Court of
Zambia for determination by considering the provisions of the law governing intestate
succession. On originating summons the applicant is seeking a statement of account of
the deceased’s estate and an order that the deceased’s mother-in-law should not be
considered as a defendant entitled to a share of the deceased’s estate as it was deemed
by the respondents. Further, they considered the applicant please of specific accounts
in respect of her share of the deceased’s estate such as terminal benefits from Railway
Systems Limited, the house at Plot No. 580, Avondale, Lusaka, the farm in Mpika and
the motor vehicle identified as Toyota Prado Registration Number No. ABP 997.
FACTS

In July 2011, the applicant Rosemary Musa Phiri got married to Charles David Phiri
and never had children together till the death of Charles David Phiri on the 26th day of
February, 2013 without leaving a will. The local court on the 15th April, 2013, appointed
the 1st and 2nd respondent to co-administrator the late Charles Phiri’ s estate jointly with
the applicant who is the surviving spouse.

The order of appointment stipulations were that 55%, 25% and 20% of the deceased’s
estate should devolve among the three children, the applicant ‘surviving spouse’ and
the defendant respectively. The deceased mother in law to Charles Phiri from the late
wife who is looked after by her children and grandchildren was included as a dependent
to the deceased's estate by the two co-administrators herein referred as respondents.

The applicant asserted that she was being sidelined as a co-administrator and deprived
of what she ought to have rightly obtained from the deceased's estate.

The deceased's estate consists of a house at plot No 580, Avondale in Lusaka, three
room’s extension to the said house, a farm in Mpika, Toyota Prado registration No ABP
997, a chicken run, and the deceased's terminal benefits from Railway system of Zambia
and house goods. She also sought an order for the production of bank statements in
relation to a loan account, although she had not named the holder of the said account
nor the bank with which the account was held. HOLDING

The Respondents, jointly with the Applicant, to advertise twice in one of the daily
newspapers with wide circulation in Zambia requesting persons with any interest in the
estate of the deceased, Charles David Phiri, for information regarding any assets or
liabilities of the deceased that they may be aware of and thereafter to produce on oath
in Court the full inventory of the estate of the deceased clearly setting out all the assets
and any liabilities of the deceased within a period of ninety (90) days from the date of
the Judgment;

The Respondents to refrain from taking any further actions in the administration of the
estate of the deceased until the production of the inventory foretasted and subsequent
orders being made by the Court; Having found that the only beneficiaries of the
deceased’s estate are the Applicant, the two Respondents herein and the other child of
the deceased, the deceased’s mother-in-law shall not be considered as a dependent
entitled to a share of the deceased’s estate;

Furthermore, Subject to any debts or other liabilities, thirty-five per cent (35%) and
sixty-five per cent (65%) of the estate of the deceased to devolve upon the Applicant
and the three Children of the deceased, respectively. The Order of Appointment which
was made by the Local Court is hereby amended accordingly.

SIGNIFICANCE

This case gives more insight on who is considered as a dependent. A dependant herein
is defined as a person who was maintained and lived with the deceased person
immediately prior to his death as per section 3.30 A minor whose education need was
being provided by the deceased person and is incapable of wholly or partly maintaining
himself can be regarded as a dependent before the meaning of the law of intestate
succession.

The court was of the view that the mother in -law to the late Charles David Phiri was
not a beneficiary as the law pleases.

The high court considered the evidence that the mother in-law of the deceased from the
late wife was not living with him prior to his death and was maintained by her children
and grandchildren and the assistance she received like being built a house and rendered
material supported was not enough to qualify and place her in the position of a
dependent under the stance of the intestate succession.

In this case the High Court of Zambia considered the decision in the case of
Mwananshiku & Others v Kemp & Another,31 to arrive at a reasonable and desirable
conclusion where it was stated that rendering assistance to a relative does not place
automatic obligation on one after death. Considering the facts that she had children, this
could only mean that she was capable of maintaining herself with the help of the same
children who are deemed to be capable to support. The decision in this case helps to

30
The intestate succession Act chapter 63 of the Laws of Zambia section 3
31
[1991] 4 ZMSC 14
establish who is actually considered a dependent as defined in the intestate succession
Act of Zambia.

The court had the task to determine whether the steps which were taken by the
respondents in the administration of the deceased's estate were legally justifiable.

An administrator as defined in section 3,32 Is a person to whom a grant of letters of

administration has been made and includes the Administrator -General. It was found
that no evidence was presented as to whether the local court made any order of
appointment attached with directions as to how the respondents were to exercise their
powers and duties in the administration of the late Charles David Phiri's estate as it is
supposed to be when one is granted the letters of administration.

This case further brings out the stance of the law of intestate succession in Zambia in
situations where the beneficiary has properties of their own as to whether they are to
benefit from the estate. The applicant ‘surviving spouse' was denied the Toyota Prado
registration No ABP 997 on grounds that she already had two cars by herself before her
marriage to the late husband. The law however in this case is clear and defines the word
estate in section 3, as all the assets and liabilities of a deceased, including those accruing
to him by virtue of death or after his death and personal chattels. Because of this, the
applicant had the rights to be entitled to the car even with the fact that she already has
it because it is part of the estate.

It is cardinal to know that it is immaterial to consider whether a spouse contributed to

the acquiring of the property as the law in its sanctity state with only the exception to a
polygamous state as provide in section 5(1)33, where every surviving spouse ‘wives’ is
required to prove the level of contribution to the acquiring of estate and the duration of
their respective marriages to the deceased and other factors that can be qualifying as to
speak out the beneficial interest.

Furthermore, in this case, the position of the law with regards to how the estate shall
devolve when a certain class of beneficiary is not present was addressed. The provisions
are that the estate shall be distributed among the survived class. In this case the court

32
Ibid
33
The intestate succession Act chapter 63 of the laws of Zambia section 5(1)
considered the provision of Section 7(e)34, where only a spouse and children are
available, the portion of the estate which the parents and dependents would have
inherited shall be shared equally among the surviving spouse on the one hand and the
children on the other. It therefore stated that the 35% and 65% was to be received by
the applicant and children respectively because both classes of parents and dependents
were not available.

This case can be regarded as a cornerstone in understanding how the personal chattels
can be shared between the surviving spouse and children. Section 3 of the intestate
succession Act defines the personal chattels basically as all movable items or properties
with the exclusion of chattels used for business purposes, money or securities for
money.

The court in this case relied on section 8 of intestate succession Act which provides that
in a monogamous marriage the personal chattels are to be shared equally and absolutely
to the spouse and children as it was the case herein where the personal chattels of the
deceased's estate such as a DSTV, motor vehicle, furniture, carpet and the rest were to
be shared among the applicant and the children.

In addition, the case also can help to understand the position of the law with regards to
who is entitled to the house when both the children and the spouse are alive. In the case
section 935, provides that both the surviving spouse and children shall be entitled to the
house and they can decide together what to do with it what is reasonable and good for
them. However, the position of the law is that the surviving spouse has life interest in
the house which is determined upon the spouse's remarriage.

CONCLUSION

This case provides significant clarity on the definition of dependents under the Intestate
Succession Act Chapter 59 of the Laws of Zambia, highlighting the necessity for
evidence of dependency through prior living arrangements and support. It also
underlines the crucial requirement of court authorization for estate transactions,
defining the responsibilities of administrators in adhering to legal protocols. Moreover,
the judgment elucidates the equitable distribution of estate assets, including personal

34
The intestate succession Act chapter 63 of the laws of Zambia section 7(e)
35
The intestate succession Act chapter 63 of the laws of Zambia section 9
chattels and property, between surviving spouses and children. This case contributes
towards ensuring equitable outcomes in matters of inheritance and estate
administration.
BERNARD V JOSEPH [1982] CH 391

ABSTRACT

The decision of the court in the case of Bernard v Josephs is significant for its
recognition of beneficial ownership in unmarried couples, demonstrating the
application of equitable principles in property ownership. And so the beneficial
ownership of the house was held in equal shares subject to the discharge to the
mortgage, and account was to be given to the extra mortgage instalments paid by
Josephs. In the absence of any express declaration as to the beneficial interest, the Judge
had to look to see the respective contributions made towards the purchase price.

Beneficial ownership is a legal term that refers to the person who ultimately controls
and enjoys the benefits of a property, even if they are not the legal owner. In the case
of unmarried couples, beneficial ownership can be a contentious issue, particularly in
the event of break up. In general, beneficial ownership is determined by looking at the
property, who paid the mortgage, and who paid for any improvements made to the
property.

INTRODUCTION

This was an appeal to the court filed by Miss Bernard the plaintiff, against the
Defendant, Mr Josephs, Mr Josephs and his mistress jointly owned the house, the
unmarried couple bought a house in their joint names and on a joint mortgage which
each helped to service. It was held among other things, to the effect that the way in
which the couple lived in the house as if they were married and where there is evidence
that the parties had conducted their affairs in such a way that the court is satisfied, the
relationship was intended to involve the same degree of commitment as a marriage, the
share of the beneficial interest in the house to which each was entitled can be
ascertained according to the same principles applicable to a married couple.

FACTS

Bernard and Josephs purchased a house where they lived as man and wife, holding the
title to the property in joint names with no declaration of trust. Both parties worked and
they had joint responsibility for mortgage, Part of the property was let out to tenants.
Three years later,
the relationship brock down and Bernard left the house, Josephs remained in the
property, remarried, continued to let out parts of the house, and continued to pay
mortgage payments. Bernard claimed a half share of the house after the discharge of
the mortgage.

HOLDING

The court held that the beneficial ownership of the house was held in equal shares by
the parties. The judge assessed the shares in the house as half-and-half, and the court
gave credit to Mr. Josephs for the 2,000 he spent on improvements.

The court ordered that the property should be sold with vacant possession, and Mr.
Josephs was given four months to vacate the property or buy Miss Bernard’s share for
6,000. If he did not pay the money within four months, the house would then be sold
with vacant possession, and the proceeds distributed as directed by the judges. Lord
Griffiths LJ considered the principles which must apply in determining the property
rights of unmarried couples where he said that;

“The legal principles to be applied are the same whether the dispute is between married
or unmarried couples, but the nature of the relationship between the parties is a very
important factor when considering what inferences should be drawn from the way they
have conducted their affairs. There are many reasons why a man and a woman may
decide to live together without marrying, and one of them is that each values his
independence and does not wish to make the commitment of marriage, in such a case it
will be misleading to make the assumption and draw the same inferences from their
behavior as in the case of a married couple. They must look carefully at the nature of
the relationship, and only if satisfied that it was intended to involve the same degree of
commitment as marriage will it be legitimate to regard them as no different from a
married couple”.

SIGNIFCANCE

The case of Bernard v Josephs is significant for its recognition of beneficial ownership
in unmarried couples, demonstrating the application of equitable principles in property
ownership. It provides clarity on dividing property in the absence of formal agreements
or legislation for cohabiting couples, highlighting the flexibility of the legal framework
to adapt to evolving social norms. The judgment reinforces the courts’ role in enforcing
property rights and ensuring equitable outcomes, emphasizing fairness and justice in
property disputes

One crucial takeaway from this case is the significance of documenting intentions and
agreements, especially in joint property ownership scenarios. Without clear
declarations, courts rely on contributions and circumstances to determine equitable
shares, emphasizing the importance of clarity in legal arrangements.

In essence this case is an important case that addresses the complexities of property
ownership in cohabiting relationships and establishes principles for the equitable
division of assets in such circumstances. It construes the importance of fairness,
flexibility, and enforcement of property rights within the legal framework.

“It emerges clearly from the speeches in Pettitt v Pettitt36 and Gissing v Gissing37 that
it is the intention as to the beneficial ownership at the time the house Is bought that is
crucial and the contributions made by the parties to the acquisition are examined to
establish that intention.

CONCLUSION

Bernard v Josephs offers valuable insights into the complexities of property ownership
among unmarried couples, highlighting the need for clear legal principles to navigate
such situations effectively. The court’s decision, which favored equal shares based on
contribution assessments and equitable considerations, showcases a balanced approach
grounded in fairness and legal precedent.

Moreover, the court’s recognition of the distinction between cohabitation and marriage
underscores the nuanced nature of property rights, urging a case-by-case analysis rather
than blanket assumptions. This approach promotes fairness and individual
consideration, aligning with the evolving landscape of modern relationships.

The directive for a sale with vacant possession, coupled with a reasonable timeframe
for compliance, reflects the court’s practical approach to resolving disputes while
ensuring a just distribution of proceeds. This not only protects the interests of both
parties but also fosters legal certainty and efficiency in property matters.

36
[1970] AC 777
37
[1971] AC 886
DUGAN V. GOVERNOR H.M PRISON, FULL SUTTON [2004] 1 WLR 1010

ABSTRACT

The decision in the case of Dugan v. Governor H.M Prison38 is based in the certainty
of intention specifically highlighting that the courts will look at all circumstances of
this case.

This case looks at the decision of the court of appeal on the creation of a trust, focusing
on how the certainty of intention affects the validity of a trust. In this piece of writing,
we clarify on the necessities for a trust to be created with the certainty of intention.

The position or the main reason in this case is to make it clear on how the certainty of
intention can lead to the creation of a trust. Hence, the court of appeal ruled against the
appellant because he did not understand how a trust is created.

This piece of writing will further emphasize on how ownership can be transferred and
whether or not it was the Governor’s responsibility or legal obligation to invest the
money on behalf of prisoner’s money by virtue of section 43(3) of the prisons rules
of 1999.

Hence, will we will discuss whether intention can be deduced from the conduct or
words of a person as valid certainty of intention to create a trust. Furthermore, on how
intention is deduced from all circumstances surrounding the case and how section 43(3)
of the Prison Rules of 1999 did not reveal an intention of creating a trust, as stated in
the court of appeal.

INTRODUCTION

This is an appeal case from an order made on 28th February, 2003 brought by the
appellant. In this case, the issue was whether the effect of section 43(3) of the Prison
Rules of 1999, imposed a trust on the monies paid into an account under the control of
the Governor pursuant to the rule. The appeal was dismissed as there was no intention.

FACTS

The claimant was a prisoner serving a life sentence. He claimed that cash taken from
him when he arrived at the prison and money earned while in prison was held by the

38
[2004] 1 WLR 1010.
Prison Governor on trust for him in accordance with the prison rules and that the
Governor, as trustee, therefore had a duty to invest those monies. The relevant prison
rule which had to be construed by the court provides under section 43(3) of the Prison
Rules that;

‘any cash which a prisoner has at prison shall be paid into an account under the control
of the governor and the prisoner shall be credited with the amount in the books of the
prison’.

The claimant urged that the rule 43(3) of the prison rules, created a trust of the money
paid into an account under the control of the Governor. However, the judge found that
the purpose of the rule 43(3) of the prison rules was transferring possession and
ownership of the cash, to the Governor of the prison.

HOLDING

The Court of Appeal held that the rule did not reveal an intention to create a trust with
an accompanying duty on the part of the Governor to invest the ‘trust money’ but was
consistent with a banker/customer relationship and that it would have been impractical
to impose a trust relationship on the prison authorities.

On appeal judge did not find the argument persuasive, hence the court ultimately
dismissed the appeal. The judge used section 43, 44 and 47 of the prison rules and used
the case of Tito v. Waddel No.239 for he did not find it necessary to deal with the
argument of the respondent.

SIGNIFICANCE

To create a trust there has to be certainty of intention for it to be valid. To determine

whether or not the settlor had intention to create a trust, the courts look at the words or
conduct used by the settlor. In Paul v Constance40, it was found that even if the parties
did not use the word ‘trust’, he must nevertheless be held to have created a trust. In the
case the court construed from the words and conduct of the settlor that he had intention
for a trust to be created even though the word trust was not necessarily used.

39
(1997) CH.106
40
[1977] 1 WLR 527
The of Duggan v. Governor H.M prison is a case in which the court had to determine
whether there was an intention to create a trust by the appellant. In case the appellant
sought that a trust was created for his benefit with the governor being the trustee of the
monies he had deposited into an account under the control of the governor in
accordance with section 43(3) prison rules of 1999 that provides;

“Any cash which a prisoner has at a prison shall paid into an account under the control
of the governor and the prisoner shall be credited with the amounts in the books of the
prisons”.

The appellant believed the governor was the trustee of the monies put under his control
and that he was obliged to invest the money that the prisoner had deposited and upon
his release from prison he would receive the money with an interest.

The case of Paul v Constance41 highlighted that intention to create a trust can be
construed either through the words used or conduct of the settlor. However, in Duggan
v. Governor H.M prison the judge stated that nothing in the language used in section
43(3) of the prisons rules of 1999 and the circumstance in which money that was taken
from the prisoners upon their receipt imposed a trust on the governor. The main purpose
of section 43(3) of the prisons rules of 1999 was to deprive the possession of money
from the prisoners up their receipt.

The judge further stated that the language, ‘shall be paid into an account under the
control of the governor’ provided in section 43(3) of the prisons rules of 1999 was
administrative in nature. This meant that the money that was paid into one single
account and under the control of the governor was more administratively workable in
nature as compared to the governor opening separate accounts for each prisoner upon
his receipt in his own name. In addition, the requirement that ‘the prisoner shall be
credited with the amounts in the books of the prisons’ provided under the same section
points out that the relationship of that being that of a banker/customer rather than that
of a trustee/beneficiary.

Furthermore, since the appellant argued that the trust was created. The relevant question
is whether the circumstances under which the money were taken from the prisoner in
accordance with section 43(3) of the prisons rules of 1999 where such as to impose a

41
Ibid.
trust on the governor. Section 43(3) of the prisons rules of 1999 did not intend to
deprive the prisoner of an existing equitable interest to his money as the legal title as
there was no existing equitable interest to begin with as the legal title carried with it all
rights of ownership immediately the money was transferred into the prisons account.
The appellant also acknowledged that the money that was take from him did not only
transfer legal ownership to the governor but it carried both legal and equitable
ownership to him. Further, the money that was held in the prison account was not
confined to the money that was in his position at the time of his receipt but also included
money brought by visitors or cash that was sent to him through post in accordance with
section 44(2) of the prisons rules of 1999 that provides that money should not come
into the position of the prisoners.

The defendant who was the governor argued that he was merely performing his
obligation as stipulated under section 43(3) of the prisons rules of 1999 which was to
collect and keep the money and not to invest by virtue of being a trustee. Furthermore,
section 43(5) of the prisons rules of 1999 allowed the governor to confiscated articles
found in the possession of prisoners.

Hence the courts held that there was no intention to create a trust because it was merely
an obligation for the governor to keep money for the prisoners. The reason to it is how
impractical it would be if all the monies collected from the prisoners was to be held
under a trust. It also highlighted the nature of a trust as that where the beneficiary is the
equitable owner and trustee as the legal owner as seen in the case of Kambindima
Wotela vs Standard Chartered Bank Zambia Plc42 for it to be a valid trust. However,
in this case the relationship was that more of a banker/customer rather than that of a
trustee and a beneficiary. Therefore, there was no trust created by virtue that the
governor had both the legal and equitable interest.

CONCLUSION

In conclusion, the court dismissed the appeal as a result of the absence of the certainty
of intention and failure to understand how a trust can be created.

42
(2012/HP/1 38)
The importance of this case is that it talks about how the certainty of intention affects
the validity of a trust either through words or conduct and under which surrounding
circumstances does the courts consider the trust to be valid.
WESTDEUTSCHE LANDESBANK GIROZENTRALE V. ISLINGTON
LONDON BOROUGH COUNCIL [1996] A.C. 669
ABSTRACT
The decision in Westdeutsche Landsbank v Islington43 is fundamental because it sets
out a clear view on constructive and resulting trusts. The decision of this case supports
the concept that a resulting trust cannot be imposed without considering the other
party's conscience and their claim of unrealized property rights.

This article examines the strategy the court used to establish a resultant trust.
Additionally, it will make clear any uncertainty regarding the appropriate course of
action for the appellant to obtain the money.
This essay takes the stance that constructive trusts arise naturally through the
application of the law rather than being created specifically. In this case, Lord Browne-
Wilkinson described a constructive trust as one the law imposes on the trustee by reason
of his unconscionable conduct44.
INTRODUCTION
This is an appeal case in which the appellant argues that the money it paid to Islington
under the contract is held by the defendant under a resulting trust. The deal was ultra
vires and void ab initio, therefore Westdeustsche Landsbank could only reclaim its
money with simple interest. All following trusts, according to the House of Lords, were
not governed by unjust enrichment laws and instead relied on reason.

FACTS
In this case, a lawsuit was filed against Islington LBC, the Westdeutsche Landesbank
Girozentrale demanded the restitution of £1,145,525 which included compound interest
that it had paid as part of an interest rate swap deal with the council. The council
acknowledged that it was merely required to pay back simple interest on the money it
had received under the null and void contract. Therefore, Westdeutsche contended that
the bank clearly had no intention of making a gift and that as soon as the money was
sent over, a consequent trust emerged. Among other things, the bank's attorney argued
that since the original contract's foundation had collapsed, a resulting trust was created
on all grounds of unjust enrichment. The council argued that, according to conventional
trust law principles, there could be no compound interest or property right as a result of

43
[1996] A.C. 669.
44
Judith Riches Optimize Equity and Trusts 2nd Edition Routledge
the contract being void because the council's conscience could not be influenced when
he was unaware.

Although it did not work out that way, the bank had meant for the money to flow under
a lawful swap arrangement, therefore there was no presumed intention of the parties
that the money be kept on trust as a resulting trust. As a result, compound interest could
only start to accrue after the council's conscience was impacted.

HOLDING

The House of Lords held that, Westdeustche Landsbank only had a personal right for
recovery in a common law action of money and no proprietary equitable claim under a
resultant trust, the House of Lords concluded that Westduetsche Landsbank could only
recover its money with simple interest. Because the Council's conscience had to be
impacted upon receiving the money due to the awareness that the transaction had been
ultra vires and void, there could not have been a resulting trust. Despite the requirement
that there be an intention to hold the money in trust, this was not feasible because, up
to the House of Lords' ruling in Hazell v. Hammersmith and Fulham45 , no one was
aware that the transaction would turn out to be null and void.

All resulting trusts, according to the Court, were dependent only on intent and had
nothing to do with the unjust enrichment statute. As a result, there could be no trust as
the transaction was ultra vires and thus void ab initio, making it impossible to have such
an intention. Since there was only a personal claim to the money, compound interest
was not payable, only simple interest was.
SIGNIFICANCE

Given how much of the law in this field is based on the House of Lord’s ruling in
Westdeutsche Landesbank v. Islington46, a synopsis of that case would be helpful at
this early stage. The facts of the case provided an ideal setting for the discussion that at
the time was central to trusts law. The problem was this, how could Westdeutsche
Landesbank get its money back from Islington after it paid money under a contract, that
was null and void without their knowledge. It was decided that Islington's conscience
had not been impacted because he was unaware that the contract was null and void prior

45
[1992] 2 AC 1
46
Ibid.
to all of the money being spent. Because a trust will only come into existence once the
legal owner’s conscience is affected, there was no trust (whether constructive or
resulting) over the money before it was spent.

Before in Sempra Metals Ltd v. IRC47, awards of compound interest could only be
granted by the courts if the claimant could demonstrate a property right.

Since it was a personal action, if Islington had become bankrupt in the meantime, then
Westdeutsche Landesbank would only have had a personal claim against a person who
was bankrupt and would have had nothing in practice, fortunately Islington remained
solvent. In reading the case, it is clear that the only question left for the House of Lords
was to decide whether Westdeutsche Landesbank was entitled to compound interest on
its money or only to simple interest. The majority of the House of Lords held that
compound interest could only be paid by the bank if it had some ownership interest in
the money under the terms of the law in effect at the time.

The House of Lords dismissed the argument. The argument's issue is that it fails to take
into consideration how unfair it would be to grant the payer a property right in money
that would give it an advantage over the payee's uninsured creditors. Furthermore, a
resulting trust would not be able to respond to the inquiry, if the funds had already been
spent. What the House of Lords majority accomplished was to restore our
understanding of equity as being grounded in conscience.

The fundamental principles of the trust will become apparent when good conscience so
dictates, the lawful owner of property will be required to hold it in trust for any person
who is beneficially entitled to it. This obligation can arise from a clear statement of
trust or from the courts imposing an implied trust48.
CONCLUSION

According to the ruling in Westdeutsche Landesbank v Islington49, the house of

Lords, compound interest may only be paid if the bank was entitled to ownership
interest in the funds under the applicable legislation at the time. The argument was
rejected by the majority of the House of Lords, who claimed that it neglected the unjust
consequences of giving the payer a property right in money and that if money had

47
[2007] UKHL 34
48
Alastair Hudson Equity and Trusts 6th Edition
49
ibid
already been spent, the resulting trust would not be able to answer to the question. Our
understanding of equity as based on conscience has been established by this instance.
HUSSY V PALMER [1972] 1 WLR 1286 COURT OF APPEAL

ABSTRACT

The decision in the case of hussy v palmer is a land mark case because it stipulates how
a constructive trust may be determined. The case decision set that no resulting trust
arose because money wasn’t given as a gift nor a loan by the claimant to the defendant.
Lord Denning considered that if a resulting trust had not arisen, a constructive trust
would exist instead. It is stated to say by whatever name a constructive trust is
described, it is a trust imposed by law whenever justice and good conscious require it.
Hence the courts regard this kind of trust as a remedy which would only be available
where a defendant knowingly retains property of which the plaintiff has been unjustly
deprived and in deciding whether or not to create or impose a trust over the property,
the courts would tailor the trust to the circumstances of the individual case, so that
innocent third parties would not be prejudiced.

A Constructive trust is crucial in law to prevent unfair enrichment and ensure equitable
distribution of property rights. It arises when someone holds property for the benefit of
another, rectifying situations where retention would be

INTRODUCTION

This was an appeal of the English trusts law, held in the court of appeals. It concerned
the equitable remedy of constructive trusts as the plaintiff alleged that there was a
resulting trust formed due to the fact that she was the mother-in-law to the defendant,
it also invoked the equitable maxim "Equity regards the form and not the substance ".
The high court held that no resulting trust was formed as the money wasn’t given as a
loan nor as a gift. On the other hand, the court of appeal had set aside the decisions of
the lower courts, in dealing with this mater as the plaintiff had filled different law suits.

FACTS

Mrs. Hussey was an elderly widow and pensioner, in 1967 she had a little house which
was in a very dilapidated condition. She sold it for the sum of £l,100. She had a daughter
who was married to a Mr Palmer, Mr. and Mrs. Palmer who lived at No. 9 Stanley
Road, Wokingham, which belonged to Mr Palmer. When the mother sold her little
house, the young couple invited her to go and live with them, but there was not much
room for them all. So they built on a bedroom as an extension for the old lady. Mrs.
Hussey paid £607 for the building, she paid it direct to the builder Mr. May. Nobody
said anything about repayment, no doubt they all thought that the old lady would go
and live there, using the bedroom, for the rest of her days. For a few months all went
well. The old lady used to make payments to the daughter if she was short of money.
But then differences arose, after about fifteen months they could not live in harmony
any more in the house. So in March 1968, Mrs. Hussey went and lived elsewhere,
leaving the Palmers there in their house. After a year or so, Mrs. Hussey wrote to her
son-in-law and said she was very hard up. She asked if he could manage £1 or 30/- a
week to help her out. He did not do it. He did not even reply. So she asked for the money
back, the £607 which she had paid for the extension, they did not pay. And so she got
legal aid in April 1970, she took out a default summons in the County Court against
Mr. Palmer. She claimed £607 for money lent. Mr. Palmer wrote a Defense in his own
handwriting. He said;

"The payments, made to the builder, were not a loan, but were paid by the plaintiff for
her own benefit and at the time the question of repayment was not raised. I assumed
that the payments were in effect a gift".

Later on, Mr Palmer got legal aid too and with the help of legal advisers, he put in an
amended defence in which he denied liability. He said that "the moneys were only to
be repaid in the event of the defendant’s house No 9 Stanley Road in Wokingham, being
sold within a short period of time, building works having been completed by the said
Mr May. The said building works were mainly in respect of an extension to the said
house, which extension was for occupation by the plaintiff. He also said that "the said
agreement was merely a family arrangement and was not intended to have legal
consequences."

HOLDING

In the first judgement, when the case was brought before the court, the judge was fully
occupied. So the case was held by the registrar by consent, but that it was a family
arrangement. Mrs Hussey's advisers were so impressed that they submitted to a non-
suit and started a fresh action. This time they issued a plaint claiming the money on a
resulting trust. They said that, as she had contributed this £607 towards the extension
of the building, at all events Mr Palmer held the house on trust to repay it at some time
or other to her: and that she would have an interest in the house to that extent in
proportion to the amount she had contributed.

The Court imposed or imputed a trust by which Mr Palmer is to hold the property on
terms, under the circumstances that had happened, she has an interest in the property
proportionate to the £607 which she put into it. She is quite content if he repays her the
£607, If he does not repay the £607, she can apply for an Order for sale, so that the sum
can be paid to her. But the simplest way for him would be to raise the £607 on mortgage
and pay it to her.

The court further held that since the money wasn’t presented as a gift by the claimant
and since the parties never made any arrangements for the money to be repaid, and
neither was it a loan, the presumption of resulting trust therefore arose. Given that the
son-in-law used the money to improve his property, it would be unconscionable for him
to retain that benefit without repaying his mother. And so he held his house on resulting
trust for himself and the claimant. The claimant possessed a share proportionate to the
607 pounds she had paid.

SIGNIFICANCE

This case highlights the difference between a constructive trust and a resulting trust
which is the intention of the parties involved. The authors of Principles of equity and
trust50 define a resulting trust as; a trust which arises in circumstances where an express
trust fails, thus a resulting trust is created when one party intends to make a gift to
another, but there is no intention to create a trust. On the other hand, a constructive trust
is created when the law implies a trust in order to prevent unjust enrichment. So a
resulting trust is based on the intention of the parties and a constructive trust is based
on preventing unjust enrichment.

The decision of the court was based on the intention of the parties, rather than the legal
form of the transaction and focused on the importance of equitable principles. And
based on the principle Lord Denning construed a constructive as a remedial. With
regards to the principles, this case is important as it establishes principles that ensures

50
Samantha Hepburn, principles of equity and trusts, (2 nd edition)
6
that property is held for the benefit of the beneficiary. It also provides a remedy in
situations where a party gains property through fraud or by breach of fiduciary duties.

CONCLUSION

The decision made in Hussey v palmer is a very important decision because it helps to
address issues pertaining a constructive and resulting trusts. Given that a resulting trust
is one that is formed when an express trust fails while constructive trust is a remedy
that the law comes up with, to restitute and uphold equitable principles.
LISTER V STUBBSL [1890] 45 CH D 1

ABSTRACT

The case of Lister and Co v Stubbs 51is an important case in the law of trusts as it had
given counsel to people engaging in constructive trusts the extent to which the Principal
can claim for the properties that are placed on trust. The decision in Lister and Co v
Stubbs establishing a legal principal regarding the treatment of profits obtained by the
trustee who is the employee and the decision had clarified that it would not be suitable
to treat the secret profits as property.

This article aims at highlighting the decision made by the court of appeal which had
looked at the question rising of whether the secret profits made by the trustee will be
treated as the settlor’s property which would give an example to which so ever trustees
would be in the ownership of such a trust.

The Stand taken in this article is that the profits that are made by an employee who is
on constructive trust will not be termed as property even though being trustee as the
money was not received by the trustee from the settlor but rather a third party. The case
was decided to not allow the settlor to claim the secret profits as property but rather
emphasized that the secret profit made would be taken as debt owed to the plaintiff as
it was conducted through corrupt practices.

INTRODUCTION

This was a case that had been brought to the court of appeal that had a question rising
whether the court would consider the secret profits made as property to the employers
of the trustee. The court maintained that while Stubbs was liable to account for the
profits made in the course of his employment, this did not automatically make the funds
Lister & Co’s property. This meant that the property would not be taken by the
placement of the injunction but rather was treated as debt owed by the employee to the
employer because of the corrupt method of the obtaining of the money.

51
Lister & Co v Stubbs [1890] 45 Ch D 1
FACTS

The two parties had an employee an employer relationship. Lister and Co was a
company that dealt with silk-spinning and drying and was also a manufacturing
company, the defendant Stubbs being an employee of the company being a dyer. Stubbs
was entrusted with purchasing materials for the company and, unbeknownst to Lister
& Co, received significant commissions from Varley & Co, a supplier. Between
September 1881 and March 1890, Stubbs received £5541 5s. 1d in commissions, which
he partially invested in real estate and other ventures.

Upon discovering these secret profits, Lister & Co sought to recover the funds, claiming
that the money paid to Stubbs rightfully belonged to them. They moved for an
interlocutory injunction to restrain Stubbs from dealing with the invested real estate and
for an order directing him to bring the other investments and cash into court.

HOLDING

The judgement by the court of appeal had been delivered by Stirling J and the ruling
was made against the plaintiffs Lister and Co.

The Court held that the relationship between Stubbs and lister and Co was that of Debtor
and Creditor, and not trustee and Cestui que trust, therefore the plaintiffs were not
entitled to the order they sought. The court concluded that the secret profits received by
Stubbs could not be treated as the property of Lister and Co until a judgement or decree
established such a claim. The court also rejected the notion that Stubbs was under an
obligation to provide security for the alleged debt until it was established by judgement
or decree.

SIGNIFICANCE

The Case of Lister and Co v Stubbs had set out a precedent to cases that would involve
employees who would make secret profits, from the situation the court had answered
the questions which arose whether the defendant Stubbs would keep the money and the
plaintiff being entitled to the amount or the plaintiff would claim the bribe held on
constructive trust and the bribe would be traced to the property purchased and claim the
shares worth the 5000 which had been taken. This was an issue for a century but the
court had settled the decision through the ruling given.

The court’s Reasoning in this case was also that since the funds came from a third party
as a result of a corrupt bargain and not from Lister and Co, they were not considered to
be held for trust by Lister and Co. This reasoning was also taken from the cases of
Morison V Thompson 52 where lord Cockburn CJ had established that while an agent
is bound to account to their principle or employer during their course of employment
or service, there is also a legal duty to hand over the property to the principle upon
receiving it.53

CONCLUSION

The decision in this case is of mere importance to the law of trusts as it had answered
the question riding from the scenario where secret profits made by the trustee and the
step to be made, the article is in support that the decision in the case is concerned more
on the policy of implication of a proprietary remedy and sets a stand that the principal
has no right to the bribes money and secret commissions obtained by the agent.

52
MORISON V THOMPSON (1874) LR 9 QBD 480
KEECH V SANDFORD (1726) SEL CAS KING 61

ABSTRACT

The decision in Keech v Sandford 54had given precedent to issues arising on the breach
of a fiduciary duty involving the making of an unauthorised profit by the trustee which
had led to a conflict in interests between the trustee and beneficiary, it had further on
provided a scenario in which the breach of fiduciary duty was illustrated and therefore
establishing a modern rule that no profit can be made from a trust.

This piece of writing outlines the steps that were taken in the deciding of the case by
the court and setting out the principles laid down by the case, it also seeks to look at a
bigger picture to the case of keech v Sandford.

The position in this article is that the fiduciary duty being the duty owed by the trustee
to the trust was breached in that the trustee owed a duty to the beneficiary being an
infant who grew and made action against the trustee being justifiable as the trustee had
indeed breached the trust through not complying by his fiduciary duties.

INTRODUCTION

This was a case brought to the Essxchequer which had decided whether the making of
profits from the lease of profits of the market which needed to be renewed for the benefit
of the infant. The court had discovered that the profit made by the trustee was as a result
of the settlor’s action of refusal, the question raised was whether this could still amount
to an unauthorized profit.

FACTS

The settlor declared a trust of his estate for an infant (the claimant). The estate included
a lease over the profits of Romford Market in London. The trustee applied on behalf of
the infant to renew the lease shortly before it expired. The settlor refused to grant the
infant a new lease, but offered a lease directly to the trustee. The trustee accepted. When
the claimant became an adult, he sued the trustee for the profit obtained from the lease.
55

54
Keech v Sandford [1726] Sel.Cas. Ch 61 C
55
Keech v Sandford – Case Summary – IPSA LOQUITUR
HOLDING

The ruling being made against the claimant had established that the trustee must have
let the lease run out rather than take for himself. By taking the lease the trustee breached
his duty to the beneficiary, consequently the trustee was required to account for the
breach made through profits from the lease.

SIGNIFICANCE

The case had highlighted the rule and set out precedent for the rule of the fiduciary
duties of trustees which is the duty to not make an unauthorized profit, the case here
had the trustee going against the duty and had led to the conflicting of ownership which
went against the principle of duality of ownership where the beneficiary is the beneficial
owner and the trustee being the legal owner. This was stated in Kambindima Wotela
vs Standard Chartered Bank Zambia Plc56, where the nature of a trust relationship
was highlighted with the court stating that- "A trustee is the nominal owner of the
property, while the cestui que trust is the beneficial owner of the property."

This conflicting of interest is created in the breach of the fiduciary duty of an

unauthorized profit. Another case which had illustrated the principle is the case of
Protheroe v Protheroe 57 where The husband (as legal owner) held the leasehold on
trust jointly with his wife, and the Court of Appeal held that the husband, being in the
position of trustee, could not claim to be wholly entitled to the difference between the
value of the house as a leasehold and as a freehold, although he would be reimbursed
for any payment he had made for the freehold.58

CONCLUSION

The decision by the Court of Exchequer is justified as it had set out precedent as shown
in Protheroe v Protheroe about how the breach of the fiduciary duty leaves the trustee
liable to the beneficiary who by law has the legal right to ask for an account to be given.
The article stands with the decision of the court as it prov

56
Kambindima Wotela vs Standard Chartered Bank Zambia Plc(2012/HP/1 38)
57
Protheroe v Protheroe [1968] 1 WLR 519
58
Optimize Equity and Trusts Second Edition Judith Riches
ATTORNEY GENERAL FOR HONG KONG VS REID (1994) 1 AC 324

ABSTRACT

Attorney General for Hong Kong v Reid marks a seminal case that delves into the
intricate realm of constructive trusts and fiduciary relationships. This abstract
encapsulates the foundational principles arising from the case, explaining the court's
insights into these crucial aspects of equitable jurisprudence. The case revolved around
allegations of corruption and misconduct by a senior public official, Reid, in the pre-
handover era of Hong Kong.The court's analysis of the fiduciary relationship between
public officials and the state unraveled several key principles:

Fiduciary Duty in Public Office: A central tenet of the case was the recognition of a
fiduciary relationship between public officials and the state. The court held that
individuals in positions of public trust owe a fiduciary duty to act in the best interests
of the public and the state, the conduct expected from public officials, emphasizing the
need for loyalty, honesty, and avoidance of conflicts of interest. Constructive Trusts
as a Remedial Mechanism: The judgment clarified the application of constructive
trusts as a remedial mechanism in cases of breach of fiduciary duty, when a fiduciary,
such as a public official, breaches their duty and gains an unauthorized benefit, a
constructive trust can be imposed to restore the misappropriated property to its rightful
owner. This principle reinforced the court's commitment to equitable remedies in
addressing breaches of fiduciary obligations. Accountability and Public Confidence:
Attorney General for Hong Kong v Reid underscored the importance of accountability
in maintaining public confidence in governmental institutions. The court held that
public officials must be accountable for their actions and be held to the highest
standards of integrity. The imposition of constructive trusts served not only as a remedy
for the specific case but also as a deterrent to ensure the probity of public officials.

INTRODUCTION

Mr Reid was a New Zealand citizen who was employed as a Hong Kong Deputy
Crown Prosecutor and then acting director of Public Prosecutions, so in a fiduciary
relationship with the Hong Kong government. He took bribes to obstruct prosecution
of some criminals, and used the money to buy land in New Zealand. Some was kept by
Mr Reid and his wife, Mrs Judith Margaret Reid, some conveyed to Reid's solicitor.
The Hong Kong government argued the land was held on trust for them.

FACTS

The first respondent Mr. Reid, a solicitor and New Zealand national, joined the legal
service of the Government of Hong Kong and became Crown Counsel, Deputy Crown
Prosecutor. The first respondent, in breach of the fiduciary duty which he owed as a
servant of the Crown, accepted bribes as an inducement to him to exploit his official
position by obstructing the prosecution of certain criminals. Mr. Reid was arrested,
pleaded guilty to offences under the Prevention of Bribery Ordinance and was
sentenced on 6,July,1990 to 8 years imprisonment and ordered to pay the Crown the
sum of HK$12.4m, equal to NZ$2.5m., being the value of assets then controlled by
the first respondent which could only have been derived from bribes. No part of the
sum of HK$12.4m has been paid by the first respondent. Among the first respondent's
assets are 3 freehold properties in New Zealand.

HOLDING

The Privy Council advised the bribe money received by Reid, and the land acquired
after, was held on constructive trust for the Hong Kong government. If the property was
badly invested. He was arrested, pleaded guilty to offences under the Prevention of
Bribery Ordinance and was sentenced on July 6, 1990, to eight years' imprisonment and
ordered to pay the Crown HK$12.4 million, equal to NZ$2.5 million, being the value
of assets then controlled by him which could only have been derived from bribes. No
part of that sum had been paid.

SIGNIFICANCE

The court noted that a bribe accepted by a fiduciary is an inducement to betray trust,
and any benefit or property obtained from the bribe belongs to the fiduciary in law but
is held on constructive trust for the person to whom the duty was owed in equity. This
approach aligns with the principle that equity acts in personam and insists on
the unconscionability of a fiduciary benefiting from a breach of duty. If the property’s
value changed, the fiduciary remained accountable for either the shortfall or the surplus,
ensuring that no profit was derived from the breach of duty. The court found that if a
trustee invests trust money in breach of trust and holds the investment as trust property,
then similarly, a trustee who invests a bribe in breach of trust should also hold those
investments as trust property.

CONCLUSION

The case Attorney General of Hong Kong v Reid affirmed that bribes accepted by a
fiduciary in breach of duty are held on constructive trust for the person to whom the
duty is owed. This principle upholds the fundamental tenet of equity that fiduciaries
must not profit from their breach of duty. This ruling plays a vital role in ensuring that
fiduciaries cannot benefit from their wrongful acts and reinforces the integrity of
fiduciary relationships, particularly in the context of corruption and bribery.
BOARDER MAN VS PHIPPS (1967) 2 AC 46

ABSTRACT

The verdict of the court in the case of Boarderman v Phillps is an important case that
emphasizes and clarifies one of the fiducial duties of fiduciaries of a trust and how
actions done with personal interest in mind and enjoyed by people who are not the
beneficiaries of the can be consider to be a breach and therefore whatsoever is acquired
from any transaction relating to this issues will be held on a constructive trust on behalf
of the beneficiaries.

This piece of writing is aiming at the critically bringing a clear understanding on the
remuneration that is to be paid to trustee performing duties using their professional
skills as compared to a normal trustee performing duties without any professional
skills.it also bring a clear understanding decision of the court in issues relating to
fiduciaries who have conflicts in interest in relation to a trust and how whatever is
obtained as result of those actions can be handled so as to benefit the beneficiaries as
per the sole principle of a trust that beneficiaries should benefit from the trust that has
been created for them.

INTRODUCTION

This is a case that brought arguments on whether fiduciaries by virtue of how much
work has been invested to make profit using trust properties gives them the entitlement
to take part in benefitting from what is obtained from the transactions resulting from
the trust and the court decided to clear this misunderstanding and provide a solution
that best serves the beneficiaries of the trust.

Boardman was solicitors to a fixed family trust of the Philipps family. He was consulted
by the trustees of the trust on what could be done when it came to issues of the trust
properties which were shares in a textile private company which was been ineffectively
managed and was he therefore became concerned with the financial state of the
company. Boardman together with one of the beneficiaries Tom Philips attended a
shareholder general meeting of the company and came up with an idea of how best he
could help improve and protect the trust’s interest. He realized that he could boost the
company with his skills but that was only going to be possible if he had major shares
in the company as this would give him more influence needed to perform the tasks that
would improve the company that was not in very good faith. He suggested the idea to
a trustee Mr Fox who had dismissed the idea of trustees been involved in such purchases
off but Boardman continued with his plan and out of good faith he invested in the
company using his own resources by buying more shares for the trust, he now had
enough shares putting together the shares of the trust as well as the newly bought shares
and this was done without the consent

of all the beneficiaries. He succeeded in improving the running of the company and
brought the company back to its fit and it was now able to make a lot of profit. The
profit that had been attained from a successful business transaction where therefore
shared according to all share holders which where the beneficiaries of the trust by virtue
of their shares, other company shareholders as well as Mr Boardman himself. John
Phillip sued Boardman for the personal unauthorized profit as held in the case of
KEECH v STANDFORD that he made and demanded that Boardman should provide
account for the profits all the profit including the profit Mr Boardman was to take for
himself was given to the trust and regarded as benefits for the trust which is to be
enjoyed soley by the beneficiaries. The court heard Tom’s argument and granted hos
request. Mr Boardman appealed so as to obtain redress to the decision of the court as
he felt it was unfair on his part.

HOLDING

Appeal was dismissed. The defendants were liable to account for the shares and profits
to the trust beneficiaries but liberal allowance was maintained. They appealed to the
house of lordswhere lord Hodson stated that “ a fiduciary shall not profit from his
position without proper consent from the beneficaries”

SIGNIFICANCE

The key principles of this case is that firstly, trustees are entitled to remuneration which
is provided for in a trust instrument under remuneration clause when they are
performing their duties as a professional with their well trained skills like the way Mr
Boardman was carrying out his duties as a solicitor.

Another principles is that a fiduciary has a duty to invest, improve and protect the
interest of a trust property, these duties are voluntary in nature, any finances obtained
through the advantage of of this position shall be held on trust and should be exercised
good faith while bearing in mind that all actions taken should be done all how much
work they have invested or that they can together with the benficairies benfit from the
interests that are as a result of a trust. This case underscores the role of informal consent
in mitigating the consequences of fiducial breaches especially when beneficiaries are
advised and make decisions with full knowledge of relevant circumstances and also
fiduciaries must disclose all conflicts in interest regarding the trust property.

CONCLUSION

The judgement for this case is important as it outlines the provision of remuneration
clause that is meant to pay trustees that are working as professionals like a lawyer or an
accountant. It also outlines how the court continues to promote equity in their
judgement in cases where there is conflict in interest and a trustee uses their personal
resources to fund the trust for it to produce more profit. This judgement ensures that the
trustee and the beneficiaries benefit accordingly.
CAROLINE LWANDO NKWABILO MAIGA V MAIGA TEMIMU SCZ
APPEAL NO 160/ 2012

ABSTRACT

The decision in the case of Caroline Lwando Nkwabilo Maiga v Maiga Temimu is
essential in that the law that complies with trusts in relation to the welfare of the
beneficiaries as well as the individuals that act on their behalf until they can be of age
to take full ownership. The ruled judgment makes for it, as it would be regarded as
inequitable for the trust to be considered unjustly ordered without putting into account
the intrinsic worth of this case.

This commentary is concerned with whether or not the ruling of the lower court
validates that a trust can be formulated and be vested in a non-beneficiary in the waiting
of the actual beneficiaries attaining the age of majority. And this individual is one who
does not primarily fall under the general scope of full citizen. It clearly brings out the
position of the law with regards to an individual whose not Zambian owning land in
Zambia as per section three of the lands act. The decision in this case shows whether or
not it is fair for the other spouse to benefit from the property acquired while in marriage
and the other to hold the properties placed under a trust for a specific duration not until
the youngest child is 18 years.

The bearing of this article, stand upon the fact that a trust can indeed be given to a
trustee to hold on behalf of the beneficiaries especially if they have not yet attained the
age of majority. It also looks upon the provident fact that one, who is considered non
Zambian, can confer ownership of land if it’s subjected to their agent by virtue of the
deputy Registrar or any competent court

The position of this piece of writing fulfilled a trust can be created without intentions
but by the courts decisions as they deem it fit for the best interest of the minors. The
case also shows us the decision of the high court that was further ruled in accordance
with the Supreme Court.

INTRODUCTION

The appellant lodged this appeal on the basis of their dissatisfaction with the ruling
rendered by the lower court, alleging that the beneficial interest was vested in the
respondent instead of the designated beneficiaries. The respondent, acting as the
petitioner, sought an interpretation of the decision from the district registrar, who had
delegated the property in accordance with Sec 24(1) (c) (d) of the Matrimonial Causes
Act59, a request that was granted by the panel of judges. Consequently, the Supreme
Court proceeded to examine the grounds for appeal, focusing on the certainty of the
dispute rather than the mere technicalities.

FACTS

The appeal arises from a divorce petition and an order for custody of children, which
was granted by the high courts on the 11th of July, 2002. Due to disputes arising from
the distribution of property in Subdivision 299 of Farm No. 441a Roma, Lusaka, the
said property was partitioned into two parts. Sub B encompasses the matrimonial home,
while Sub A is a standalone house that was leased to tenants. The division was made to
address the conflicts surrounding the property sharing.

When the issue was first brought before the courts, the district registrar intervened to
adjudicate the property settlement disagreements. On the 21st of February, 2003, the
registrar rendered a decision stating that although both parties had legal standing, the
respondent also possessed an equitable interest. This led to the ultimate conclusion, and
I quote “the property referred to as Subdivision A of Subdivision 299 of Farm 441a
Roma Township, Lusaka shall continue to vest in the respondent while the remaining
extent otherwise known as Subdivision B of Subdivision 299 of Farm 441a Roma
Township, Lusaka shall be transferred to the petitioner or his duly authorized agents
who shall possess and hold it in trust for the three children until the youngest of the
three shall have attained the age of 18years.”

This order was construed in line with the provisions of the Matrimonial Causes Act60
and would be required to take effect immediately.

In light of the respondent's discontent, an appeal was filed for the purpose of seeking
interpretation. The initial request was dismissed by the High Court but subsequently
granted by a panel of Judges who concurred that there existed a certain degree of
ambiguity in the previous ruling. This ambiguity established that the respondent holds

59
Matrimonial Causes Act of 1973
60
Sec 24 (1) (c) and (d) of the Matrimonial Causes Act of 1973
both the beneficial interest and possession of the property in Sub B of Sub 299, Farm
441a Roma Township, Lusaka, for the benefit of the couple's children.

HOLDING

The main concern is that the issue is not as broad as the petitioner initially presented it.
It is clear that the property in question, Sub B of Sub 299 of farm 441a Roma Township,
Lusaka, was held in trust for the children without any conflicting facts. Another
undeniable fact is that the respondent was only holding the trust until the youngest child
reached the designated age of 18.

The order issued by the Deputy Registrar on April 21, 2012, was deemed to be
ambiguous, but it was agreed that it was solely for the benefit of the children and the
respondent was not allowed to interfere with the property in a way that would
disadvantage the beneficiaries.

From this perspective, we can observe that the trust originated from a property
settlement order, which distinguishes it from the cases of Re the trusts of the Abbott
Fund61, Re Andrew's Trust62, or Re Osoba63, which dealt with absolute gifts rather
than the construction of resulting trusts, which is not relevant to the current matter.

It was concluded that the appellant understood the district registrar's order, and
therefore, it was determined that there was no property settlement argued by the
respondent, but rather a distribution of property between the appellant and the children.

The appellant also argued that, according to Section 3 of the Lands Act Chapter 184 of
the laws of Zambia, the respondent, being a non-Zambian with Malian background, was
not allowed to own land. However, the court ruled that the appellant should have been
aware of this and should have raised this issue earlier as a former spouse. Regarding
the argument, Section 3 (i) of the Lands Act allows for the alienation of land by non-
Zambians.

SIGNIFICANCE

The case places significance on the fact that settlement of property falls under the
confines of property transfer involving divorced parties. The courts held that the

61
Re the trusts of the Abbott Fund
62
[1905] Ch 48
63
[1997] 2 ALL E.R 293
appellant as well as the respondent were delegated property by the district Registrar in
accordance with the Matrimonial Cause Act, but the appellant was unsure as to the
full meaning to the ruling passed. The case emphasized the importance of a trust to the
beneficiaries, the duty of a trustee which is not to meddle with the trust property and
the exception provided for a non-Zambian in relation to property ownership.

The courts were of the view that the appellant did need clarification on the meaning of
the order by the district registrar, but this was not the same for the claim that the
respondent could not own property due to his nationality.

The learned ought to have taken into consideration, as per the words of the appellant,
the fact that the respondent was a non-Zambian national who did not qualify under the
expectations in Section 3 of the lands Act that stated that land could not be alienated by
virtue of his nationality.

The appellant further set a claim establishing that there was an erred verdict passed
when the house was given to the respondent even though it was not in dispute that the
house in issue was acquired by the work and resources of both the appellant and the
respondent. It was pre-concluded upon that the house should have been conferred solely
to the appellant for the children’s benefit given the legal incapacity of the husband.

The exception for this can be distinctly brought forth through careful analysis of the
Matrimonial Causes Act No. 18 of 2010 which provided for the respondent to confer
ownership to his duly authorized agents as ordered by the District Registrar.

The lower courts in its ruling relied on the Matrimonial Causes Act of 1973 in passing
the judgment on property settlement which was to take place by operation of law, which
in accordance with Section 3 of the Lands Act Cap 184 of the Laws of Zambia,
particularly sub section (i) provides an exemption for instances involving nationality
which states as follows;

“Where the interest or right in land is being inherited upon death or is

being transferred under a right of survivorship or by operation of law”

, granting that the property settlement orders are by operation of law as guided
by the relevant provisions of the Matrimonial Causes Act.
The respondent retaliated by stating that the claim based the chamberlain v
chamberlain64 case as well as the quotation made in the Halsbury’s Laws of England
stating that “that both authorities demonstrated the intention of the courts to make
provisions for minor children until such time when they attain majority,” as counter-
productive as well as startling in the sense that it constituted for an argument that stood
for distribution of property by the family of the defendant as if the respondent had died
intestate as the appellant’s argument acknowledges that both properties were acquired
through hard work and resources of both parties.

It was eventually unanimously agree that the ground of appeal and well as the other two
were dismissed.

CONCLUSION

The decision in this article has been highlighted as important due to the fact that it
brings to light the exceptions that are present in a situation where land and ownership
of such land can be by a foreigner so long as they confer it to a legal agent. We were
able to see that in a situation where divorced parties desire to allocate property they can
do so as per Sec 24(1) (c) (d) of the Matrimonial Causes Act and if a non-Zambian was
in possession of such land it would be dealt with by operation of law. This judgment
goes without saying trusts are made for beneficiaries and no one else aside from the
designated beneficiaries can relish the fruits of a trust.

64
[1974] 1 All E.R. 33
RICHARD V DELBRIDGE (1874) LR 18 EQ 11

ABSTRACT
The decision in the case of Richard v delbridge (1874) is a remainder of the importance
of the proper legal formalities when making a gift. It highlights the issue of trusts and
the importance of the required legal procedures regarding the creation of a gift. In
layman’s language, simply expressing an intention or declaring words of a promise are
not enough to hand something over to someone, steps such as intent, delivery,
acceptance, capacity, documentations not forgetting consideration must be followed to
the latter.

The case grapples with the complexity of gift-giving and the nature of legal formalities.
It resolves around Mr. Richards ‘earnest desire to pass on his business to a family
member, Edward. It underscores the principle that equity will not perfect imperfect gift
by imposing trusts where no genuine intention to create a trust exists. The piece of
writing looks at the approach the court took regarding the conferment of the
requirement in the legal steps that Mr. Richard had to take to make the gift effective. In
short terms, this article looks at the approach the court of appeal took regarding the
requirements to address legal formalities when imposing a gift in respect to the creation
of a trust. The court of appeal‘s ruling sheds light on the content of property transfers
and necessity of clear expressions of intent.

INTRODUCTION
Mr. Richards endorsed a short memorandum on the lease of the business premises. In
Richard v delbridge, Mr. Richard sought to bestow his business upon his family
member, Edward. The pivotal question was whether the endorsement on the leasehold
deed constituted a valid trust or merely an imperfect gift. In the petition against the
court, the appellant relied on a gift that was not effective. Further the court was on firm
ground to state the maxim ‘equity will not perfect imperfect gift’ which means that
equity will not regard the beneficial interest as having been transferred to the intended
donee before legal title is considered to have done so. The case commentary delves
into the facts, legal reasoning, and significance of the court’s decision.
FACTS
Mr. Richards, the grandfather, purportedly gifted the lease and stock of his business to
his grandson, Edward, through a memorandum. It read ‘this deed and all thereto
belonging, I give to Edward from this time, hence, with all stock in trade.

Subsequently, Mr. Richard executed several wills, none of which explicitly granted the
lease and stock to Edward. When Mr. Richard died, the question arose as to whether
the lease was held on trust for Edward. It was ascertained that among the several wills
executed by Mr. Richard before he died, there was no reference made granting the lease
and stock to Edward.

Edward claimed entitlement to the lease and stock against the heirs of his late
grandfather, asserting that a trust had been created in his favour by the memorandum.

HOLDING
The court of appeal, prescribed over by sir Jessel MR, held that no trust had been
established in Edward‘s favour.

The court emphasized that words evidencing an intention to make a gift do not
automatically impose a trust. For a man to become a trustee there must be clear
expression of the intent to assume that role. Words to present gift merely indicate an
intention to transfer property to another, without retaining it for any fiduciary purpose.

SIGNIFICANCE
The case of Richard v delbridge (1874) highlights the fact that words that show the
intention to create a gift do not impose a trust. The court prescribed over by sir Jessel
MR, grappled with the fundamental question of whether the endorsement on the lease
constituted a trust or a failed attempt at an outright gift. The case reaffirms that equity
will not perfect imperfect gifts. Mere expressions of intent to give property do not
suffice to create a trust. In essence, every imperfect instrument could not be salvaged
by transforming it into a perfect trust. The court, while sympathetic to carrying out a
person’s intention, emphasized the adherence to proper meaning of words used.65

The emphasis on the constitution of a trust reflects a broader legal principle and the
importance of clarity and precision in legal transactions. Therefore, this in particular,
demands a high degree of certainty to ensure the enforce-ability of trust agreements

65
http://uolb.com/blog/cases/richards v delbridge-1874 - trusts – law
because without the proper formalities, there is a risk of misunderstanding, which can
lead to disputes and challenges.

While specific words like ‘I declare myself trustee’ need not to be used, the court
requires language indicative of the transferor’s conscious intent to create a trust. This
was aimed at preventing the loose constructions that could undermine the integrity of
legal instruments. Judith riches in the book optimize equity has stated that ‘an
ineffective transfer of legal title to a trustee will not be construed as a declaration of the
settler as trustee.66

This case serves a poignant reminder of the delicate balance between intention and legal
formalities because it accentuates the court’s role in interpreting expressions of intent
within the framework of established legal principles.67 The court underscores the
importance of proper formality in property transfers. Intent alone is insufficient; the
requisite legal steps such as delivery, acceptance, capacity, documentation and
consideration must be followed.

The requirement for formalities in trust creation ensures legal certainty and
predictability. It provides a framework which individuals can confidently structure their
affairs, knowing that their intentions will be upheld and enforced by the courts.
Furthermore, it is a fact that predictability is essential to help facilities commercial
transactions, estate planning, and wealth management because it allows parties to rely
on the validity and enforceability of trusts.

In the same vein, Sir Jessel MR, ‘for a man to make himself a trustee there must be an
expression of intention to become a trustee, whereas words of present gifts show an
intention to give over property to another, and not retain it in the donor’s own hands for
any purpose, fiduciary or otherwise68.

66
Riches optimize equity and trusts (7th edition 2017).page 69
67
http//uollb.com/blog/case/Richards v delbridge -1874
68
Mr. Ramjohn. Unlocking equity (5th edition, 2015).page 82
The case also dives into the situation of voluntary agreements: by rejecting the notion
of enforcing voluntary agreements without consideration, the court maintains the
integrity of trust law.

CONCLUSION
The case of Richard v delbridge serves as a cautionary tale for those navigating the fine
line between gifts and trusts. It highlights the key distinction in the formality required
for a transfer to be recognized and the significance of legal formalities in trust law. It
reinforces the principle that equity will not intervene to perfect gifts unless a genuine
intention to create a trust exists. The case remains a cornerstone in trust law, reminding
us that legal formalities matter even in matters of the heart and family legacy.
KNIGHT V KNIGHT (1840) 3 BEAV 148

ABSTRACT

The case of knight v knight established an important president that has played a major
role in trust law development. This case is important as it helps to clarify the
requirements for creating a valid private trust private express trust that is enforceable
in equity. This article looks at the approach that the court of chancery under the
judgment of Lord Langdale took in order to ascertain the validity of a private express
trust, the article seeks to provide clarity on the ground to be met For a private express
trust to be deemed valid and enforceable by equity under the president of the case the
position of this piece of writing is that the validity of a private express trust is construed
by the three certainties that were established in this case are regarded as a fundamental
requirements for the validity of a private express trust where the court held that for a
trust to be recognized and enforced in equity it must demonstrate clear, intention,
specify the subject matter of the trust and ascertainability of the beneficiaries or object
collectively known as a three certainties .

INTRODUCTION

This is a case that involved a dispute over the will of Richard Knight, who left his
estates to his brother, John Knight, with the intention that the estate be passed down to
the next male descendant of their grandfather. When John's son Richard died childless
and without a will, Thomas Knight, Richard's brother, settled the estate on individuals
not related to the original testator's grandfather, causing a disagreement among the
family members.

The case was brought to court to determine if there was a binding trust created by
Richard Knight's will that required the estate to be passed down to the next male
descendant in the direct line of their grandfather. After analyzing the language used in
the will, the court ruled that no binding trust was created, as there was not enough
evidence of certainty of objects, i.e., it was unclear which descendants were intended
to benefit from the trust.

The Knight v Knight case is significant in the legal history of England as it established
the "three certainties" principle in trusts law, emphasizing the importance of clear and
unambiguous language when creating trusts. The case also highlights the challenges
that can arise when family members disagree over the interpretation of a will,
emphasizing the need for clear communication and proper estate planning to avoid such
disputes.

FACTS

The case involved the properties of a wealthy iron master and founder of family fortune,
Richard I Knight who owned several properties among them included Leintwardine,
Downtown, and Croft Castle. He established a settlement, passing these properties
down the family line through series of trustees with intention of keeping the properties
within male lineage. Initially, the properties of Richard I Knight were conveyed to his
first son; Richard Knight (Eldest of his four sons). But having no male heir to the
properties made Richard Knight leave properties to his nephew, Richard Payne Knight
who was the son to his brother, Thomas Knight (Second son of Richard I Knight).
Richard Payne also hard no Male heir to the properties so he left his properties to his
Brother, Thomas Andre Knight. In his will, Payne Knight stipulated that if Thomas
Andre, his brother won’t have male heirs, the properties should go to the next male
descendants of their grandfather (Richard I Knight). The next male descendants were
those descendants of Edward Knight and Ralph (however Ralph’s male descendants
had already died). Payne Knight also expressed hope that his successors would

Continue the male succession, following their grandfather’s wishes. However, Thomas
Andre Knight died without a male heir, leaving his daughter Charlotte as his
descendants. Thomas conveyed the properties to his daughter Charlotte and Charlotte
married Sir William Edward Rouse-Boughton , meanwhile, John Knight, a male
descendants of Richard I Knight’s third son Edward Knight, claimed that Thomas was
legally bound to follow the male succession

Plan. Rouse-Boughton disputed to this, asserting that no such trust existed and that the
properties rightfully belonged to Charlotte and her family. In summary, the case
involved a dispute between John Knight and Sir William Rouse-Boughton over the
inheritance of the Knight family properties, with both parties arguing over the
interpretation of Richard I Knight’s original settlement and Payne Knight’s will. The
case highlights the complexities of trusts and inheritance in 19th -century England,
particularly when it comes to upholding family traditions and succession plans.
HOLDING

Lord Langdale MR held that the words of Payne's will were not sufficiently certain,
which meant that there had been an absolute gift to Thomas, who had taken the property
unfettered by any trust in favor of the male line. He formulated a legal test, now known
as the "three certainties". This test specified that for a valid trust to be created, there
must be three certainties:

Certainty of intention: there must be intention to create a trust;

Certainty of subject matter: the assets constituting the trust must be readily
determinable;

Certainty of objects: the people to whom the trustees are to owe a duty must be readily
determinable.

SIGNIFICANCE

The decision of the court in this case established what is known as the three certainties.
Lord langdale stated that in order to have a valid express private trust, there was need
to have the certainty of intention, certainty of subject matter and lastly the certainty of
object.

Certainty of intention, it must be clear that the settlor by word of conduct had the
intention to create the trust. In the case of Paul v Constance69, the court held that Mr.
Constance’s words, “the money is as much as yours as much as mine,” showed the
intention to create the trust. As one of the maxims of equity states ‘equity looks at the
intent rather than the form’. The court held that the use of precatory words does not
show the intent to form a trust which was seen in Re Addams70 in which it was held
that the word in full confidence of did not show intent.

The certainty of subject matter, which simply means that a trust, must-have identifiable
properties or it will fail as seen the case of palmer v Simmonds71 where it was held
that the word bulk lead to the uncertainty of subject matter hence causing the trust to
fail

69
Paul v Constance
70
Re Adams
71
Palmer v Simmonds
Lastly but not the least is certainty of object. These are the beneficiaries of the trust and
this means to say that the trust must have clear and identifiable beneficiaries. The tests
displayed establish the certainty of object in both fixed and discretionary trusts has
functioned well in previous times, hence, the significance is that it has served greatly
as precedent from its very existence and will continue to do so in the near future.

CONCLUSION

The case of Knight v Knight, decided in 1840, stands as a landmark case in the
development of trust law, particularly regarding the establishment and enforcement of
private express trusts. In this case lies in it the establishment of the criteria necessary
for a private express trust to be considered valid and enforceable by equity. Through
the judgment delivered by Lord Langdale, the decision not only provided a framework
for the requirements of a valid trust but also set a precedent that has greatly influenced
subsequent trust law jurisprudence.

The decision in Knight v Knight represents a watershed moment in the development of

trust law, establishing the criteria necessary for the validity of private express trusts.
Through Lord Langdale's elucidation of the three certainties, the case provided clarity
and guidance to both practitioners and courts grappling with trust-related disputes. Its
enduring legacy underscores the pivotal role it has played in shaping trust law
jurisprudence and reaffirms its status as a foundational precedent in the field of equity
and trusts.
YVONNE KUNDA V CYNTHIA KUNDA (APPEAL NO. 142/2019) [2020]
ZMCA 71 (3 SEPTEMBER

2020)

ABSTRACT
The decision in the case of Cynthia Kunda v Loretta Kunda plays a significant role in
the interpretation and application of Zambian law in the context of estate administration
and distribution. The decision in this case helps to clarify the role, responsibilities and
rights of the parties involved in the process of estate administration. The article at hands
looks at how the court of appeal of Zambia approached this case regarding the context
of estate administration and distribution. This article aims to provide substantial clarity
pertaining to estate administration and distribution, as well as the fiduciary duties of
personal representatives... The appellant commenced this action by way of originating
summons in the court below. This article clarifies the approach the court of appeals
took regarding the grounds of appeal brought by the appellants. The article will also
show its position according to the evidence and issue brought by two parties as the
appellant sought for an order for removal of a caveat placed on a lot 1473/Mb Lusaka
by the respondent.

INTRODUCTION

This was an appeal against the ruling of the lower court, under the judgment of Sharpe-
Phiri J, which found that there was no trust relating to the property lot 1473/Mb Lusaka
between the applicants and the late Margret Chileshe Mbunda, the learned trial judge
found that the late Margret Chileshe Mbunda was the beneficial owner of lot 1473/M,
Lusaka and that the applicants had no locus standi to sue the respondent in relation to
the property the lower court also found that estate of Chende-ende-Mbunda was not
fully administered. In this appeal, the appellants assail the decision of Sharpe-Phil J, in
which she dismissed their cause, the Appellants sought for an order for removal of a
caveat placed on lot 1473/M Lusaka, by the court of appeal after hearing the heads of
arguments for both the heads arguments for both the appellants and the respondent
found the foregoing appeal devoid of merit and was dismissed with costs to the
respondent.
FACTS

Augustine Chende-ende Mbunda died intestate in 1976 and left estate of Lot 1473/M
Lusaka, the certificate of title for the parcel of land being exhibited in the affidavit. The
Administrator General was appointed as an administrator of the estate and in 1978, the
administrator conveyed and assigned the property to the appellant’s mother, Margaret
Chileshe Mbunda as evidenced by the Lands Register.

In 1981, Chileshe Margaret Mbunda remarried and changed the children’s surname
from Mbunda to Kunda. She began to transfer portions of the property to her children
but demised before completion. Lot 1473/M was subdivided into three, and processing
of title was underway when the half-blood sister, the respondent placed a caveat on the
property claiming on interest. The respondent raised preliminary issues as follows: I)
Whether the Appellants are clothed with the requisite locus stand, notwithstanding the
representative capacity in which the Appellants have sought to commence these
proceedings. Ii) Whether the property known as Lot 1473/M New Kasama, Lusaka that
was administered in 1978 by the administrator general could be re-administered in
2017. Iii) Whether the Appellants have complied with the Administrator General’s Act,
Chapter 58 of the Laws of Zambia, particularly Section 17 and 18(1) thereof, prior to
the commencement of these proceedings. Iv) Whether the Originating Process issued
herein complied with Order vii Rule 1(a) and (b) of the High Court Rules CAP 27 of
the Laws of Zambia. An affidavit in support of the Notice to raise preliminary issues
was not filed. Appellants were not aware that the estate of their father had an
administrator.

After a search conducted at the Lands and Deeds Registry, it revealed that the
Administrator General had transferred the property in issue to their mother. The
Administrator General advised the Appellants Counsel that the office had never dealt
with the estate of the deceased father. Appellant’s Counsel believed that the Appellants
were duly appointed as Personal Representatives of the estate of their deceased father.
Counsel for the respondent submitted that the Originating Summons was defective for
failure to disclose the physical and postal address of Appellants. He pressed the Court
to strike the Originating Summons off for irregularity as the address is vital and rules
of the court are intended to assist the Court in the proper administration of justice. He
further argued that the Appellants lacked the requisite locus standi to commence the
action.

The property belonged to Margaret Chileshe Mbunda as it was assigned to her by the
Administrator General in 1978, and the property was part of her estate when she died.
The two estates were separate and it was a misconception for the appellants to
commence in a representative capacity. According to him, the assertion that the
Administrator General assigned the property to the Appellant’s mother as trustee for
the appellants was not supported by evidence. The Appellants’ opposition counsel was
that the irregularity in the Originating Summons was not fatal but curable. He cited
authorities to that effect. He reiterated that the Administrator General had never dealt
with the estate of Augustine Chende-ende Mbunda. Therefore, the assignment to their
mother was irregular. It was his view that the appellants could properly bring the matter
as done. Sharpe-Phiri J upon considering the application before her, found that the
Originating Summons were defective for want of endorsement of the Appellant’s
address and ought to be struck for irregularity. The learned judge reasoned that the
deceased father must have been the initial beneficial owner of Lot 1473/M as evidenced
by the certificate of title and entry on the Land's register. The property was later
assigned to the Appellants' mother by the Administrator-General. She referred to
Sections 33 and 54 of the Lands and Deeds Registry Act, Chapter 185 of the Laws of
Zambia which convey that a certificate of title is conclusive evidence of ownership. She
concluded that it was unambiguous that the property in question was owned by
Margaret Chileshe Mbunda as evidenced by certificate of title. She dismissed the
contention that the property was held in trust for the Appellants as the certificate of title
did not reveal any entry to that fact. She found that Lot 1473/M was owned by the
Appellants' mother and fell to be administered under her estate. It was her view that the
Appellants, as personal representatives of their deceased father's estate had locus standi
to commence the action pertaining to the said property. It was the learned Judge's
finding that the Administrator General administered the estate of the late Augustine
Chende-endeMbunda as evidenced by the entry on the Lands Register. The property
was conveyed to the Appellants' mother by the Administrator General. She went on to
observe that there was no evidence before her to the effect that the Appellants applied
for revocation of letters of administration granted to the Administrator General in
accordance with Sections 17 and 18(1) and (2) of the Administrator Generals Act,
Chapter 58 of the Laws of Zambia. She dismissed the action forthwith.

Whether the Appellants are clothed with the requisite locus standi, notwithstanding the
representative capacity in which the Appellants have sought to commence these
proceedings. Ii) Whether the property known as Lot 1473/M New Kasama, Lusaka that
was administered in 1978 by the administrator general could be re-administered in
2017. Iii) Whether the Appellants have complied with the Administrator General’s Act,
Chapter 58 of the Laws of Zambia, particularly Section 17 and 18(1) thereof, prior to
the commencement of these proceedings. Iv) Whether the Originating Process issued
herein complied with Order vii Rule 1(a) and (b) of the High Court Rules CAP 27 of
the Laws of Zambia in Cynthia Kunda v Loretta Kunda, the court held that Cynthia, as
the administratrix of the estate, had not fully administered the estate of her deceased
father, Augustine Chende ende Mbunda, in accordance with the law. Consequently, the
court determined that Loretta’s rights as a beneficiary had been infringed upon, as she
had a legitimate interest in the proper administration of the estate and the protection of
her share as a beneficiary. The court emphasized that administrators have a duty to
diligently carry out their responsibilities and follow the legal procedures in estate
administration to protect the interests of all beneficiaries. Failure to do so may lead to
legal disputes and potential consequences for the administratrices or administrators.
Furthermore, the court's decision in this case highlighted the importance of complying
with the Administrator General's Act and relevant provisions, such as Sections 17 and
18(1), before initiating administratrices or legal proceedings related to estate
administration. The court also stressed the need to follow the procedural requirements
under Order VII Rule 1(a) and (b) of the High Court Rules CAP 27 when filing an
Originating Process.

HOLDING

With regards to the three grounds of appeal raised by the appellant/, the courts found
that, in line with the first ground of appeal, the appellants appealed that the learned
courts had erred in law and in fact it was held that there was no trust relating to the
property of lot 1473/m.

The second ground of appeal was that the court erred in law and in fact that when it was
held that, Margret chileshe mbunda was the beneficial owner of lot 1473/m, Lusaka
therefore the property was to be administrated under her estate, hence, the court held
that the appellants had no locus standi to sue the respondent.

Lastly, the third ground of appeal was that the learned trail judge erred in law and in
fact when she did not find out that the property had not been fully administered for. The
court of appeal after due consideration with regards to the first ground of appeal held
that no trust was formed owing to the fact that the learned counsel for the appellants
did not state what law his was referring to and how that law applied to the estate of the
deceased with consideration of the formation of the trust.

With regards to the second appeal and third appeal the court held that the estate of the
deceased was administered by the administrator general under the provision of section
32 of the administrator general act14 of 1968. If the appellants had any interest in the
property, the administrator general would have ensured that they be noted in the
certificate of title

It was concluded that the mere fact that the appellant’s mother could have subdivided
the land proved that she was the beneficial owner of the estate. However, the appeal
that the estate of chende-ende-mbunda was not fully administered was void, hence, her
application to be appointed as administrator of the estate was invalid and so the court
decided that the foregoing appeal be devoid of merit and was dismissed.

SIGNIFICANCE

The case of Cynthia kunda v Loretta Kunda highlights the rights, roles and
responsibilities of the parties involved in the process of estate administration as it gives
an insight as to how the courts in Zambia may handle similar disputes, regarding the
evaluation of evidence, the application of relevant legal principles and the
determination as to whether the Administrator general has acted within his fiduciary
duties.

The courts in this case stress on adhering to proper procedures and ensuring compliance
with the relevant laws in order to contribute to the fair and efficient administration of
estates. The understanding of a caveat was recognized as a statutory notice that is
registered against a property. It serves as a notice that the person lodging the caveat (the
caveator) has an interest in the land https://www law teacher.net 1The appellants argued
that the only beneficiaries to the property where the issue from the union of the late
father and mother.

A concept that was broke out in this case is evident in the case of in goods of William
Loveday2, where it was held that the task of the court upon the exercise of probate
jurisdiction is to ensure that beneficiaries get what is due to them. And in this case the
maxim of equity that states that "Equality is equity" is relevant, due to the fact that the
deceased Margret Chileshe Mbunda did not complete dividing the property before her
demise. The maxim earlier stated means to say that in a case where two or more parties
have an interest in the same property but their interests are not quantified, equity as the
last resort may come in and equally divide the property amongst the parties involved.

The court emphasized that the administrators have a duty to diligently carry out their
responsibilities and follow the legal procedures in estate administration to protect the
interests of all beneficiaries. Failure to do so may lead to legal disputes and potential
consequences for administrators. Overall, the holding in Cynthia Kunda v Loretta
Kunda serves as a reminder of the legal obligations and duties of administrators in
managing estates and protecting the rights and interests of beneficiaries. The court's
emphasis on adhering to proper procedures and ensuring compliance with relevant laws
contributes to the fair and efficient administration of estates, minimizing potential
disputes and safeguarding the interests of all parties involved. The significance of the
Cynthia Kunda v Loretta Kunda case lies in its contribution to the understanding and
interpretation of Zambian law regarding the administration and distribution of estates,
particularly in the context of disputes between the Personal Representative and a
caveator. This case helps to clarify the roles, responsibilities, and rights of the parties
involved in the estate administration process. It provides insight into how courts in
Zambia may handle similar disputes, including the evaluation of evidence, the
application of relevant legal principles, and the determination of whether the Personal
Representative has acted in accordance with their fiduciary duties. The case may also
serve as a precedent for future cases involving similar issues, providing guidance for
legal professionals and lower courts when handling disputes related to estate
administration and distribution. It contributes to the development of a consistent and
predictable legal framework for addressing such matters in Zambia. Learned Counsel
argued that the Appellants lacked the requisite locus standi to commence the action.
That the property in question belonged to Margaret Chileshe Mbunda as it was assigned
to her by the Administrator-General in 1978 and that when she died; the property was
part of her estate. Counsel contended that it was a misconception for the appellants to
commence the action in a representative capacity, when the property belonged to the
estate of their mother. That the two estates were separate. Learned Counsel also argued
that a certificate of title is conclusive evidence of ownership, challengeable only on
grounds of fraud. According to him, the assertion that the Administrator-General
assigned the property to the Appellants' mother as trustee for the appellants was not
supported by evidence. Furthermore, the court's decision in this case highlighted the
importance of complying with the Administrator General's Act and relevant provisions,
such as Sections 17 and 18(1), before initiating legal proceedings related to estate
administration. The court also stressed the need to follow the procedural requirements
under Order VII Rule 1(a) and (b) of the High Court Rules CAP 27 when filing an
Originating Process.

CONCLUSION

The decision in the case of Cynthia Kunda v Loretta kunda is important because it
establishes Strong and solid judicial precedent on similar cases regarding the
interpretation of Zambian law in light of the administration and distribution of estates
clarifies the responsibilities and rights of parties involved in estate administration and
distribution, and it provides In a nutshell, the case of Cynthia Kunda v Loretta Kunda
serves as a reminder of the legal obligations and duties of administrators in managing
estates and protecting the rights of beneficiary the court. In this case, emphasized on
the adherence to proper procedure to ensure compliance with laws which contribute FO
the fair and efficient administration of estates. Minimizing potential disputes and
safeguarding the interests of all parties.

The conclusion drawn from the analysis of the Cynthia Kunda v LoretaKunda case
underscores its pivotal role in enhancing the understanding and application of Zambian
law concerning estate administration and distribution. By clarifying the roles,
responsibilities, and rights of the parties involved, the case establishes a framework for
resolving disputes and guides legal professionals and lower courts in handling similar
issues. Ultimately, the case contributes to the development of a consistent and
predictable legal system for addressing estate-related matters in Zambia.
MIDLAND BANK V. WYATT [1995] FLR 697

ABSTRACT
The decision in the case of Midland Bank v. Wyatt [1995] FLR 697 is an important
decision because it clarifies the position of the law regarding, the liability of a financial
institution in a situation where one party to a joint account engaged in fraudulent
behavior. The decision in this case reaffirms the position that is inequitable to allow
liability of a financial institution where one party to a joint account engaged in
fraudulent behavior The case delves into the principles of trust law and the
responsibilities of banks when dealing with joint accounts. furthermore, it depicts the
position of the court on mere declaration of a trust without having matching subsequent
actions
INTRODUCTION
The case of Midland Bank v. Wyatt revolves around the question of whether a bank can
be held liable for breach of trust when one of the account holders misappropriates funds.
It highlights the complexities surrounding joint accounts and the legal obligations of
financial institutions.
This case also clarifiers intention in a trust and that mere declaration of a trust is not
enough if the genuine intention cannot be found. In this case the settlor understood the
meaning of a trust, he knew what it meant to have property on trust but as stipulated the
intention of the settlor must be shown by his actions and words as seen in the case of
Paul v Constance and the actions following the creation of this trust shows no intention
as he it to get more loans to support his business
FACTS
Property – beneficial interest – house purchased by husband and wife in joint names –
spouses executing declaration of trust giving equitable interest to wife and the spouses'
two young daughters – husband subsequently arranging business loans – business
failing – bank obtaining charging order nisi on husband's interest in property – whether
husband could rely on declaration of trust – whether declaration of trust void or
voidable.
In 1981 the defendant husband and his wife purchased a house ("the property") which
was registered in their joint names. In 1983 they executed a legal charge with the
plaintiff bank to secure a house mortgage loan. In 1986 the defendant decided to set up
his own company. Following legal advice, the defendant entered into a trust
arrangement with his wife giving the equity in the property to her and their two
daughters. The trust deed was dated 17 June 1987. It was signed by the defendant and
his wife though the wife stated that she left all financial matters to her husband and
would most probably have signed not really knowing what she was signing. During
1987 and 1988 the defendant obtained further loans from the bank to finance the setting
up of his company on the security of his interest in the property. In 1989 the defendant
and his wife separated. In 1991 the defendant's business went into receivership. The
defendant at no stage informed the bank, his business partner, or the solicitors acting
for the wife in connection with the separation, of the declaration of trust. In all his
dealings with the bank, the defendant had allowed the bank to understand that he and
his wife were the beneficial owners of the property.
The plaintiff bank obtained judgment against the defendant husband for £63,135.50
plus £205 costs. Following that judgment, the plaintiff bank obtained a charging order
nisi on the defendant husband's interest in the property. The defendant resisted the
making absolute of the charging order, relying on the declaration of trust giving his
equity interest in the property to his wife and two daughters. The plaintiff contended
that, even if the declaration of trust was executed on 17 June 1987, it was either void as
being a "sham" transaction or voidable under s 423 of the Insolvency Act 1986.
HOLDING
It was accepted that as there was a duly executed declaration of trust, the burden of
proof that the transaction was a sham or was voidable under s 423 of the Insolvency
Act 1986 fell on the plaintiff bank. As a standard of proof, it was necessary for the court
to be fully satisfied as to the true nature or object of the transaction in question. On the
facts in this case, when the defendant executed the trust deed, he had no intention of
endowing his children with an interest in the property; it was executed by him, not to
be acted upon but to be put in the safe for a rainy day, as a safeguard to protect his
family from long-term commercial risk should he set up his own company. As such the
declaration of trust was not what it purported to be but was a pretense or a sham. Even
if it was entered into without any dishonest or fraudulent motive but was entered into
on the basis of mistaken advice, the transaction was still void and therefore an
unenforceable transaction if it was not intended to be acted upon but was entered into
for some different or ulterior motive. The declaration of trust purporting to transfer the
defendant's interest in the property to his daughters was a transaction entered into
without consideration and fell within s 423 of the Insolvency Act 1986. As the
transaction was entered into for the purpose of putting the defendant's assets beyond
the reach of any future creditors, it was voidable under s 423 of the 1986 Act. In the
circumstances the declaration of trust could not be relied upon by the defendant to resist
the making of the charging order absolute.
SIGNIFICANCE
This case falls under the three certainties that was established by the case of knight v
knight72 and falls particularly the first certainty, the certainty of intention. It established
the importance of intention in a trust and that mere declaration of a trust was not enough
if genuine intention cannot be found. He understood the benefits that come with
creation of a trust. As stipulated the intention of the settlor must be shown by his actions
and words as seen in the case of Paul v Constance73 and the actions following the
creation of this trust shows genuine no intention as he got more loans to support his
business and when a trust is created the settlor is not supposed to have beneficial interest
but he masqueraded as the beneficial owner of that property.
The case also clarifiers the equity maxim He who comes to equity must come with
clean hands which means equity demands fairness from defendant but also from the
plaintiff. It is therefore said that “he that had committed an inequity, shall not have
equity with the regards to the aforementioned case the defendant’s committed an
inequity thus he shall not have equity as his actions were fraudulent.74
It also addresses the legal principles governing joint accounts and the obligations of
banks to protect the interests of account holders. It underscores the importance of trust
law and the distinction between innocent third parties and wrongdoers in cases
involving joint accounts. Moreover, it clarifies the limits of a bank's liability in such
situations, highlighting the need for account holders to exercise caution and vigilance.
CONCLUSION
In Midland Bank v. Wyatt, the court ruled in favor of Midland Bank, holding that the
bank was not liable for breach of trust as it had no knowledge of Mr. Wyatt's fraudulent
actions. In conclusion to this, The Midland Bank plc v Wyatt case serves as a notable
precedent in English contract law, highlighting the importance of clarity, formality, and
adherence to contractual terms. While Mr. Wyatt argued that the bank's conduct led
him to believe he was released from his guarantee obligations, the Court ultimately

72
[1840] 3 Beav 148
73
1977] 1 WLR 527
74
Riches Judith “optimize Equity and Trusts.” 2nd ed. P30
ruled that without a clear and unequivocal agreement, he remained liable under the
guarantee. This decision underscores the principle that parties cannot be released from
contractual obligations based solely on implied intentions or informal communications.
It emphasizes the need for parties to ensure that any modifications or releases to
contractual obligations are made in accordance with the terms of the agreement or
through separate, formal agreements. As such, the case underscores the importance of
precise language and formal agreements in contractual relationships, providing
guidance for future contractual disputes.
RE KAYFORD LIMITED [1975] 1 WLR 279

ABSTRACT

The case of Re Kayford is an important case because it highlights the significance of

conduct in the creation of a valid. It simply shows that the intention of the settlor can
be accounted for merely by one`s conduct.

The court held that the money was subject to a trust. It fulfilled all the requirements for
the creation of a trust including certainty of intention and of beneficiaries as well as
subject matter. The annotation in this legal draft is of concern as to whether or not the
opening of a separate bank account for the deposit of money by customers shows the
necessary intention to create a trust.

INTRODUCTION

This case considers the issue of the intention to create a trust by conduct and whether
or not the opening of an individual bank account for the deposit of money by customers
shows the necessary intention to create a trust.

FACTS

Kayford Limited ran a mail order business and customers either paid the purchase in
full price or a deposit when ordering the goods. The company`s main supplier ran into
financial difficulties and fearing insolvency as a result, the accountants of Re Kayford
Limited advised that the company open a separate account to be called `Customers
Trust Deposit Account` into which all further sums of money paid by customers for
goods not yet delivered should be paid.

This advice was not precisely followed as a dormant deposit account was used in which
there was already a credit balance of £47.80. A fortnight later Kayford Limited resolved
to go into liquidation and it was shortly after this that the words `Customer Trust
Deposit Account` were added to the name of the dormant deposit account.

In liquidation proceedings the question arose as to whether the money in the account
now amounting to [£37,872.45] was held on trust for customers who paid it or whether
it formed part of the assets of Kayford Limited and was thus available to creditors of
the company.
HOLDING

The court held that, the advance payments were held on trust declared by the company
for customers. The steps taken by the company to pay the money into a separate account
were evidence of an intention to create a trust and that the company had made it clear
that it had no right to use the money itself.

The company`s intention was to create a trust over the prepayments which had been
manifested by transferring those prepayments into a separate bank account so as to
shield them from the insolvency. The company in this case of a legal owner and trustee
and the customers were beneficiaries.

Megarry J stated that ` there is no doubt about the three certainties of a trust. The subject
matter to be held on trust was clear, so were the beneficial interests as well as the
beneficiaries. As for the requisite of certainty of words, it is well settled that a trust can
be created without using the word trust. `

SIGNIFICANCE

This case espousals on the issue of creating a trust with intention through conduct. The
court set a verdict in favour of the defendant by unanimously agreeing that a trust was
created for the customers by virtue of creating a separate account and transferring the
money in the account before the date of liquidation.

In relation to the issue of certainty of intention, the Re Kayford case established that a
company must be in clear and specific in its intentions, and cannot simply set the
general or vague objectives. This is important because shareholders understand what
the company is trying to achieve, and prevents the company from making vague or
misleading statements about its objectives.

Additionally, the case also established that even if a trust is not verbally declared, the
actions of the settlor can still show the intention. This principle can be seen in the case
of Paul V Constance75, where, ` Mr. Constance, who was separated from his wife,
began living with Mrs. Paul in 1967. He opened a bank deposit account and paid into it
£950, which he had received as damages for personal injury. Although the account was

75
Paul v Constance [1977] 1 WLR 527
in his sole name, he told Mrs. Paul on many occasions that ‘the money is as much yours
as mine’. The Court of Appeal held that, by his words and conduct, Mr. Constance had
declared himself trustee of the account during his lifetime, both for himself and Mrs.
Paul. ` A declaration of trust may be construed from the settlor’s words and conduct.

It is important to note that such a trust will not be valid where it constitutes a preference
of those who are already legally regarded as creditors.76 This is illustrated in the case
of Re Farepak Food and Gifts Limited77,` in which Farepak operated a Christmas
savings scheme through 26,000 agents to whom customers paid small amounts of
money. The agents then passed the money on to Farepak. Just before Christmas 2006,
Farepak became insolvent (owing £38 million) and in the three days leading up to
administration, the directors sought to set up a trust of the monies received from
customers. The directors’ intention to create the trust only existed in the last three days.

The court held that for this to be effective, the trust must have existed when the
company (including the agents) received the money and very few would fall into this
category. Money received from pre- payment customers may be held on trust provided
they not creditors.

In a nutshell, the courts held that intention to create a trust can not only be by the words
of the settlor but also, by the conduct of the conduct. Hence, the trust was valid. By
virtue of creating a separate account for customers and transferring the money to the
account, Re Kayford Limited created a trust by their conduct.

CONCLUSION

The preposition in his article as it has been contemporarily highlighted, has found that
trusts of valid nature do not necessarily rely on mere words and documentation, though
such are vital, it was concluded upon that genuinely implied conduct, can constitute for
the formation of a validly measured trust.

76
Riches J [2017], Optimize equity and trusts, 2 nd Edition, Routledge, New York. P30
77
Re Farepak Food and Gift Limited [2006] EWHC 3272
PALMER V SIMMONDS [1854] 2 Drew 221

ABSTRACT

The case of Palmer v Simmonds is an important case because it is used as a precedent

by the courts in deciding cases involving trusts lacking the certainty of subject matter.
The case clarifies the need for a trust to be valid. The aforesaid case further reaffirms
that for a trust to be valid, it must consist of a minimum set of requirements namely;
The certainty of intention, the certainty of subject matter as well the certainty of object.

Furthermore, this article looks at the decision of the court in determining if the trust that
was executed was valid or not. The position of this piece of writing is that certainty of
subject matter in a trust must easily be unidentified or uncertain

In addition, it further discusses the use of legal terms when describing persons to take
in remainder, whether absolute or only in certain events. It also discusses the use of
legal terms when giving residuary estate. However, the text argues that the term "bulk"
is not appropriate when giving capital or expressing what remains after Harrison
exhausts some of the capital. The term "bulk" is commonly used to describe the greater
part of a person's property, which is consistent with its classical meaning. The text
concludes that the testatrix has not designated the subject of her confidence, and there
is no trust created. The court concludes that Harrison took absolutely, and those
claiming under him now take.

INTRODUCTION

The Palmer v Simmonds case, adjudicated in 1854, was based on the principle of
English trusts law, which requires certainty of subject matter for the validity of an
express private trust and scrutinizing the trust that was created. The settlor must use
words that can clearly identify the subject matter of the trust, and the subject matter
must be in existence and not subject to any condition at the time of the trust's creation.
In the case of Palmer V Simmonds, the settlor did not adhere to the requirement of
certainty of object, which was the subject matter of the trust.

FACTS

The testatrix, Henrietta Rosco, gave her residuary estate to her nephew, Thomas
Harrison, and his grandnephew, William Fountain Simmonds, for his own use and
benefit. She had confidence in him that if he died without lawful issue, he would leave
the bulk of her estate to his children, A, B, C, and D. equally. The will included gifts of
£2500 and £800, with the intention to invest the funds in public stocks or funds of Great
Britain and pay dividends and annual produce for Henrietta Rosco Markham until she
was twenty-one years old. The trust also included a £800 trust fund, with the principal
to be divided equally between the siblings of Thomas Harrison and William Fountain
Simmonds. The testatrix's representatives, Mr. Campbell and Mr. Law, stated the will
and submitted the question. The court held that there was a trust, as Thomas Harrison
had died without leaving issue. The difficulty lies in the word "bulk" in the will, which
meant providing for the widow for life and dividing the income.

JUDGEMENT

The court ruled that the word "bulk" does not create uncertainty in the subject of the
gift, as it does not necessarily mean the entirety of the property. The testatrix's intention
to give to Harrison absolutely was not clear, as she was not creating a trust by using the
word "confidence." The court also noted that the word "bulk" may sometimes mean the
whole, but it is more of a trust of the whole for the persons named, subject to a power
in Harrison to make a provision for his widow. The court emphasized that the testatrix's
words "as I have full confidence" were sufficient to create a trust, but the question was
whether the subject was certain. The testatrix used a term that may have two different
senses: strict or classical, and popular. If its strict or classical sense and popular sense
are coincident, then no difficulty can arise as to the sense in which the testatrix uses it.

SIGNIFICANCE

This case shows the facts that the certainty of subject matter is important in the sense
that it’s broader implications for the interpretation of trusts instruments and the
principle of governing trust law. The analogy principle strictly applies to trusts,
particularly in cases involving trust uncertain language in trust documents.

Pursuant to unlocking equity and trusts, certainty of subject matter inherently deals with
two concepts namely the trust property and beneficial interest.78 If the trust is uncertain
just like in the aforesaid case, the trust fails. Secondly, this case emphasizes on the
importance of clear and precise language in a trust so as to avoid ambiguity and ensure

78
Unlocking equity and trusts- Mohmed Ramjohn, 5th edition (2015)
the settlors wishes are accurately reflected. The case also highlights the needs for clarity
in terms of trusts, because if the words are uncertain, it can be difficult for the trustee
to understand what the settlor meant in the trust.

The case of Palmer v Simmonds is frequently cited for it guides on the necessity of
disposition of property. Lastly, this case has influenced case law by serving as a
precedent in cases where the settlor’s language is under scrutiny or uncertain rather.
This is because the courts refer back to the principle of this case when they are dealing
with a similar lacking the certainty of subject matter. This case also serves as a key case
study in trust creations.

CONCLUSION

The principle in Palmer v Simmonds is far back equitable principle, still relevant and
operative till toady. The rationale behind this principle is clear. There is no point
creating a trust in respect of a subject matter which cannot be identified. The point is
that the trust is likely to fail if the property left on trust is unidentifiable or uncertain.

In addition, the word "bulk" does not create uncertainty in the subject of the gift, but
rather assigns the reason for giving to Harrison absolutely. The court also noted that the
testatrix's use of a term that is not a legal term has not been considered appropriate in
the case.
BOYCE V BOYCE

ABSTRACT

The decision in Boyce v Boyce is an important case because it clarifies the need for the
beneficial interest to be identifiable. The decision in the case reaffirms that a trust in
want of beneficial interest is invalid.

79
According to unlocking equity and trust, a trust is an equitable binding on a person
called a trustee to hold onto the properties of the testator on behalf and for the benefit
of the person called the beneficiary. This is evidence enough in a trust that the
beneficiary interest must be identifiable if the trust is to be valid.

INTRODUCTION
80
Boyce v Boyce is an English decided case of 1849 which was based on equity and
trust. it concerns with certainty of subject matter. the case resurfaces the aftermath of
failure to recognize the beneficial interest.

FACTS

Richard Boyce made his will after appointing Elizabeth as the executrix. He expressed
himself saying, “I give and devise to my wife Elizabeth and to her assigns during her
natural life, my house where I now reside, with the yards, gardens and appurtenances
now belonging in my own occupation. My wife residing in the same house and premises
during her natural life and permitting my three daughters, Maria Boyce, Charlotte
Boyce and Mary Ann Boyce, so long as they continue single and unmarried.”

The testator had tangible properties which were houses in Southwold which he left for
his wife in a will. After the death of the wife, they conveyed in trust the houses to his
two daughters, Maria Boyce and Charlotte Boyce. Maria was his first daughter and
Charlotte was his second daughter. The problem was that the will included a provision
that Maria was to choose which of the houses in Southwold she wanted and that the
residue that was left was to be selected by Charlotte.

Maria died in the testator’s lifetime, meaning that she could never make the choice
because the testator was still alive. The house that charlotte was supposed to choose

79
Unlocking equity and trust
80
Ivory research
was uncertain, because Maria’s gift of her making the decision to then free the potential
houses for Charlotte to choose was never made81.

HOLDING

In the court of chancery, the vice chancellor held that the trust failed because it was
uncertain which house Maria would have chosen and which Charlotte.

SIGNIFICANCE

82
This case highlights the fact that for a trust to be valid, the beneficial interests in trust
must be identifiable. The court of chancery found that the trust had failed because the
beneficial interest was not identifiable. The case further, explains how essential the
certainty of subject matter contribute to the validity of a trust.

The certainty of subject identifies the asset held on trust and therefore reducing the
potential of disputes and misunderstanding. in addition, the court relies on this
principle, certainty of subject to uphold the integrity and enforceability of legal
agreement.

Boyce v Boyce case helped to establish the principle that properties in a trust fund has
to be segregated from other properties, so that it's identify is sufficiently clear.

CONCLUSION

The case brought to the fore the certainty of subject must be to the beneficial interest
must be identifiable. failure to which the trust will be invalid.

81
Legal information institute
82
Justia
RE GOLAY’S WILL TRUSTS [1965] 1WLR 969

ABSTRACT

In the legal case of Re Golay’s will trusts, the central issue revolved around the
requirement for subject matter to be sufficiently certain in a trust. Adrian Golay’s will
expressed his desire for Mrs Bridgewater to “enjoy one of my flats during her lifetime
and to receive a reasonable income from my other properties.”

The uncertainty arose from the lack of clarity regarding which specific flat she should
enjoy, the executors were able to choose which flat Tossy(Florence Bridgewater)
should live in but did not know what income would be considered reasonable. The court
came in and held that the trust was sufficiently certain because the term provided a
sufficient yardstick to enable the courts to calculate the amount based on the
beneficiary’s previous standard of living. A yardstick can be described as a rule or
specific idea about what is acceptable or desirable that is used to judge or measure
something.83

The requirement of the certainty of subject matter is a requirement that the property
which is intended to constitute the trust fund is segregated from all the other property
so that its identity is sufficiently certain.

INTRODUCTION

Adrian Golay wrote a will saying that he wanted Mrs Florence Bridgewater to enjoy
one of his flats during her life time and to receive reasonable income from his other
properties. The will was questioned whether the clause was certain enough to be
enforced, because it was not clear on what income would be reasonable. The issue was
whether the testator by the words “reasonable income” has given an indicator of his
intention to provide an effective determinant of what he intends so that the court in
applying the determinant can give effect to the testator’s intention. The term ‘reasonable
income’ in this case was said to have provided a sufficient yardstick to enable the courts
to calculate the amount based on the beneficiary’s previous standard of living. A will
trust or testamentary trust pursuant to Judith Riches’ Optimize Equity and Trust is a
situation where a testator creates the trust for a beneficiary in his or her will in which

83
Britannica.com
he appoints executors who are under a duty to transfer legal title to the trust property to
his trustees.

FACTS

In this case, Adrian Golay(the testator) directed that Tossy(Florence Bridgewater) was
to enjoy one of his flats during her lifetime and to receive a reasonable income from his
other properties.

The will was challenged due to uncertainty over which flat was to be enjoyed by Mrs.
Bridgewater and what constituted a ‘reasonable income’.

The executors were able to choose which flat Tossy should live in but the issue for the
court arose over the quantification of a reasonable income.

The case was concerning terms that created problems for the executors in line with the
subject matter, though the property was mentioned by the testator, the court looked at
the term “reasonable income” and assessed it in an objective manner by saying that the
reasonable income is not uncertain and can be assessed easily because the court would
not face any difficulty in ascertaining the certainty of reasonable income rather, the
court looked at the previous position of the beneficiary according to the standard of
living that Florence Bridgewater had.

As per the case, the testator’s intention of a ‘reasonable income’ was seen by a yardstick
that the court used to apply in quantifying the amount.

HOLDING

The court held that the term ‘reasonable income’ provided a sufficient yardstick to
enable the court to calculate the amount based on the beneficially’s previous standard
of living.

The court, presided over by Ungoed-Thomas J, held that the trust was sufficiently
certain.

The court held that a provision for a “reasonable income” could be valid if an objective
standard could be applied. In this specific context, the executors were allowed to select
one of the flats for Mrs. Bridgewater, but the question remained whether the direction
for a reasonable income was void for uncertainty. Ultimately, the court found that the
provision was sufficiently certain to be enforced by use of a yardstick to make an
objective assessment of what is reasonable.

SIGNIFICANCE

The case highlights on the certainty of subject matter where the trust property is certain
but the beneficial interest is deemed to be uncertain as a result of the term used to
describe the beneficial interest and how the courts in this case are able to make an
objective assessment of the amount the beneficially should receive based on the
circumstance of the case, where the beneficial interest is insufficiently certain because
of words like ‘reasonable income’ which sound uncertain but are considered by the
court to be sufficiently certain as a result of the objective assessment of the amount.

The court reviewed that the term ‘reasonable income’ provided a sufficient yardstick to
enable the court to calculate the amount based on the beneficiary’s previous standard
of living, this entails that a trust does not automatically fail where there is no clarity on
the beneficial interest because of the kind of words used to describe the beneficial
interest instead the courts may provide a sufficient yardstick to enable them calculate
the amount. Provided the terms used are reasonable and do not arise in isolation for
example a ‘reasonable amount to be held on trust’ where there would be no yardstick
to calculate the amount as seen the book Optimize Equity and Trusts by Judith Riches.
In a simpler explanation as per the book mentioned above, If the court has a yardstick
to make an objective assessment of what is reasonable with respect to the beneficial
interest, the trust or gift will not fail.

The court’s decision in the case hold an immense importance. It reinforces the principle
of consideration, clarifies the requirement for the will trust formation and promotes
legal certainty.

The decision made by the court helps them to serve cost and time instead of it resolving
the same case over and over(Judicial Precedents). This shows that the courts help
determine what words are certain and gives more knowledge about knowing the
objective assessment of the properties.

CONCLUSION

The decision in this matter is important because it entails that the courts are able to
consider terms like ‘reasonable income’ to be sufficiently certain in a situation where
they can provide a sufficient yardstick to calculate the amount for the beneficiary based
on the circumstance of the case84. They did this partly because if they did not, English
law would fall apart and the court always talks about things being reasonable. The court
is constantly involved in making such objective assessments of what is reasonable and
it is not to be deterred from doing so because subjective influences can never be wholly
excluded.

84
Optimize Equity and Trusts Second edition published 2017 by Routledge
SPRANGE V BARNARD (1789) 2 Bro CC 585

ABSTRACT

This is a landmark English law trust case concerning the certainty of subject matter. It seeks to
provide that when proportions of trusts are uncertain the case is bound to fail. Like in this case the
wife (testatrix) said “the remaining part of what is left on his death should be bequeathed to her
brothers and sisters.” There was no certainty as to what might be left if at all it might be left.
According to Sir Richard Arden, it was said that no trust arose because the husband had the option
to take all the property. This made the statement a gift rather than a trust because “the taking all”
dominated the wife’s intention. The statement was too uncertain for the trust to take effect to over
any part of the property. Because the property was not sufficiently clearly identified. The above
statement encoded that the husband was however not bound by any trust.

INTRODUCTION

This is an English derived case focusing on the certainty of subject matter to create a trust. The
main factor to look at is the description given by the settlor in identifying the property and in this
case, the description of the property identified by the expression “the remaining part of what is
left” was sufficiently uncertain and made the trust impossible to be executed by the courts of law.
Instead, the beneficiary took the estate absolutely as a gift.

FACTS

Sprange v Barnard is a legal case that occurred in1789. In this case a testatrix provided that
property would be left to her husband to use absolutely but that the remaining part of what is left
that he does not want for his own wants and use was to be held on defined trusts.

A testatrix indicated that property would be left to her husband to utilize as he considered
appropriate, but that the remainder of what he did not desire for his own wants and use would be
distributed among the testatrix’s brothers and sisters.

HOLDING

The court held that the statement was too uncertain for the trust to take effect over any part of the
property because the property was not sufficiently clearly identified by the expression “the
remaining part of what is left”
SIGNIFICANCE

It must be certain what property is to be subject to the trust and what or share of the property each
beneficiary is entitled to since the trustee is to know what property he meant to have in his control
in the interests of the beneficiary. In Sprange v Bernard85 the testatrix provided in her will ….”For
my husband Thomas Sprange, to bewill to him the sum of £300 …for his sole use; and at his death,
the remaining part of what is left, that he does not want for his own be divided between her brothers
and sisters. The court granted that Thomas Sprange was entitled absolutely to the whole sum as
there was no certainty to what part of the property would be left at the widower’s death. One could
not say what property the trust was to “bite” on and therefore uncertain. Words such as “the bulk
of my estate” in Palmer v Simmonds were not sufficiently certain for a trust.

It is important that if there are to be property rights and responsibilities over a trust fund that fund
must be identifiable, or else it would not be possible for the court to know which property is to be
administered in accordance with the terms of the trust. Where the property is expressed in vague
or uncertain terms, the trust will generally be held to be invalid.

The subject matter must be clearly identifiable what estate, whether tangible or not, is the subject
of the trust. In Palmer v Simmonds (1854) 2 Drew 221, the phrase "leave the bulk of my said
residuary estate..." was used in a will trust. Sir Richard Torin Kindersley held that as the court
could not be sure which parts of the residuary estate were to be held on trust, the trust failed.

However, more recent judgments appear to favour the approach of Lord Jessel MR in Repington
v Roberts-Gawen (1881-82) LR 19 Ch D 520. In his judgement, he said "...the modern doctrine is
not to hold a will void for uncertainty unless it is utterly impossible to put a meaning upon it. The
duty of the Court is to put a fair meaning on the terms used, and not, as was said in one case, to
repose on the easy pillow of saying that the whole is void for uncertainty."86

This can be later be observed in the Re Golays Will Trust (1965)87 1 WLR 969, were the Sir Arwyn
Lynn Ungoed-Thomas held that the trust was sufficiently certain ……. In his judgement “the court
is constantly involved in making such objective assessments of what is reasonable and is not to be

85
Optimize Law Revision Equity and Trusts ( 2nd Edition)
86
https://www.lawteacher .net/free-law-essay/equity-law/an-express-trust-law-essay
87
https://www.coursehero.com
deterred from doing so …….the testator intented by reasonable amount, the yardstick which the
court could and would apply in quantifying the amount so that the direction in the will is not
defeated by uncertainty.”

CONCLUSION

The decision in this case sets out the importance of property that is subject to a trust must be
capable of satisfying the test of certainty. It is necessary for the testatrix or settlor clearly to define
the trust property and to identify clearly the separate equitable interest of the beneficiary. But in
this case the statement “the remaining part of what is left” was too vague thereby, the subject
matter was defeated by uncertainty.

The Court therefore determined that the testator intended to make a gift rather than establish a
trust, since there was no assurance about the subject matter, the money was not kept in trust and
instead belonged to the spouse as an outright gift.
STANDARD CHARTERED BANK ZAMBIA PLC V KAMBINDIMA WOTELA & 164
OTHER

ABSTRACT

The decision in the Supreme Court case of Standard Chartered Bank Plc V Kambindima Wotela
Highlights the approach taken by the court in determining what a fiduciary relationship is therein
the appellants (standard chartered) was the trustee while Kambindima Wotela and 164 others
(respondents) were the cestui que trust.

INTRODUCTION

The following commentary will explore the impact that the case of Standard Chartered Bank V
Wotela and 164 others had on how a claim under a pension scheme can be instituted as a trust
claim. The general aspect of the provisions in the limitation act being the defense of the appellants
for the contractual claims of the respondents. Furthermore the court gave an insight on how a
pension scheme may be both a contractual claim as well as a trust claim.

FACTS

The brief facts of the case are that the on the 8th of February 2012 the respondents commenced an
action against the appellants by way of summon and statement of claim before a learned Deputy
Register on the following grounds

(i) Payment of their retirement benefits inclusive of all the allowances from the various dates of
retirement up to the date of full settlement less what was paid for them.

(ii) Payment of the difference between the last drawn basic salary and the average basic salary
wrongfully used for calculation of terminal benefits.

(iii) Payment of arrears of housing allowances effective 1st October 1993 at 100% of basic salary
less what was paid up to dates of retirement.

(iv) Payment of salary arrears pursuit to salary increments of June 1995 backdated to January
1995.

(v) Payment of the deferred pension and arrears thereof in line with the June 1996 Anglo-American
Corporation Actuarial Valuation.
(vi) Interests thereon at current bank rates on Nos, i, ii, iii and IV above from various dates of
retirement to the date of full payment.

(vii) Any other relief the court may deem fit and

(viii) Costs.

Counsel for the appellants filed an application before the learned Deputy Register to set aside the
originating process on the following grounds

i. That the process was procedurally irregular

ii.that the process was statute barred and that the matter

iii.was res judicata.

The Deputy Register dismissed the application. The appellants appealed to the learned trial Judge.

After conducting a rehearing of the appellants application the learned trial judge found that the
claims for the retirement benefits, inclusive of all the allowances, difference between basic salaries
and average basic salary, arrears of housings allowances effective of 1st October 1993 at 100%
basic salary, as well as salary arrears pursuit to salary increments in June 1995, backdated to
January 1995 were Contractual claims. She therefore therefore held that they were caught up
under Section 2 of the Limitation Act of 1939 (hereinafter referred to as the act).

2(1) the following actions shall not be brought after the expiration of six years from the date in
which the cause of action accrued, that is to say

(a) Actions founded on a simple contract.

The learned trial judge found that six years passed before the respondents could make their claims
as the respondents were retired between 1994 and 1997,She accordingly held that the claims were
statute barred, However;

With regard to claim for deferred pension benefits and arrears of the pension scheme in line with
the 1996 Anglo-American Cooperation Actuarial Valuation, the lower court expressed the view
that a pension fund qualified to be described as a trust.
The thought by the appellants that the cause of action in relation to the pension accrued more than
six years earlier and that it was statute barred, the lower court found that that claim was not statute
barred as the appellants had concealed the enhanced pension entitlement from the respondents,
according to her this amounted to defrauding the respondents contrary to Section 26 of the Act
which states,

(26) Where in the case of any action for which a period of limitation is prescribed by law, this
Act either

(a) The action is based upon the fraud of the defendant either on his agent or of any person
through when he claims or
(b) The right of action is concealed by the fraud of any such person aforesaid or
(c) The action is for relief from the consequence of a mistake
The period of limitation shall not begin to run until the plaintiff has discovered the fraud or
the mistake as the case may be or could reasonable diligence have discovered it.

The trial judge found that there was no indication that the respondents knew of the benefits until
the date of this courts 2008 judgement in Standard Chartered Bank Plc V Willard Solomon
Nothing and 402 others.

Therefore the appellant’s contention that the respondent’s action was res judicata failed.

Therefore the appellants appealed against the ruling of the lower court stating that;

The lower court misdirected itself by holding that the claim for enhanced value of deferred pension
was not subject to the limitation of a period of 6 years set out in section 19(2) of the Act.

Furthermore the appellants contended that findings by the learned trial judge that the pension,
under Anglo-American Cooperation Actuarial Valuation was in the nature of trust was erroneous.
That the respondents did not allege that the appellants were the trustee under the pension scheme,
and that the respondents did not make did not make any claim against a trustee or allege that a
trustee had committed fraud nor that a trustee had converted property to his own use.Counsel for
the appellants faulted the lower court for having shifted to the appellants the onus of proving who
managed the pension scheme, they stated that it was contrary to the rules and procedures of court
which requires that the plaintiff should sue the right party and prove its allegations.
HOLDING

The court held that the appellant was the trustee for the said scheme because the evidence on the
record of appeal clearly established that the appellant held the Respondents’ pension benefits under
this pension scheme and that in the court’s opinion, a relationship existed whereby the appellant
was the trustee and the Respondents were the cestui que trust. Finally the court acknowledged the
lower court’s ruling and stated that the lower court properly directed itself when it held that the
claims for deferred pension were in the nature of trust claims and the Appellant was the trustee
under the pension scheme.

SIGNIFICANCE

The case of Standard Chartered Bank Zambia Plc v Wotela and Ors88 showcased the trust
relationship that exists between the employer and his employees. As we can clearly understand
from the facts given that the case was an issue arising from the employees in this case the
respondents did not receive their full benefit from the voluntary severance scheme.

In a 2012 filled application the claimants based to originate the process on grounds that:

(i) That the process was procedurally irregular;

(ii) That the process was statute barred; and
(iii) That the matter was res judicata meaning ‘a matter judged’

The Deputy Registrar dismissed the application. Now the Appellant have appealed to the learned
trial Judge on grounds that;

1. the Court below erred both in law and in fact when it found that the Respondents had pleaded
fraud against the Appellant in the absence of any clear and distinct allegation of fraud or particulars
thereof being set out in the Statement of Claim filed by the Respondents;

2. the Court below erred both at law and in fact when it found that the claims for payment of
Deferred Pension and arrears thereof in line with the June 1996 Anglo American Corporation
Actuarial Valuation were in the nature of trust claims;

88
APPEAL NO. 1/2014
3. the Court below erred both at law and in fact when it found that the Respondents had established
a prima facie case of fraud against the Appellant and that the question that remained to be
determined was when the alleged fraud was discovered by the Respondents; and

4. the Court below erred both at law and in fact when it found that claim number (v) as relates to
the enhanced value of the deferred pension was not statute barred and as such, the Respondents
could proceed with their claims.

The learned trial judge alluded that these grounds of appeal had no merit. This is a decision which
was made upon hearing both sides of argument from counsel of the respondent and of the
claimants. There after the court quoted the Limitation Act89.

Accordingly, we hold that the learned trial Judge properly directed herself when she held that the
deferred pension was not subject to the limitation period of six years set by section 19(2) of the
LIMITATION ACT. For the above reasons, the first, third and fourth grounds of appeal have no
merit

Further, the issues to be resolved was whether the deferred pensions were in the nature of trust
claims; to illustrate of what constitutes a trust. The authors of HALSBURY’S LAWS OF
ENGLAND have defined a trust in the following terms:

“Where a person has property or rights which he holds or is bound to exercise for or on behalf of
another or others, or for the accomplishment of some particular purpose or particular purposes, he
is said to hold the property or rights in trust for that other or those others, or for that purpose or
those purposes, and he is called a trustee.”

And the case of Herdoon V Bellios90 defined the trust relationship as “It appears from the
evidence as it stands that the defendant became in October, 1892, the sole beneficial owner of
these shares, the legal title to which was vested in the plaintiff. Assuming this to be established,
their Lordships are at a loss to understand what more was required to create the relation of trustee
and cestui que trust between the plaintiff and the defendant. The fact that they never stood in the
relation of vendor and purchaser, that there was no contract between them, that the defendant never
requested the plaintiff to become his trustee, are quite immaterial. All that is necessary to establish

89
Limitation act 1939 sec2
90
(1901) AC 118
the relation of trustee and cestui que trust is to prove that the legal title was in the plaintiff and the
equitable title in the defendant.”

It was also established that a pension scheme can be brought under contract law or trust law and
to legally validate this the courts referred to the case of Imperial Group Pension Trust v Imperial
Tobacco Ltd91 taking a leaf from the case it was stated that ‘although in certain circumstances, it
may be necessary for the members of the scheme to sue in contract ( to obtain a mandatory order
that the company do exercise its powers in a particular way), I can see no valid reason why the
members of the scheme should be forced to sue in contract in all cases: contractual and trust rights
can exist in parallel.’

Upon these considerations the court held that the appellant was the trustee for the said pension
scheme with the liberty to pursue their rights under trust law the appellants were held as trustees
for the pension scheme thereby the defendants being the pension’s beneficiary and that a trust
relationship did exist.

The lower court properly directed itself when it held that claims for deferred pensions were in the
nature of a trust claim. With all grounds of appeal now having no merit and the appeal having
failed on all grounds, the case was dismissed with costs for the respondents.

CONCLUSION

The decision made in this case is important because it serves as a landmark case, emphasizing on
the concept that's a trust will occur whenever there is a fiduciary relationship, the rationale behind
this is that one person or entity will hold property both tangible and intangible for the sole benefit
of another, as seen in the renowned case of Sanat limited v Shaileshukmar Suryakant Amin.92

Furthermore the law will not allow this fiduciary relationship to fail on grounds that one party
didn't know that they were part to the same.

91
(1991) 1 ALL ER 597
92
[2019] ZM,CA 137.
NAWA SIPALO AND 3 OTHERS V SIPALO JUNIOR (HP 809 OF 2016) 2020 ZMHC

ABSTRACT

The decision in Sipalo and 3 others v Sipalo was significant in that it highlighted the duties of an
administrator in the distribution of properties to the rightful beneficiaries. The decision by the
courts acknowledged the position that it would be unjust to allow the administrator to distribute
property to anyone who he feels like but to distribute property to the rightful beneficiaries.

This account looks at how the property is to be distributed when the deceased died intestate, it also
highlights the duties of an administrator and the administrator ought to distribute the property in
accordance with Intestate Succession Act. This account further holds that the distribution of
property is done according to the law and not on moral grounds or obligation

INTRODUCTION

This is a ruling of the high court in an issue that involves the transfer of property held in joint
tenancy by a personal representative centrally to section 51(3) of the Land Deeds Registry Act93
chapter 185 of the laws of Zambia. And whether the court looks at the moral or legal obligation of
an administrator, furthermore the court found that the transfer of property to someone without
immediate beneficial interests in the estate declared the transfer illegal.

FACTS

The father Munukayumbwa Sipalo Senior died intestate, he left behind property which included a
farm known as farm NO. 675 of Lusaka west, cows, vehicles, tractors and household goods. The
first administrator was removed because he was abusing his power reaching an extent of using the
property title as collateral for a bank loan.

The beneficiaries of the estate sat down and chose one of the sibling by the name of
Munukayumbwa Sipalo junior as the administrator. The respondent subdivided the farm No. 675
to the beneficiaries, he later started selling land to other people without the blessing and consent
of the other beneficiaries the respondent also gave out farm No.675/w to their uncle through a deed

93
Lands and Deeds Registry Act, Chapter 185 of the Laws of Zambia
of transfer without the consent of the other beneficiaries, the respondent was called for a meeting
by the beneficiaries asking him to account for why he gave out property but the respondent never
gave a satisfying answer. The appellants took the respondent to court on the grounds that the deed
of transfer signed by the respondent be cancelled for there was no blessing of the other
beneficiaries and that the land should be subdivided equally to all the beneficiaries and that the
registry of lands and deeds should register the said piece of land in the name of the new
administrator.

The uncle to whom the land was given applied and he was added as the 2nd respondents

It was averred that the 2nd defendant help the 1st defendant to identify farm No. 675 the
beneficiaries never knew about the land, that the 2nd defendant was the one who was with the
deceased when purchasing the said farm consequently he was the only one who knew about the
farm. With putting all this in consideration the 1st defendant thought it would be kind to give the
2nd defendant the remaining piece of land as a sign of appreciation for all his done, and that he
helped the beneficiaries to get back the title of the property when the first administrator give it to
the bank as collateral for a loan.

All in all some of the beneficiaries did not consent so the still wanted the land back stating that
the 2nd defendant was not a beneficiary of the estate of the deceased therefore he should not benefit.

HOLDING

The high court held that conveyancing land without consultation or not obtaining consultation of
parties renders the disposition void at law and this was referred to the intestate succession act of
the laws of Zambia on duties of an administrator. The court in this case further held that it is
therefore averred that the respondent has no authority to give land to anyone or sell without the
consent of the other beneficiaries subsequently a consent of judgement was held on the 29 June,
2016 where it was adjudged that the monies received from the sale of land on farm no 675 Lusaka
west, and that the deed of transfer signed by the respondent on farm No 675 Lusaka west be
cancelled.
Lastly the court erred that it is hence the court duty uphold the law and not to judge and make
decisions based on moral standards. Consequently the plaintiff was charged cost and incidental
damages to be taxed in default of agreement and an appeal was thereby granted.

SIGNIFICANCE

The case is very important because it mainly focuses on the duties and powers of an administrator
specifically with regards to the distribution of property and the people entitled to it in line with the
intestate succession Act. The case also sets a legal precedent and provides guidance on how the
intestate succession Act should be construed and applied in similar situations.

The court stated that the administrator must not be morally obligated to give property to people
who are not entitled to it but the rightful beneficiaries by following the Act and no other person
especially near relatives can be entitled to the property when the spouse and children are still alive
unless the beneficiaries deem it fit upon themselves to give property to someone else.

The court referred to section 19 of the intestate succession Act,94 Chapter 59 of the Laws of Zambia
which provides for the duties and powers of an administrator. The section states as follows:

a) To pay debts and funeral expenses of the deceased and pay estate if estate duty is payable.

b) To effect distribution of the estate in accordance with the rights of the persons interested
in the estate under this Act;

c) When required to do so by the court, either on the application of an interested party or on

its own motion

i. To produce on oath in court the full inventory of the estate of the deceased; and

ii. To render to the court an account of the administration.

94
Intestate Succession Act cap 185 of 1989
The court later turned to the case of Mudende v Mudende,95 where the court held that ;The duty of
an administrator is not to enhance the estate, but to collect the deceased’s estate, distribute
it to the beneficiaries and to render an account.

The court also looked at the case of Mirriam Mbolela v Adam Bota96 where it was held that Section
19(2) of the Act is a statutory provision that was intended to prevent administrators of estates of
the deceased persons from abusing their fiduciary responsibilities by selling property forming part
of such estates without due regard to the interest of the beneficiaries.

The court also looked at the book Halsbury's Law of England, Fourth Edition,97 paragraph 1368
which states that;

The rules of intestate succession are laid down by statute and govern the distribution of residuary
estate of intestates.

Therefore, section 19 of the intestate succession Act was construed in its entirety by the court and
stated that the administrator should distribute the estate within the confines of the law and not as
he pleases.

CONCLUSION

The decision in this case is substantial because it brings to light the duties of an administrator in
the distribution of property according to the intestate Succession Act, Chapter 59 of the Laws of
Zambia. This case brought forth the fact that distribution of the deceased's property is done
according to the Law and does not operate on moral grounds or obligations. The decision taken by
the court in this case reiterates the contents of the Intestate Succession Act on the distribution of
property to the rightful beneficiaries by an administrator.

95
[2000] ZR 57
96
[2017] ZMSC 59
97
Halsbury’s Law of England, Fourth Edition
IRC V. BROADWAY COTTAGES [1955] CH 20

ABSTRACT

The decision in IRC V. Broadway Cottages trust is an important decision because it gives the
position of the law regarding the certainty of the beneficiaries or objects of a certain class in a
discretionary trust.

The decision of the court of the formulating ‘complete list test’ which states that a discretionary
trusts are valid only if it is possible to ascertain the class of the potential beneficiaries. This article
looks at the approach of the court of Appeal, regarding the validity of a trust. The issue raised in
this case was whether or not this trust was valid?

The position of this piece of writing is that a trust must be certain on the objects. A trustee must
be able to identify the beneficiaries even when the beneficiaries are a class of people then the
trustee can use his discretion to decide on how the trust property must be divided. In this article
this particular trust failed because the beneficiaries could not be identified.

INTRODUCTION

These are appeals by two charitable institutions, known respectively as The Sunnylands Trust and
Broadway Cottages Trust, from two Orders of Mr Justice Wynn-Parry both dated the 11th March,
1954, allowing appeals by the Commissioners of Inland Revenue from decisions of the Special
Commissioners to the effect that The Sunnylands Trust in the one case and Broadway Cottages
Trust in the other case were entitled to exemption from Income Tax for the years 1950/51 and
1951/53 under the provisions of Section 37(1)(b) of the Income Tax Act, 1918, in respect of certain
sums of money received by them respectively from the Trustees of a Settlement dated the 14th
July, 1950, and made between Alan Geoffrey Timpson (hereinafter called "the Settlor") of the one
part and the Settlor, William Drake Lee, and Peter Thomas Matthew Wilson (hereinafter called
"the Trustees") of the other part. The charitable character of the two appellant institutions and their
consequent right to exemption from tax on their income under the provisions of Section 37(1)(b)
are not in dispute.
FACTS

The Settlement comprised a sum of 80,000 made over to the Trustees by the Settlor, and in addition
to administrative clauses as to investment and so forth it included the following provisions: "(1) In
this Settlement the following expressions shall where the context so admits have the following
respective meanings and shall be construed in the following manner".

(7) AND if all the beneficial trusts hereinbefore declared shall fail . . . . Then the Trust Fund and
the income thereof shall be held upon charitable trusts to be declared by the Trustees . . . . to the
intent that neither the Donor or any Wife or Widow of his shall in any event whatsoever take any
interest by way of resulting trust or otherwise in the Trust Fund or the income thereof or any
accretions thereto or in any part of the same. (8) During the Appointed Period the Trustees shall
hold the income of the Trust Fund from the date or respective dates from which the Trustees shall
become entitled to such income UPON TRUST to apply the same for the benefit of all or any one
or more of the Donor's said Wife and the beneficiaries in such shares proportions and manner as
the Trustees in their discretion from time to time think fit (and so that such moneys as the Trustees
may from time to time think fit to apply for the benefit of any of the Beneficiaries who shall have
attained the age of twenty one years be paid to him or to her on his or her receipt which shall be a
complete discharge to the Trustees).

They include the issue however remote of the Settlor's father and of the father of the Settlor's wife,
and a number of named persons, including in some cases their spouses and issue.

It is further to be observed that clause 7 which precedes the trust of income declared by clause 8
contains a gift over upon charitable trusts "if all the beneficial trusts hereinbefore declared shall
fail". It is common ground that this clause, preceding as it does the trust of income during the
appointed period, has no application to the failure of that trust.

Reasoning

The principle can be concisely stated by saying that in order to be valid a trust must be one which
the Court can control and execute. Mr Pennycuick for the Appellants contends that it is satisfied
by the trust now before the Court. Mr Cross for the Crown contends that it is not. But as the class
is un-ascertainable, no such trust can be implied. Fourthly, the validity of the trust must be tested
by considering its terms and asking oneself whether the Court would be able to control and execute
the trust if called upon to do so. Consideration of the case on that assumption shows that the most
the Court could do would be to remove the inert or recalcitrant trustees and appoint others in their
place. And the making or withholding of any such distribution rests on the uncontrolled discretion
of the Trustees, which the Court can neither exercise nor compel to be exercised. If so, the bequest
is bad on the ground of uncertainty. Sixthly, the Court cannot mend the invalidity of the trust by
imposing an arbitrary distribution amongst some only of the whole unascertainable class. If
necessary the Court, acting on the analogy of the "relations" cases, could declare a trust in default
of distribution by the Trustees in favor of a modified class which could be completely ascertained.
We confess to some sympathy for the Appellants' argument, which has about it an attractive air of
common sense, but we do not think it can be allowed to prevail. We do not think a valid power is
to be spelt out of an invalid trust.

HOLDING

The appeal was dismissed. If the class of beneficiaries was an ascertainable class, it would or might
be possible to imply a trust in default of distribution by the Trustee for all the members of the class
in equal shares, and that would be a trust which the court can execute. But as the class is un-
ascertainable, no such trust can be implied. In the case the, since the class of beneficiaries was
ascertainable, no such trust can be implied and the trust cannot be executed by the court.98

SIGNIFICANCE

This case highlights one certainty of a valid trust. For a trust be valid the objects must be
ascertainable. It laid down that the trustees must be able to give a complete list of the beneficiaries.
If there are any potential beneficiaries who are the trustees are not certain of, or the trustees cannot
compile a complete list, the trust is void for uncertainty.

98
https://lawprof.co
CONCLUSION

The decision in this case is important because it brings to the fore matters concerning the certainty
of the beneficiaries and that the court must be able execute a trust and control it99. The decision
has brought to the fore the fact that for a trust to be valid, the beneficiaries must be certain.
Beneficiaries must be certain for a trust to be valid and in this case the trust failed because of the
uncertainty of beneficiaries.

99
Morice V Bishop of Durham 918040 9 Ves 399: 918050 10 Ves 522
MACPHAIL V DOULTON [1971] AC 424.

ABSTRACT

This is a landmark trusts law case decided by the House of Lords. The case revolves around the
crucial issue of the certainty of beneficiaries in discretionary trusts. The case marked a fundamental
restatement of the law regarding the certainty of objects for discretionary trusts. Before McPhail,
the law stipulated the need for a complete list of beneficiaries for discretionary trusts. However,
McPhail abandoned this requirement in favour of a more straightforward “is or is not” test. The
new test focused on the certainty of determining whether an individual is or is not a member of the
class of beneficiaries, mirroring the test applied to powers.

This article seeks to discuss the decision of the court which shaped the present law of trusts
particularly the test ascertaining objects under discretionary trusts. It seeks to highlight the that
reasoning the courts used in order to arrive at its decision to the effect that it has still been
maintained.

INTRODUCTION

This case was a question under appeal. The appeal concerned the validity of a Trust Deed dated
17th July, 1941 whether on its true construction the provisions of clause 9(a), by which one Bertram
Baden established a fund to provide benefits for the staff of Matthew Hall & Co. Ltd., and their
relatives and dependents, constituted a trust binding the trustees to distribute income in accordance
with its provisions or it was a mere power not imposing any such duty. As the law stood, it
appeared probable that the prospect of success for the appellants upon the question whether the
deed is void for uncertainty were greater.

FACTS

Mr. Bertram Baden established a fund to provide benefits for the staff of Matthew Hall & Co.
Ltd., and their relatives and dependents. The trustees were to distribute income in accordance with
its provisions. Clause 9 of the deed provided:

The trustees shall apply the net income of the fund in making, “at their absolute discretion, grants…
in such amounts at such times and on such conditions (if any) as they think fit…
The trustees shall not be bound to exhaust the income of any year or other period in making such
grants… and any income not so applied shall be… [Placed in a bank or invested].

The trustees may realize any investments representing accumulations of income and apply the
proceeds as though the same were income of the fund and may also… at any time prior to the "
liquidation of the fund realise any other part of the capital of the" fund ... in order to provide
benefits for which the current income" of the fund is insufficient. "

Clause 10 provided that all benefits being at the discretion of the trustees, no person had any
interest in the fund otherwise than pursuant to the exercise of that discretion. Of the preceding
clauses, Clause 6(a) provided that all moneys in the hands of the trustees and not required for the
immediate service of the fund may be placed in a deposit or current account with any bank or
banking house in the name of the trustees or may be invested as hereinafter provided; Clause 7
dealt with the trustees’ power of investment.

The settlor died in April, 1960, and his executors, the appellants, claimed that, the deed being
wholly void, payment of the fund was due to the settlor’s estate. This claim was resisted by those
whose interest it was to establish that, whether there is a trust or a mere power under which they
may benefit, in neither case was the provision which they sought to support void for uncertainty.

HOLDING

The court held that the deed created a discretionary trust and not a power.Lord Wilberforce,
delivering the judgment, asserted that as long as it is clear whether an individual is or is not a
beneficiary, the trust is valid. He rejected the notion of applying an equal division principle to such
discretionary trusts, emphasising that equal division might not align with the settlor's intentions.
Lord Wilberforce highlighted that the court has the flexibility to order different types of execution
based on the circumstances.

SIGNIFICANCE

By the comment of Lord Guest the fundamental distinction between a mere power and a trust
power was given that “The Court, apart from a mala fide (bad faith) exercise of a mere power has
no control over the exercise of the power by the donee or trustees as the ease may be. If it is not
exercised or fails for invalidity the fund goes to those entitled in default, under the settlement or
on a resulting trust as the ease may be. It is very different in the case of a trust power. There the
trustees are under a fiduciary duty to exercise the power. The beneficiaries can compel the trustees
to exercise the power by application to the Court if necessary”

Philip Pettit in Equity and the Law of Trusts observes100 that, the decision by the House of Lords,
by a bare majority, that ‘the test for the validity of a discretionary trust was similar to that accepted
by the House in Re Gulbenkian101 Settlement for powers, that the trust is valid if it can be said with
certainty that any given individual is or is not a member of the class.

After McPhail, in a discretionary trust, the trustee have the discretion to appoint within a class of
potential objects and the trust will fail only if the definition of the class is conceptually uncertain.
Providing the meaning of the words in the trust are sufficiently clear, so it can be said of any given
person whether they would be or not a member of the class, it does not matter if every potential
member cannot be identified by evidence. The test for ascertaining if a person falls within the class
is applied generically rather to a particular person. Therefore the trustee only has to make a survey
of the class and then select the beneficiaries from within that class, which is the same rule that
applies to fiduciary powers of appointment established in Re Gulbenkian. In other words, the
trustee must find the permissible area of selection but that does not mean he has to identify every
single member of that class of objects before making any allocations.

The case is distinguished from I.R.C v. Broadway Cottages102 by the words of lord Wilberforce
when he stated that I.R.C v. Broadway cottages was certainly a case of trust that it was void for
uncertainty since there cannot be equal division among a class unless all the members of the class
are known. However the contention in this case was whether Clause 9 (a) constituted a trust or just
a mere power.

McPhail is a good example of a non-exhaustive discretionary trust where the trustees have the
power to distribute the fund but also to accumulate it; in contrast, to a fixed trust where the shares
and proportions are determined by the settlor when he creates the fund. McPhail established that
all that is required is that it is said with certainty if a given person is or is not a member of a class.

100
Philip P. (2012) Equity and the Law of Trusts, 12 th edition, Oxford university press, London.
101
[1970] AC 508
102
[1955] Ch. 20
CONCLUSION

In conclusion, this case demonstrates how the court was able to exercise its capacity to control a
trust and not render itself helpless by letting such a trust fail. The outcome of this case is of public
interest that trusts of this nature do not fail. The case is the authority for using the ‘is or is not test’
to ascertain the objects to a trust. It is important to sever the holding from being contradictory by
understanding appreciating how it has contributed to the modern law of equity by making the test
for objects under discretionary trusts.
R V DISTRICT AUDITOR OF WEST YORKSHIRE METROPOLITAN CITY COUNCIL
[1986] RVR 24

ABSTRACT

The decision in R v District Auditor of west Yorkshire metropolitan city council103 is an important
case because it shows the position of the law regarding administrative unworkability being
essential for a discretionary trust not to fail. The decision in this case reaffirms the position that a
trust which cannot be realistically carried out is deemed to be void in a discretionary trust. A
discretionary trust is trusts were the trustees have discretion on whether or not to pay any member
of a defined class of beneficiaries.

The article looks at the approach that the court of appeal took regarding the need of a discretionary
trust to be administratively workable for it to be enforceable by the courts. Administrative
workable means that it should be possible to realistically carry out the disposition in a trust. The
terms of the trust included seeking to relieve unemployment in that region, assisting bodies that
worked with young people and the encouragement of better race relations. These objectives and
the broad geographical region and the large number of potential beneficiaries would render the
trust administratively unworkable and that it was consequently void. 104

INTRODUCTION
This case was in the court of appeal where the trust failed because of administrative unworkability.
In this trust the class of beneficiaries was conceptually certain but failed because it would be very
difficult and costly for the courts to enforce. The class of beneficiaries in question involved
approximately two and a half million inhabitants which were entitled to the money left on trust.3

103
[1986] RVR 24
3
104
`optimizing equity , trusts and wills
Ibid
FACTS

The metropolitan county was threatened with abolition by the government. It had a fund of
approximately four hundred thousand euros and decided to create a trust for the benefit of any or
some of the inhabitants of the county of Yorkshire.

HOLDING
It was held that whist the class of beneficiaries was conceptually certain the trust failed for
uncertainty of objects as it administratively unworkable because it had approximately two and a
half beneficiaries.

SIGNIFICANCE
The case highlights the concept administratively unworkability invalidating a discretionary trust.
As seen in the case of Macphail v Doulton105, were Lord Wilberforce said “There may be a case
…. Where the meaning of the words used is not clear but the definition of beneficiaries is so
hopelessly wide as not to form anything like a class that the trust is administratively unworkable”.
This was also addressed by Sir Robert Meggary V-C in Re Hay’s Settlement trusts,106 who
considered that a discretionary trust for all the people in the world except for an excluded class
would be administratively unworkable. This case is important because it gives an understanding
that a class of beneficiaries that is too wide to form a class can be difficult to carry out.

CONCLUSION
The decision of this case is important because it talks about the issues concerning the certainty of
object. A trust with a class that is so hopelessly wide to be considered administratively unworkable
is void. A trust can fail even though the object is certain as seen in this case where the said class
of beneficiaries rain into millions making it difficult and costly for the courts to enforce.

105
[1971] AC 424
106
[1982]1 WLR 202
RE BARLOW’S WILL TRUST [1979] 1 ALL ER 296

ABSTRACT

This case was aimed at clarifying the certainty of words that can amount to a class of beneficiaries.
It also distinguished between gifts where the question of interest varies from the class of
beneficiaries. The decision in this case showed that the gift was valid because any uncertainty
regarding the class of beneficiaries does not affect the share of anyone who can prove that they
qualify.

The case used to manage the distribution of assets according to the instructions given in the will
often provides for the beneficiaries over a certain period under specific instruction.The position of
this writing concerns the certainty of the words “family” and “friends” in a will. It was a gift in
the form of a bequest further in this case the court was on firm ground to state that the disposition
was only valid because it was a gift and there was no requirement to establish all the members of
the class only persons wishing to buy the painting was indeed a friend or family.

INTRODUCTION

This case was a High Court case in 1976 concerning a will trust, where it was held that the trust
was certain enough to be valid. The judge’s decision allowed the disposition to take effect for
those individuals who could prove they met the reasonable criteria for being considered friends or
family of the testatrix.

FACTS

A testatrix by her will, directed her executor to sell her collection of valuable paintings subject to
the provision that any member of my family and any friends of mine be allowed to purchase any
of the paintings at a catalogue price complied in 1970. The executors applied to the court to
ascertain whether the direction was void of uncertainty and for guidance as to the appropriate
method for identifying members of the testatrix’s family.
HOLDING

The court held that the direction as to friends was valid for the properties were to be distributed in
specie and the quantum of the gifts did not vary with class.

Despite the expression friend being conceptually uncertain, the transfer by will amounted to
individual gifts to the persons who satisfied the description. The court also gave guidelines on the
identification of friends namely:

(a) The relationship with the testatrix was required to be long-standing

(b) The relationship must have been social as opposed to the business of professional

When circumstances permitted they met frequently the expression ‘family’ means a blood
relationship with the testatrix.

SIGNIFICANCE

The case highlights the workable meaning on which the words ‘friends’ can be deemed valid to
form a class of beneficiaries. We can also see this in the case of Re Allen , the gift is valid if it is
possible to say of one or more persons that he or they undoubtedly qualifies even though it may
be difficult to say of the others whether or not they qualify.

CONCLUSION

In summation, the ruling in this case demonstrates that a gift does not require one to establish all
members of the class, so long as some people would qualify on any test, the ‘class’ in this case
being friends.
RE WHEELER AND DE ROCHOW CH NO. 315 OF 1896

ABSTRACT

The decision in the case of Re wheeler and De Rochow is important because it clarifies the position
of the law regarding the appointment of a new trustee by the instrument creating the trust, which
in this case the surviving spouse in a trust settlement was empowered to appoint new trustees. This
article dissects the intricacies of the case of Re wheeler and De Rochow where the court of
chancery delved into the essence of trustee-beneficiary relationship, where it recognized it as
infused with fiduciary responsibilities. The position of this piece of writing is that a trustee can
only be appointed on two occasions, on the creation of a new trustee whether inter vivos or by will
and during the continuance of an existing trust, either in replacement of a trustee or as an additional
trustee. Further, the court decided that the trustee being bankrupt did not make him "incapable"
but "unfit" of acting as a trustee, thus the nominee did not have authority to appoint a new trustee
in this case.

INTRODUCTION

The captioned case of Re wheeler and De Rochow, puts a trustee in the spotlight, the power of the
trustees and who in fact is to exercise that power, with reference to section 10 of the Trustee Act
of 1893.

Recall that, a trustee, is the legal owner of the property, who has equitable interest, but does not
enjoy the benefits as the benefits are for the beneficiary.

It was clarified that the statement, “person or persons nominated for the purpose of appointing new
trustees by the instrument creating a trust,” referred to the person or persons nominated for the
purpose of appointing new trustees in the particular event which had occurred as per section 10 of
the Trustees Act of 1893.

Where, therefore, by a marriage settlement, a husband and wife, or the survivor of them were
empowered to appoint new trustees in certain specified events such as where the trustees becomes
incapable but not unfit and one of the trustees became unfit but not incapable.
FACTS

A settlement made on the possible marriage of Mr. A.E. De Rochow with Mrs. E.S. Wheeler, of
which funds were vested in L.M. Wynne, Alfred Dixon, A.L. Wheeler as trustees in a trust deed.
The settlement included a clause which gave the nominee A.E. De Rochow and E.S. Wheeler or
the survivor of them, by deed or deeds, the power to appoint any person or persons to replace a
trustee or trustees respectively for the reason of so dying, desiring to be discharged, or refusing,
declining or becoming incapable to act.

One of the trustees L.M. Wynne became bankrupt and had previously absconded and it was
unknown of where he was. For this reason, the surviving nominee A.E. De Rochow purported in
exercise of the power granted to him by the settlor, to appoint J.T.B. Sewell, to be the new trustee
replacing L.M. Wynne and work conjointly with the two other trustees for the sole purpose of the
trust settlement. However, the beneficiaries wanted to appoint another individual Major General
H.C. Magenis trustee in the place of L.M. Wynne this was as per section 25(1) and 35(1) of the
Trustee Act of 1893.

A. E. De Rochow and J. T. B. Sewell, In the event which had occurred, namely of L. M. Wynne
being unfit to act, the appointment of new trustees was properly made by De Rochow as being the
person nominated for the purpose of appointing new trustees by the instrument creating the trust
within the meaning of section 10 of the Trustee Act of 1893.

HOLDING

The court of Chancery Division, decided that bankruptcy rendered a trustee unfit and not incapable
of acting. Kekewich J based his judgement on the reasoning that, Mr. Wynne (the trustee), if not
by becoming bankrupt was unfit by reason of absconding, he also gave consideration to the
possibility that a settlor could have intended for their surviving spouse (who was the nominee) to
appoint a new trustee only under specified events.

The trust settlement specifically contained the provision for the appointment of a new trustee by
the nominee, when a trustee was found incapable and not unfit. The provision for who was to
appoint a new trustee if a trustee became unfit was provided for under Section 10 of the Trustee
Act of 1893. This meant that seeking to rely on the trust settlement, which only provided for
limited occasions which could give rise to the need to exercise appointment powers of a nominee,
was entirely wrong in this case.

The courts further held that, there was a need for the appointment of a new trustee, but that, the
appointment ought to have been done not by the spouse who was nominated to appoint a new
trustee under the trust settlement but by the continuing trustees as provided for under section 10
of the Trustee Act of 1893.

SIGNIFICANCE

He case points out the events in which a new trustee can be appointed when express power of
appointment has been conferred upon a nominee and who can exercise the power of appointment.
The Court found that the event that occured was not specified in the trust instrument and the
settlement had a nominee who was the right person to exercise the power of appointment.

The court was of the view that the settlement dated March 16, 1864, conferred express power upon
Mr. A. E De Rochow and Mrs. E. S. Wheeler to appoint new trustees in an event that the trustees
or one of them died, desired to be discharged from, or refuse, decline, or become incapable to act
but not in an event that he became unfit. Mohamed Ramjohn, the author of Unlocking Equity and
Trusts107 define incapacity refers to some physical or mental inability to administer the trust
adequately, but does not include bankruptcy and unfitness refers to some defect in the character
of the trustee which suggests an element of risk in leaving the property in the hands of the
individual, for example a conviction for an offense involving dishonesty or bankruptcy. Unfitness
was an event specified in the Act of Parliament but not in the trust instrument. Since the event of
unfitness was not specified in the settlement, it was not lawful for the nominee to exercise his
power on the grounds of unfitness. The question in fact was whether the appointment was to be
made in accordance with the trust instrument or pursuant to the Act of Parliament which is section
10 of the trustees Act of 1893 which highlights unfitness as one of the events that will require
appointment of a new trustee. The case clearly espouses the court's position which is relied on the
case of Re Barkers108 which held that, “ it is the duty of the Court to remove a trustee if he is
bankrupt as a general rule.” However, this will not suffice when the events requiring the

107
Mohamed Ramjohn. (2015) Unlocking Equity and Trusts, 5th ed, Routledge, New York. 418
108
(1920) 1 Ch 527
appointment had not occured. In a similar case of Re Walker v Hughes,109 it was held that “ the
husband and wife were the proper people to appoint a new trustee where there was a declaration
conferring such power upon them.”

It further held that a new trustee could not be appointed as the event stipulated had not occured.
Therefore, when special express power (special authority) has been conferred upon a nominee to
appoint a new trustee, only that nominee has the power to exercise that power and will only
exercise it in accordance with the events specified in the trust instrument.

CONCLUSION

The courts decision in this case is of utmost importance because it brings to light the events that
could lead to the appointment of a new trustee, and who is entitled to exercise the power of
appointment in accordance with the provisions of the settlement and the law. The ruling in this
case firmly stipulates that where a trust settlement specifies events that could give power to the
nominee of the settlement to appoint new trustees and an event occurred that was not provided for
that, then the continuing trustees as provided for under the law were the ones to appoint a new
trustee. The decision reaffirms the rule of equity to fulfill a settler's intention rather than imposing
the rules in an Act of Parliament which maybe against the settler's intention.

109
C.A. No. 20455 (Del. Ch. Feb. 7, 2005)
SAUNDERS V VAUTIER (1841) 4 BEAV 115

ABSTRACT

The case of Saunders v Vautier is an important case in the legal system that puts more emphasis
on the law regarding trusts. The decision in this case clarifies the right of a sole beneficiary to
terminate the trust prior to the date stipulated in the trust.

This piece of writing aims at the approach the court of appeal took regarding the termination of a
trust prior to the date stipulated in the trust by a sole beneficiary. It seeks to put clarity on the
termination of the trust prior to the date stipulated in the trust by the beneficiary.

This piece of writing puts focus on the principle that where the beneficiary has an absolute,
indefeasible interest in a trust and is of adult age and sound mind, then he or she, being the sole
beneficiary may request for the trust to be terminated and for the trustee to transfer the legal estate
before the stipulated date in the trust. This principle is applicable in trusts where there is a sole
beneficiary and cases where there is absolute consent by all the beneficiaries in a trust, it enables
the beneficiaries to terminate and transfer their beneficial interest under a trust.

INTRODUCTION

In this case, the court was tasked with determining whether the beneficiaries of a trust could
terminate the trust and demand distribution of the trust property. This case established the principle
known as the rule in Saunders v Vautier, which allows beneficiaries who are collectively entitled
to the entirely of the property to terminate the trust, even if it goes against the wishes of the settlor.
The decision in this case has had a lasting impact on trust law, particularly in the area of
beneficiaries’ rights and settlor’s intention.

FACTS

A testator, Richard Wright had bequeathed $2000 worth of stock in the east India company on
trust for his great nephew, Daniel Vautier, who shared the same name as his father, it was to
accumulate interest and dividends with time, until he reached the age of 25. The terms of the trust
instructed the trustee to transfer the stock to the nephew upon him reaching the age of 25.

Later on, Daniel Vautier (the father) died and his widow Susannah who was left to hold the estate
on trust on behalf of Daniel Vautier (the son), sued for lack of maintenance for Daniel during his
minority age, by the trustees nominated by the testator John Saunders and Thomas Saunders.
Thereafter, by an order from the court, Daniel was rightfully maintained.

Daniel Vautier then turned 21, which was the age of the majority at that time. He was about to
marry and wanted to establish a business, he presented a petition for the trustees to be ordered to
transfer to him the East Indian stock or for it to be sold and the proceeds transferred to him after,
thus he wanted the trust to be terminated

HOLDING

The court stipulated the rule that, where the beneficiary has an absolute, indefeasible interest in a
trust, and is of an adult age and of sound mind, then the sole beneficiary may require the trust to
be terminated and trustee to transfer the legal estate before the date stipulated in the terms of the
trust.

The court propounded the principle that a sole beneficiary, or an absolute consent of all
beneficiaries to a trust , enables the beneficiary to terminate or transfer their beneficial interest
under a trust. Thus, although it may be contrary to the intentions of the testator, who wanted for
the value of the stock to accrue interest for a longer period. The son, as the sole beneficiary, was
not bound to wait until the age of twenty-five and was able to require payment and divest the stock
at the earlier age of twenty-one against the terms of the trust.

It endorses the principle of equity by allowing the beneficiaries to exercise their rights when they
are legally capable of doing so and sets a balanced approach, honouring self-sufficiency of the
beneficiaries while respecting the intentions of the settlor.

SIGNIFICANCE

Saunders v Vautier significantly empowers beneficiaries by recognizing their right to terminate a

trust if they are of full legal capacity that is when he or she gets to a legal age. This case established
the principle that beneficiaries are not bound by the terms of the trust indefinitely, they can assert
their right to immediate enjoyment of the trust property under certain conditions and that is if they
are of legal age and sound mind and also the court may consider the reason why a certain
beneficiary wants to terminate a trust. Because of the principal that the court raised for the case, it
has become a binding precedent, for instance in the case of Re Smith,110 where the court applied
the principle of Saunders v Vautier to allow adult beneficiaries to terminate a trust despite the
settlor’s intention for the trust to continue.

Similarly, in the case of Gosling v. Gosling111 the court upheld the beneficiaries’ right to terminate
a trust in accordance with the rule in Saunders v Vautier. Furthermore, the case of Saunders v.
Vautier highlights the flexibility of trust law in accommodating the intentions of the settlor and
the interests of the beneficiaries112. By allowing beneficiaries to terminate the trust and receive
their shares, the court ensures that the trust property is put to its intended use in accordance with
the beneficiaries’ wishes.

As a leading authority on beneficiaries’ rights, Saunders v Vautier has provided guidance to courts
in interpreting and applying trust law principles in a wide range of contexts, and has brought about
equity to the beneficiaries who are entitled to the trust properties by applying the rule of variation
of the trust113. In that by the discretionary decision of the court, the beneficiary may be given the
properties, provided the he she wants to use the trust properties as suggested in the trust instrument,
if even not reaching the actual age that the Settlor had stated in the deed. Which construed that,
court will look beyond the original form of how it was stated and bring about equity in order to
put the beneficiary in good terms.

CONCLUSION

The decision made in this case is very important concerning the termination of a trust by a sole
beneficiary or consenting beneficiaries, before the stipulated date in the trust that was intended by
the testator. This decision established the rule in Saunders v Vautier has brought to light, the fact
that, beneficiaries who have attained the age of majority and are of sound mind, cannot be bound
by the date stipulated in the trust. This meant that for as long as the beneficiaries have attained the
age of majority and are sound mind during the termination, then the court has no issue with
terminating the trust prior to the date stipulated in the trust.

110
(1928) Ch 915
111
(1985) Ch 270
112
www.legalilluam.com
113
www.lawScholar.com
HEAD V GOULD (1898) 2 CH 250

ABSTRACT

The decision made by J Kekewich in the case of the Head v Gould is an important decision as it
clarifies the exception to the general principle of equal liability in the breach of trust involving a
solicitor as one of the trustees. The decision in this case reaffirms the position that it would unjust
where one trustee is a solicitor and takes on a controlling influence over the trust and breach the
trust and other trustee become liable too, unless, there was contribution to the breach.

This article looks at the approach Kekewich J took regarding the exception made from the general
principle of equal liability in respect of trust been breached. Therefore, this article seeks to give
more clarity on the issue pertaining breach of trust committed on the advice of a solicitor.

The position of this piece of writing is that breach of trust is failure to comply with duties laid
upon trustee by the trust instrument and also by equity. And there is enough evidence whether
there is breach of trust, because some properties will be tempered.

INTRODUCTION

This was a case in English trust law concerned with the indemnity of trustee inter se for a breach
of a trust where a trustee has committed a breach of trust relying on the professional advice of a
solicitor trustee. They were entitled to be indemnified by virtue of that reliance. It is one of the few
common law situations concerning inter-trustee indemnity that is still thought of applying in civil
jurisdiction. The addition requirements to the breach of the trust espoused in the case of Re
Partington114 are; a co-trustee is a solicitor, breach of trust was committed in respect to his advice
and the co-trustees had relied solely on his advice and did not exercise an independent judgment.

FACTS

Miss Head and Mrs. Gould were appointed trustees of marriage settlements, Mrs. Gould was a
solicitor-trustee. The trustee sold the house that was part of the trust property and in breach of trust
paid the proceeds of the sale to a life tenant. On the other hand, Miss Head sought to claim that
she was indemnified because of the status of her co-trustee as a solicitor. Miss Head claimed that
she had acted in reliance on the professional advice of Gould.

114
(1887) 57 LT 654
HOLDING

In this case after investigations there was evidence that the co-trustee that is Miss Head actively
encouraged Mrs. Gould’s advice that caused the breach of trust and so Miss Head’s claim for
indemnity was declined. However, in giving judgment by J. Kekewich, he stated that “I don’t think
that a man is bound to indemnify his co-trustee against any loss merely because he was a solicitor,
when that co-trustee was an active participator in the breach of trust complained of, and is not
proved to have participated merely in consequence of the advice and control of the solicitor.

SIGNIFICANCE

Since the decision in the case of Head v Gould is one of exception to the general rule which state
that if there are two or more trustees in the trust, trustee are equally liable for the breach of trusts
when they could have prevented those breaches. So, they are expected to act jointly, and where
they don’t act jointly, any passive trustee will still be held liable because they should have involved
themselves in decision making, managing the investments in relation to the trust and supervising
what their other co-trustees were doing. Therefore, the decision in Head v Gould aim to indemnify
other co-trustees if any in the event of breach of trust, if they did not contribute to the breach nor
encourage the advice from the solicitor115.

Judith Riches in the book of optimize equity and trusts, stated that “trustee’s liability is personal
which means that he is not normally liable for a breach of trust by a co-trustee unless he was also
at fault, for example, if he stood by without acting when he knew that a breach was taking place,
or if he permitted trust funds to remain in the sole control of a co-trustee”116.

It is also stated in the book of Trusts and Equity by Richard Edward and Nigel Stockwell that
trustees are not vicariously liable for each other’s breaches of trust. However, trustees are required
to act jointly and any trustee who leaves the administration of the trust to others does so at his
peril. If a breach of trust is committed, prima facie it is a breach by all the trustee117. Has it was
stated in case of Re Flower118, that the duty of trustees is to prevent one of themselves having the
exclusive control over the trust properties.

115
www.studocu.com
116
Judith Riches, Optimize Equity and Trusts. 2nd Edition, page 280. Routledge (2017)
117
Richard Edward and Nigel Stockwell, Trusts and Equity 9 th edition, page 438. Pearson longman (2009)
118
(1884) 27 ch D 592
It also a general principle that a retiring trustee remains liable for breach of the trust committed
while he was a trustee. He is absolved from liability in respect of subsequent breaches, unless he
retired in order to facilitate a breach of trust as per the case Head v Goud.

The rule in the case of chillingworth v Chamber119, state that where one of the trustees is in
breach of trust is a beneficiary of the trust and intended to profit by the breach, the trustee-
beneficiary must indemnify the other trustee s to the extent of his beneficial interest. It is also a
rule in Re Dacre120, where a trustee-beneficiary was in breach of trust and he cannot receive any
benefit unless the loss is made good. This, combine with the rule in chillingworth v chambers,
which means that the trustee-beneficiary’s interest must be first used in meeting the claim of the
estate.

Where there is a passive and active trustees, and all of them are sued the passive ones are not
entitled to an indemnity from the active ones, remembering that passive trustees are equally liable
with active ones if they permitted the breach as per the case of Bahin v Hughes121, where both
passive and active trustees were equally liable and the passive was not entitled to be indemnified
by the active one.

CONCLUSION

The decision in this matter is very important because it brings to the fore issue pertaining the
breach of trusts involving more than one trustee. The decision has brought to the fore the fact that
breach of trust involving two or more trustees, not all trustees will be liable if that co-trustee didn’t
contribute or make personal gain from the breach. The decision reaffirms the exception to the
general principle which state that trustees are equally liable for breach of trusts when they could
have prevented those breaches.

119
(1896) 1 ch 685
120
(1916) 1 ch 344
121
(1886) 31 ch D 390
ROBINSON V PETT [1734] 24 ER 1049

ABSTRACT

The remarks made by lord chancery Talbot in the High Court of chancery, on the first of January
1734 in the case of Robinson v Pett is an important decision as it clarifies the rule in the creation
of trust, that a trustee or executor shall have no allowance for his care, trouble. And that one is
entitled to refuse to act as a trustee as per Lord Talbot. Allowing compensation could potentially
damage the trust estate rendering it of little value and it might be difficult to determine the amount
of allowance. Therefore, in this context, the court maintained a stance against remuneration for
trustee’s time and trouble, emphasizing the importance of protecting beneficiaries’ interests while
ensuring effective trust administration. We can get our knowledge from the case of Brudenell-
Bruce v Moore and ors that took place in 2014, were it was held that lay trustees are not entitled
to remuneration.

INTRODUCTION

This was the case in the court of chancery before lord Talbot, in which the appellant {Mr. Pett}
renounced his position of executor but continued assisting in the management of the trust. And
later on, claimed additional compensation for his time, effort, and expenses related to managing
the trust.

FACTS

The plaintiffs (beneficiaries) brought a legal action against the executors, seeking an account of
the personal estate. Then Pett claimed his legacy of 100 pounds as provided in the will. However,
he also asserted that he deserved an additional 400 pounds for his extraordinary efforts, time, and
troubles in handling the testator`s affairs. Pett had diligently worked on complex matters including
reconciling intricate accounts and collecting difficult debts. Interestingly, despite benefiting the
testator`s estate, Pett had also suffered some prejudice to his own affairs.

HOLDING

The court held that. It would never allow an executor or trustee to be compensated for their own
time and effort. Even if an executor renounces their position, yet continues to assist in the
executorship, the situation remains unchanged. This principle applies even when the executor or
trustee has benefited the trust to the detriment of their own interests.

SIGNIFICANCE

With regards to the case of Robinson v Pett, the judgement in the case brings out a very important
decision to say that a trustee is not surposed to be paid for all the troubles and time and efforts in
managing the trust property, as also seen in the case of Kambindima Wotela v Standard Chartered
Bank Zambia plc, where the court held that a trustee is not surpassed to benefit from the trust
property as it would diminish the value of the trust property. The general rule under the present
law is that trustees should not be paid for acting as such. This rule is founded on the principle that
trustees are not allowed to derive any benefit from trust property and that to allow them to be paid
might give rise to conflicts of interest and duty. In the case of lay trustees (someone who acts
outside of a professional capacity and is not a trust corporation, the case of Brudenell Bruce v
Moore and Others [2014] reaffirmed the above position. As such it is now widely accepted that
lay trustees are generally not entitled to remuneration for their services. This is the significance
that can be drawn from the case of Robinson v Pett.

CONCLUTION

Executors or trustees are not entitled to compensation for their time and effort, regardless of
whether they renounce their position or continue to assist in the administration of the estate. The
court aimed to prevent overburdening the trust estate and avoid difficulties in determining the
quantum of such allowances.
RE STONEHAM’S SETTLEMENT TRUST

ABSTRACT

The decision in the case of Re Stoneham settlement trust122 is an important decision because it
clarifies the importance of the law regarding the way in which a trustee may be removed from
office, in that it clearly states that trustees could force his removal and he could play no part in
appointing his successor.

The removal of the trustee will be appropriate when the continuance of the trustee would prevent
the trust being properly executed

INTRODUCTION

This was an appeal in the in the courts of chancery of the high court

FACTS

The trustee of the trust had been abroad for over 12 months and was unwilling to resign

According to the genuine interpretation of s.36(1) of the Trustee Act 1925, a trustee may be
dismissed against his will if he has been outside the UK for more than 12 months. A trust that has
been removed due to a trustee’s repeated absence from the UK for longer than a year is not entitled
to demand that he be involved in the appointment of the new trustee or trustees because a removed
trustee is not, in the sense of s.36(1) of the Act, a refusing or retiring trustee. By means of two
appointments pertaining to a will and a settlement, C, one of the trustees, was designated as a
trustee by two plaintiffs123

HOLDING

The courts held the other trustees could force his removal and he could play no part in appointing
his successor.

122
(1953) CH 59
123
https://quizlet.com/31911132/trusts-14-appointment-retirement-removal-of-trustees-cases-flash-cards
SIGNIFICANCE

The case of Re Stoneham’s settlement trust is a landmark case, for it elaborates and establishes
ways in which a trustee can be removed. A trustee may be removed from office in one of the
following four (4) ways.

By virtue of the power contained within the trust document, with special power that allows certain
circumstances to trigger the removal of the current trustee and the appointment of a new one.

The court has the jurisdiction to remove an existing trustee and appoint a replacement trustee, and
appoint a replacement trustee under its inherent jurisdiction to the secure the proper administration
of the trust. The court has the power to remove a trustee without appointing a replacement trustee.

Re Stoneham’s Settlement trust (1953) if a trustee remains out of the city for more than twelve
months, or is unfit to act, or refuses to act, or is incapable of acting, he can be removed and replaced
by the court.

Letterstedt v Broers, indicates that a trustee can be removed if the beneficiaries are not happy, the
trustee may be competent and of sound mind, but the court looks at the welfare of the beneficiary.

CONCLUSION

In conclusion this case clearly stipulates circumstances under which a trustee can be removed and
it ascertains the fact that whether or not a trustee is willing to resign, they can be removed as stated
in section 36(1) of the trustee Act of 1925 if they have been outside the country for more than
twelve months.

This is advantageous in the sense that it promotes the effectiveness and the efficient running of a
trust by removing inactive trustees for the benefit of the beneficiary.
LETTERSTEDT V BROERS [1884] UKPC 1

ABSTRACT

The decision in the case of letteredt v brokers is an important decision because it clarifies the
importance of the law regarding the guidance to when a trustee can be removed the main guide is
the welfare of the beneficiaries

Removal of the trustee will be appropriate when the continuance of the trustee would prevent the
trust being property executed

A trustee is the legal owner of the property who holds property for the settler for the benefit of the
beneficiary essence of this piece of writing is that

INTRODUCTION

This was an appeal against the ruling of the supreme court of cape of good hope, the Appellant,
managed to prove a claim to “her legitimate portion” in the time between the compromise and the
start of this lawsuit.

FACTS

The Appellant is the only daughter of Jacob letterstedt Jacob letterstedt her father died on the 10
march 1862 leaving a will.

The testator operated a malting and brewing business at two locations, Mariedahl and Cape Town,
during his lifetime. He stipulated in his will that this business would continue after his death in the
same manner that it was conducted by him, and that his executors would provide an amount of
money sufficient to fund it, not to exceed $10,000. David Thompson is named manager of
Mariedahl by him.

Additionally, the testator and Per Oscar Hedelius continued to operate a business together at the
time of his death under the name Jacob Letterstedt & Co.

There won’t be a son like that in ease; instead, the boy will belong to and become a part of my
general estate. This is significant because it demonstrates that some, if not all, of the trusts that the
executors were to administer did not expire when the appellant turned twenty-five.
The three executors—Oscar Hedelius, who passed away in 1863, Tobias Spengler, who passed
away in 1866—proved the will on May 19, 1862.The testator expressly granted his executors the
authority of assumption, substitution, and surrogation; therefore, in 1866, the Board served as the
only executors and trustees under the terms of the will. No new executors were chosen under these
powers.

The mother of the appellant, Madame Lydia de Jouvencel, was named co-guardian in her son’s
room by the guardians on April 11, 1872, after one of the guardians quit. The other guardians quit
in October 1872, leaving Madame Jouvencel as the only one remaining.

In the interim between the compromise and the initiation of this action, the appellant was
successful in proving her entitlement to “her legitimate portion.” By the nineteenth paragraph, she
accuses the Board of numerous misdemeanors and violations. However, their Lordships believe
that the lower court correctly concluded that the compromise could not be interpreted in such a
restrictive way, especially when it came to the first and third articles. For this reason, they believe
that the first paragraph of the ruling from July 11, 1879, was correct. There are no complaints about
the third or fourth paragraphs.

The executors opposed, making the referee unable to act. As a result, the Plaintiff approached the
Court in the manner specified in the following order. The Plaintiff had asked the referee to decide
that question. After verifying the referee’s final report, the final judgment dated July 2, 1881,
orders “that the prayer for the removal of executors be refused, Plaintiff to have her costs out of
the estate up to the first hearing.” The curator's expenses should be deducted from the estate. The
aforementioned Board has misused and betrayed its trust as executors by applying and spending
substantial sums of money from the said estate for the construction of buildings, machinery, and
landed property. The Plaintiff also claims that the Board is no longer appropriate or fit to be
entrusted with the administration of the said estate, and that it has given up its right to continue
serving as executors under the said will as a result of the aforementioned acts of misconduct and
malversation as well as other matters and things he previously mentioned. The Plaintiff cannot
now claim that the executors' basic responsibilities—such as collecting assets, paying debts, and
other duties—weren’t fulfilled because those tasks were completed long ago in accordance with
the conditions of the agreement. According to their Lordships, a Court of Equity’s ability to
exercise jurisdiction in the manner described by Story appears to be incidental to its primary
responsibility of ensuring that the trusts are carried out correctly. It is important to remember that
the trustees serve the interests of the people to whom the trust’s creator has granted the trust estate.
Their Lordships are cautious when enforcing a sensitive jurisdiction like the removal of trustees
and do not dare establish any broad guidelines. Beyond the very general tenet that the beneficiaries’
welfare must be their primary concern. He designated a trio of executors. The parameters of the
compromise prevented the plaintiff from treating the outcome of the trust violations as such, and
instead of undoing everything and taking responsibility, she chose to embrace them and accept the
situation as it was for her advantage. The Defendants are equally bound by the settlement to the
extent that they acknowledge that they have taken a significant amount of money that exceeds their
entitlements. The final portion of the third head, while, as previously stated, it cannot be considered
proven false with regard to events occurring prior to 1873, is unquestionably unproven and of a
kind that should not be taken at face value in the absence of evidence. The executors at the Bar
have been accused of misleading and acting in bad faith due to the way the prohibited charges for
commission were entered into the accounts. Therefore, the nature of the taxation fees is quite
obvious; nonetheless, they are not validated. Nevertheless, whether they agree or not, they should
no longer serve as trustees for the benefit of the trust. All that’s left to do is settle the appeals
expenses. The expenses of this appeal should come from the estate of Mr. Giddy, the nominal
respondent designated by the court to represent the interests of the reversioners.

HOLDING

The holding of this case was that the court could not find any misconduct by the trustees but the
dispute had affected the functioning of the trust, so ordered the trustees’ removal. The court
produced some guidance about when a trustee can be removed.

The court’s main guide is the welfare of the beneficiaries, in cases of positive misconduct the
court will have no difficulty in removing trustees who have abused their trust. Where trustees are
merely that is not enough to remove them, trustees must breach the confidence that comes with a
fiduciary relationship. Removal of trustees will be appropriate when the continuance of the trustee
would prevent the trust being poorly executed.

Hostility between trustees and beneficiaries is not of itself a reason for the of trustees-it must go
beyond this (as in this case).
SIGNIFICANCE

The case highlights the jurisdiction of the court on the removal of a trustee and guidance regarding
courts powers to remove a trustee, the case sets out the ways in which the courts go about the
removal of a trustee. The court’s main guide is the welfare of the beneficiaries. In cases of positive
misconduct, the court will have no difficulty in removing trustees who have abused their trust. The
court established in this case that where trustees are merely incompetent that is enough to remove
them, trustees must breach the confidence that comes with a fiduciary relationship.

Removal of a trustee will be appropriate when the continuance of the trustee would prevent the
truth being properly executed. Hostility between trustees and beneficiaries is not a reason for the
removal of trustees it must go beyond that as can be seen in this case.

This case is most significant in the sense that it gives fixed steps and factors that the courts should
consider during the removal of a trustee, with reference to the case of Re Stoneham124 in which
the trustee of a trust had been abroad for over twelve months, and had refused to resign and the
court held that the other trustees could force his removal and he could not play a part in appointing
his successor.

CONCLUSION

The ruling rendered by the Supreme Court on July 11, 1879, stands. The Supreme Court's order
from September 14, 1880, is modified, and the motion is denied with no expenses awarded to
either side. Once the last-mentioned portion of the testator's inheritance has been determined, the
Supreme Court is instructed to act in a just and proper manner.

124
(1953) Ch 59, Ch D
LEOROYD V WHITELEY [1887] UKHL 1

ABSTRACT

Throughout the administration of a trust the trustee is required to exhibit objective standard of
skills as would be expected from an ordinary prudent man of business. In the case of a power of
investment, the duty would be exercised so as to yield the best return for all the beneficiaries,
judged in relation to the risks inherent in the investments and the prospects of the yield of income
and capital appreciation. The classical statement of the rule was laid down by Lord Watson in
Learoyd v Whiteley (1887) 12 AC 727. As a general rule on what the law requires of a trustee on
higher degree of diligence in the execution of his office than a man of ordinary prudence would
exercise in the management of his own private affairs.

The court will have regard to all the circumstance of each case in order to ascertain whether the
trustees’ conduct fell below the standard imposed on such persons.

INTRODUCTION

In considering the investment policy of the trust, the trustees are required to put on one side their
own personal interest and views, as they may have strongly held social or political views. The may
be firmly opposed to any such investments in companies connected with alcohol, drugs e.t.c. in
the conduct of their own affairs, trustees are free to abstain from making any such investments.
However, in performance of their fiduciary duties, if investments of the morally reprehensible type
would be more beneficial to the beneficiaries than other investments, the trustees must not refrain
from making the investments by reason of the views that they hold. Trustees may even act
dishonestly (though not illegally), such as accepting a subsequent higher offer for the sale of trust
property, if the interests of their beneficiaries require it. This case sets the standard on how trustees
should conduct themselves with regards to the duty of investment and bearing in mind their duty
of care. It currently acts as a precedent for similar cases.

FACTS

Benjamin Whiteley's executors were sued by Elizabeth Whiteley and her kids on March 19, 1874.
The funds of the will were to be invested in specified securities, such as "real securities in England
or Wales," this was according to the will, which contained a power of investment. Of the trust

142
funds, £5,000 had been misplaced. A ten-acre brick field at Pontefract, "with the engine-house,
sheds, brick and pipe kilns, and buildings thereon, and all fixtures and fittings thereon," was
mortgaged for £3000 with a 5% return.

A total of £2000 was put toward five-percent mortgages on four modest freehold homes in Salford,
Lancashire, one of which was a shop. In October 1884, the proprietors of Brickfield fell bankrupt,
and the owner of the four properties filed a petition for liquidation as there wasn't enough money
to cover the trust.

HOLDING

Bacon VC held in the Chancery Court that the brickfield investment was unauthorized, and the
trustees were responsible for its failure. The trustees failed to exercise sufficient caution, but they
had done so in the case of the houses.

The trustees decided to Appeal the decision of Sir Bacon, but the Court of Appeal maintained the
ruling of Bacon VC, which held the trustees accountable for paying back the £3000 they had
invested in the brickfield. They maintained that, in addition to using any specialized expertise he
may possess, a trustee must use the same level of caution and standard of care of an ordinary
prudent businessman.

The text discusses the investment of £3000 on a brickfield, arguing that it was not a real security
within the meaning of the power. A freehold brick-field would be a real security if the value of the
land, apart from the specific trade carried on, was sufficient to secure the sum advanced. However,
when the value of the land is not the sum advanced, the value of the brickfield as a security for
money lent on it exceeds the value of the land as land. The value of such a security depends on the
trade of brick-making, the probability of a purchaser being found to buy and work the brick-field,
and the profits made by selling bricks made in the field. The text also states that a security of such
a hazardous nature is not a proper security for trust money and is not a real security for any sum
beyond the value of the land as land.

143
SIGNIFICANCE

Lindley LJ equally stated that the principle applicable to cases of this description was stated by late
Master of the Rolls in Speight v Gaunt 125, that a trustee should conduct the business of a trust in
the same manner as an ordinary prudent man would, with no liability or obligation beyond that.
However, the duty of a trustee should not be limited to the present income, but also to invest money
for future benefit. The duty of a trustee should be as cared for as an ordinary prudent man would
take if making an investment for others, for whom they feel morally, bound to provide. And unless
this is borne in mind the standard of a trustee's duty will be fixed too low; lower than it has ever
yet been fixed, and lower certainly than the House of Lords or this Court endeavored to fix it in
Speight v Gaunt126.

The trustees made two investments, despite their bona fide actions and the advice of competent
solicitors and valuers. The trustees argued that this alone exonerated them from liability. However,
this argument goes too far, as the Court would decide that trustees could delegate their trust to
competent persons and terminate their responsibility. However, trustees cannot do this, as they
must act with prudence when acting on advice given to them.

Whilst on the one hand the Court ought not to encourage laxity and want of care, on the other hand
the Court ought not to prevent people from becoming trustees by converting honest trustees into
insurers of the moneys committed to their care. I have endeavored to avoid both errors.

CONCLUSION

This case basically highlights the duty of a trustee to take caution when making investment as he
will be held liable for whatever the outcome. In as much as a Trustee has the power to invest, it is
also important to consider the disadvantages and advantages of that investment. It is very important
for the trustee to do a back-ground check on the kind of business he intends to invest in. The
general rule in this case was that lord Blackburn, trustees sufficiently discharges his duty if he
takes in managing trust affairs and all those precautions which an ordinary prudent business man
would do. The duty of the trustee is not to take such care only as a prudent man would take if he
had only himself to consider, the duty is rather to take such care as an ordinary prudent man would

125
Speight v Gaunt (1882) 22 Ch D 727, 739
126
IBID

144
take if he were minded to make an investment for the benefit of other people for whom he felt
morally bound to provide

According to Cotton LJ, trustees must conduct their business with caution, considering not only
the interests of those entitled to the income but also those who will take it in the future. They must
preserve the money for those entitled to the corpus in remainder and invest it in a way that will
produce a reasonable income for those enjoying the present income. They must use standard of
care as a reasonably prudent man would with similar transactions. A trustee is not required to have
special knowledge, but should consult with lawyers and experts in legal matters and property
value. However, the trustee should be treated as an ordinary man of ordinary intelligence. The
trustees' actions regarding the investment on the brick-field should be examined.

145
SPEIGHT V GAUNT [1883] UKHL 1
ABSTRACT

The verdict in Speight v Gaunt aims on outlining the investment power and the extent of duty of
care by a fiduciary and the power to delegate. The judgement is important because it clarifies the
position of law towards the extent at which the trustee is able to invest trust funds and how he may
delegate his power if he doesn’t have the expertise to perform certain duties.

This article looks at the duty of care for trustee in trust funds in relation to investment. It is common
to refer it to the duty of ‘prudence’ or to be ‘prudent’ or to be a ‘prudent person’. It is clear to say
that the duty of care, or skill and care applies to the trustee in relation to its investment powers.
This is in addition to and should be considered as separate from the other duties and limits on the
investment power. The duty of care is separate from those other duties, although the ambit of those
other duties will inform the scope and extent of the duty of care.

The main objective of this academic script looks at the approach the courts of law took to determine
whether the trustee was liable or if the trustee ought to conduct the business of the trust in the same
manner that an ordinary prudent man of business would conduct his own.

INTRODUCTION

This case was an appeal from the decision of the Vice-Chancellor Bacon who found Mr. Gaunt
liable for the loss of £15,000. The issue that arises in this case is whether Mr. Gaunt, as a trustee,
was liable for the loss of £15,000, due to the failure of the stockbroker, Mr. Cooke, to make
investment on behalf of the trust fund.

The general rules are that; a trustee is required to take due care and diligence when managing the
trust fund, trustees are not liable for the loss incurred when acting in good faith, employing agents
of good repute and following common business practices and that trustees cannot delegate their
trust responsibilities but they are not required to guarantee the solvency or honesty of agents they
employ.

Hence the duty now lay on the Courts to determine where or not the dishonesty of a third party
would amount to the trustee being liable for a breach of duty.

146
FACTS

Mr. John Speight, a Bradford businessman, had named Mr. Isaac Gaunt and Mr. Alfred Wilkinson
as trustees for his estate in his will. John Cooke, a young broker, was hired by the trustees to
convert £15,000 from the estate into stock in the company. The trustees transferred the funds.
While providing justifications for the delays in obtaining the company's shares, the broker
deceitfully kept the money for himself. The facts came to light only after Cooke was pronounced
bankrupt. Speight's trust beneficiaries filed a legal action against Mr. Gaunt, alleging that he
breached his fiduciary duty.

HOLDING

Sir George Jessel MR ruled that a trustee is not liable to make up for the loss caused by the
embezzlement of trust moneys by a broker. He stated that a trustee should conduct the business of
the trust in the same manner as an ordinary prudent man of business would, and that there is no
obligation on the trustee to adopt further or better precautions than an ordinary prudent man of
business would.

When making an investment, the ordinary course of business involves selecting a stockbroker in
good credit and position, directing them to make the investment, and then entering into a contract
for the next account-day. The purchasing stockbroker requests the principal to pay the money, and
the securities are perfected after payment. If the securities are shares or stock in a company, it may
take several days before the transfers are lodged at the office.

In all cases, except for consols and a few other stocks, there is an interval between the payment of
the purchase-money and the obtaining of the security or investment purchased.

Lindley LJ and Bowen LJ gave concurring judgments.

HOUSE OF LORDS

The House of Lords upheld the Court of Appeal. Lord Blackburn had the following to say;

The late Master of the Rolls emphasized that a trustee should take the same precautions as an
ordinary prudent man of business in managing trust affairs. However, a trustee must not choose
investments outside the terms of their trust, even if they are similar to their own investments. This
breach of trust occurs when a person instructs an agent to invest their money, depositing the money

147
at interest until the investment is found, which is considered a breach of trust. The case of Ex parte
Belchier established that a trustee is justified in following a usual course of business, even if there
is a risk of property loss due to the agent's dishonesty or insolvency.

Without a certain degree of confidence, life's transactions could not proceed. It would be
inconvenient in any case for the vendor and the purchaser to have to meet in person in order to
exchange one for the other when the transaction involves a sale where the vendor is entitled to
hold onto the property until he receives the money and the purchaser is entitled to keep his money
until he gets the property; in addition, it would be physically impossible when the parties are, as is
frequently the case, living distant from one another.

Businessmen essentially determine the extent to which confidence can be securely placed, or
rather, if the difficulty and disruption of trade that this confidence prevents is too great a premium
for insurance against the risk thus assumed. They surely reconsider all of this when a loss like the
one that happened in Ex parte Belchier results from having placed such trust in someone; and when
a new practice emerges, as it has done in recent memory, like making bankers' checks payable to
order and crossing them, it is undoubtedly used frequently to avoid taking that risk, which was
previously all but inevitable. In order for what was formerly the standard course of events to
suddenly become unusual.

SIGNIFICANCE

In the case of Speight v. Gaunt [1883] UKHL 1, the House of Lords provided a significant
clarification the duties of a trustee, particularly concerning the duty of care and prudence in
managing the trust assets. It was held that the trustee (Mr. Gaunt) acted in the ordinary course of
business, he was not liable to make good the loss caused by the broker’s embezzlement of the trust
funds. The key part of the judgment in this case emphasized the following principles;

Standard of Care: Trustees should act like an ordinary prudent business person would in
managing trust assets;

No Extraordinary Obligations: Trustees need not take more precautions than what is reasonable
in the ordinary course of business.

148
 Reasonable Precautions: Trustees should adopt usual precautions when making investments,
such as selecting reputable stockbrokers.

When judges and lawyers hear scenarios involving losses rather than the countless instances when
costs, challenges, and inconveniences are avoided, they may assume that the individuals involved
are acting rashly in their commercial dealings. The concept laid forth by Lord Hardwicke seems
to be that, even when a trustee follows the normal course, he should not be held accountable if he
does it honestly and without knowledge of any circumstances that make it particularly problematic.
And this is, in my opinion, based on principles, regardless of Lord Hardwicke's great authority.
Holding a trustee accountable for not exercising greater caution than regular businessmen would
be both illogical and inefficient. This case has set the precedent as when looking at the standard of
duty of care and breach of that duty by the trustee.

CONCLUSION

In a case where the Trustee cannot perform a particular function, for instance, he is not good at
accounting, he may wish to appoint or employ an accountant in order to make accounts for trust
fund for accountability and transparency sake. This would be done in good faith of the Trust and
for the benefit of the beneficiaries. So long he does what an ordinary prudent business man would
do with regards to the trust property. This is equally seen in the case of SPEIGHT V GAUNT,
which can be contrasted from the case of FRY V TAPSON127 (1884), where the trustees had
delegated the choice of a valuer to a solicitor. In this case, the choosing of valuers was not a normal
business function of a solicitor, so the trustees were held liable. Therefore, if the action of the
trustee is that which a prudent business man would do then they would not be liable for the loss or
results of what happens. Further more in the case of Morley v Morley128, where, a trust fund was
the victim of a robbery, and £40 of gold was taken and Lord Nottingham LC held that a trustee
could not be liable if £40 of the trust fund's gold was robbed, so long as he otherwise performed
his duties.

127
Fry v Tapson (1884) 28 Ch D 268
128
Morley v Morley (1678) 22 ER 817

149
COWAN V SCARGILL 1985 CH. 270

ABSTRACT

The decision in Cowan v Scargill129 is an important decision because it concerned a dispute over
the trustee’s duty of investment of trust property. The decision in the case establishes the position
that the trustee has a duty to maximize returns on the trust funds.

The case looks at the approach the court took concerning the duty of a trustee to invest trust funds
and if the trustee can seize the investment of the trust funds his holding on trust. The resolution in
this case is that a trustee should carry out his duty to invest trust funds despite proposed restriction
on investment

INTRODUCTION

This is a High Court case of 23 April 1985. In this case, a leader of the National Union of
Mineworkers (NUM) joined the Scheme’s trustee board in 1982. We later see in this case the
refusal of the High Court of the application that was made, rejecting a new investment plan for the
trust funds due to the very fact that it was competing with forms of energy, the court stated that the
plan yields the best interest for the beneficiaries. Sir Robert Mergarry V-C considered the trustees
investment duty in detail, saying the best interest for the beneficiary are normally their best
financial interest.

FACTS

The defendant, Arthur Scargill, was the leader of the National Union of Mineworkers (NUM) as
well as a trustee of the Miners’ Pension Fund which he had joined in the year 1982. The Trustee
Scheme had an investment plan to invest in South Africa and also in an oil industry. However, Mr.
Scargill was not in favour of this proposal and suggested that this was not of benefit for the
beneficiaries and that it was in direct competition with the coal industry. The defendant and the
other union trustees proposed that the investment plan be withdrawn due to the conflict with a
policy decision of the National Union of Mineworkers stating that no investment would be made

129
1985 Ch. 270

150
overseas or that was in direct competition with the coal industry (this being one dealing in oil or
gas).

The trustees had later received legal advice stating that the most suitable of investment was to be
decided almost exclusively by reference to the financial criteria rather than their acceptability for
either political or moral reasons. However, Scargill the defendant restated his “total opposition” to
the overseas or competing investment, even if a better financial result could be obtained from such
investments. He argued further that the National Union Mine workers also voted unanimously for
the policy.

Having five Union trustees and five employer trustees in the Union, a deadlock resulted, because
the chairman was an employer appointed trustee, who had no casting vote. Thus, the case was
brought before the court to resolve this issue, with Cowan, the plaintiff chosen to represent the
employer trustees and Scargill, the defendant representing the union trustees.

HOLDING

It was held by the courts that the trustee has a duty to maximize returns on the trust fund and it was
not up to the defendant to reject the investment advice based on the fact that he had personal or
moral objects to the investments.

The defendant therefore lost the case and had to take the advice from miner’s pension fund
investment plan. Meggary held that the duty of a trustee is to generate the best available return on
the trust fund regardless of other considerations.

SIGNIFICANCE

The case highlights the duty of the trustee, and that is to generate the best available return on the
trust fund regardless of other consideration. The trustee has the duty to maximize returns on the
trust fund and it was not up to the defendant to reject the investments advice on the basis that he
had personal objections to the investment130.

The case of Cowan v Scargill holds significant implications for the duties and responsibilities of
trustees, particularly within the context of pension trusts. At its core, the case entails the

130
Judith Riches (2017) Optimizing equity and trust 2 nd edition (page 252)

151
fundamental duty of trustees to exercise their powers in the best interests of both present and future
beneficiaries of the trust. This duty involves prioritizing the financial wellbeing of beneficiaries,
as trusts primarily aim to provide financial benefits.

Furthermore, the case highlights the obligation for trustees to set aside their personal interests and
perspectives when making investment decisions. Even if some decisions may require actions that
seem dishonorable, trustees are obligated to act in accordance with the best interests of the trust's
beneficiaries. This duty may extend to scenarios where trustees must make decisions that align
with the beneficiaries' moral values, although this is less likely to be relevant in pension trusts.

Moreover, the standard of care expected of trustees is likened to that of an ordinary prudent
individual investing for the benefit of others, emphasizing the need for diligence and seeking
professional advice when necessary. Additionally, trustees are mandated to consider
diversification of investments. This emphasis on diversification is particularly crucial for pension
trusts due to their substantial size, further underlining the importance of mitigating risks through
varied investment portfolios.

Trustees are not obliged to divest themselves of all their personal beliefs and social and political
views in managing the investments of the pension fund. As trustees they are perfectly entitled to
have a policy on ethical investment and to pursue that policy, so long as they treat the interests of
the beneficiaries as paramount and the investment policy is consistent with the standards of care
and prudence required by law.

This means that trustees are free to avoid certain kinds of prudent investment which they consider
the scheme members would regard as objectionable, so long as they make equally advantageous
investments elsewhere, and that they are entitled to put funds into investments which they believe
the members would regard as desirable, so long as these are proper investments on other grounds.
What trustees are not entitled to do is to subordinate the interests of the beneficiaries to ethical or
social demands and thereby deprive the beneficiaries of investment or opportunities they would
otherwise have enjoyed.

In essence, the principles elucidated in this case serve as a base for understanding the fiduciary
duties of trustees, with far-reaching implications for the management of both private and pension
trusts. Through its rulings and interpretations, guidelines are established for trustees to uphold the

152
financial interests of beneficiaries while adhering to ethical and legal standards in their investment
decisions.

CONCLUSION

This case teaches us that when it comes to a trustee making an investment of the trust property or
funds, its less about he’s opinion and preferences but on what can best benefit the beneficiaries.
The trustee is to venture in any reasonable business to ensure that there is maximization of the
returns.

To sum up, In this case of Cowan v. Scargill, the court decided that the miners were owed
compensation according to the terms of the collective agreement between the National Union of
Mineworkers and the National Coal Board.

This ruling confirmed that providing for beneficiaries with the financial benefits is to be prioritized,
seeking the best way to do it. Furthermore, in terms of investment, the decision from the case of
Cowan v. Scargill highlights the importance of honoring of investments to ensure that all parties
involved receive the benefits they are entitled to. This case serves as a reminder of the legal
protection and rights that come with investing and the necessity of upholding agreements for fair
outcomes.

153
LOYDS BANK PLC V DUCKER [1987] 3 ALL ER 193
ABSTRACT
The case of Lloyds Bank plc v Duker131 is an insightful case with regards to a trustee’s duty to
act impartially and to maintain a balance of interest among beneficiaries.
A prominent decision was made in this case that placed an important obligation on trustees. It
highlights the fact that fair and equal distribution of trust property should be at the core of the
trustee’s discretion; ensuring that no beneficiary takes more than others have.
It is evident from the decision of the court from this case that the trustee must ensure a balance of
interest and not favour any one of them.
INTRODUCTION
Lloyd's Bank v Duker 1987 is an English trust law case where the court refused an application
requiring the trustees to transfer to a beneficiary his share of a trust fund. The reasoning behind
the court refusal was that the transfer would have entitled the beneficiary to a majority holding in
the company, which would have exceeded the value of of the remaining shares subject to the trust
FACTS
In this case, the testator had settled property of 999 shares in a company that owned a Hotel in
Torquay. Of this property, 46/80 was supposed to go to the wife and the remaining to five other
beneficiaries. Of the 999 shares that were available, it appeared that the wife was entitled to 574
shares. The rest of the 425 was to be shared among the five beneficiaries.
An application was then made that the shares be transferred to the wife.
HOLDING

The court held that the transfer of the 574 shares was going to undermine the trustee’s duty to act
impartially and the duty to not favour one beneficiary over others, as the transfer of these shares
would mean that majority of the property would have gone to one beneficiary (the wife) and less
to be shared among the other beneficiaries. Furthermore, the wife having been given these shares
would mean her having more control in the company.

131
[1987] 3 ALL ER 193

154
The court also decided that the shares be sold and that the proceeds be shared among all the
beneficiaries in accordance with the provisions of the testamentary trust in order that the duty to
also maintain a fair balance among the interests of all the beneficiaries may take precedence.

SIGNIFICANCE

This case upholds the duty of a trustee to act impartially among multiple beneficiaries and to ensure
that he/she does whatever in his capacity to ensure that the trust property is distributed fairly and
that no one beneficiary benefits more than the other. The trustees are expected to act honestly, in
a diligent manner and in the best interests of the beneficiaries as they perform their duties. Trustees
are not supposed to show favour to a beneficiary or group of beneficiaries and are required to act
impartially and in the best interests of all the beneficiaries.

CONCLUSION

From this case we learn more than vividly that a trustee has a duty to act in the best interest of the
beneficiaries by not being partial and favouring one beneficiary but by ensuring that the interests
of the various beneficiaries are balanced132

132
Philip H pettie E (2009) equity and the law of trusts 20 th edition

155
NESTLE V NATIONAL WESTMINSTER BANK PLC [1992] EWCA CIV 12

ABSTRACT

This decision in Nestle v National Westminster Bank Plc is an important decision because it
clarifies the position of law regarding the investment duties of a trustee. This case concerns the
duty of care when a trustee is making an investment. The case is important because it highlights
the due diligence taken by a trustee before making investments on behalf of a beneficiary, it shows
that by conducting due diligence, trustees aim to fulfill their fiduciary duty to act in the best
interests of the trust beneficiary.

In Nestle v National Westminster Bank Plc, the dispute arose when the beneficiaries of a trust filed
a lawsuit against a trustee corporation, alleging breach of fiduciary duty in managing the trust fund.
The plaintiff argued that the bank failed to diversify the equities in the fund and did not conduct
regular reviews of investments of the trust fund.

This case comment looks at the approach the Court of Appeal took regarding Investment duties of
a trustee, so as to properly manage the trust fund and follow appropriate investment policies. It
also seeks clarity on the power of investment of a trustee. The case comment seeks to provide
clarity on issues associated with investment duties of a trustee.

INTRODUCTION

The appeal is concerned with investment policies by the bank, from time to time, in relation to the
funds subject to the testator’s will. The appellant alleges that the Bank is in breach of the trust.

This is an appeal by the plaintiff Miss Nestle, against a judgement of Hoffman J., given as long as
29th June 1988, whereby, by the end of the trial of the action he dismissed all Miss Nestle’s claims
against the defendant in the action, National Westminster Bank Plc.

FACTS

Miss Nestle, as the trustee of her grandfather’s will, sued National Westminster Bank Plc (the
Bank) for not properly managing the trust fund. The testator died in 1922, leaving a trust worth
£269,203. Miss Nestle Claimed that if the bank had properly managed the fund and followed
appropriate investment policies then, it would have made well over £1m. The Bank was given
power to invest the funds and had power to retain any investment.

156
The Bank had invested the trust fund and had generated a substantial amount, but the appellant’s
claim was that it did not generate enough income and had not followed the right investment
policies. The appellant therefore had to prove that a prudent trustee, knowing of the scope of the
bank’s investment power and conducting regular reviews, would have invested the trust funds as
to make it worth more than it was worth, when the trustee inherited it.

The Bank was sued by Miss Nestle as the trustee of the will of her grandfather, William David
Nestle (the testator). By his will, the testator appointed the National Provincial Bank to be his sole
executor and trustee. The National provincial Bank merged with the Westminster Bank which
therefore succeeded to the trusteeship of the testator’s will.

The Bank invested a substantial part of the fund exempt British Government securities to avoid
estate duty. The Bank did seek legal advice on the scope of its power to invest in ordinary shares
and assumed its powers were wholly governed by the Trustee Investment Act. 133 Miss Nestle
claimed that the Bank failed to diversify the equities in the fund and did not conduct regular
reviews of the investments in the trust funds.

HOLDING

The court of appeal held that the Bank did not breach its duty to properly manage the trust fund.
The Bank Invested a Substantial Part of the fund in Exempt British Government securities to avoid
estate duty, which was a valid reason for the investment decision.

It was held that the trustee (bank) should have familiarized itself with the trust instrument, if they
did they would have known the full scope of their investment power. However, although the bank
did a bad job, there wasn’t any loss so it was okay.

The Bank did not breach its duty to diversify the equities in the fund as there was evidence that
pension funds and life assurance companies also invested less than half their funds equities. The
Bank did not breach its duty to conduct regular reviews of the investments in the trust funds as
there was evidence that reviews took place between 1940 and 1959.

133
Trust Investment Act, 1961 (9&10 ELIZ.2), Chapter 62 of the Laws of the United Kingdom.

157
Miss Nestle did not provide any proof that she suffered any loss because of the Bank’s alleged
breach of contract. Therefore, her claim for compensation or damages in respect of the investment
of the annuity fund between 1922 to 1960 failed. The appeal was dismissed with costs.

SIGNIFICANCE

This case primarily highlights on the duty of the trustee to invest the trust property and to what
extent he can invest.

The case is important because it highlights a trustee’s duty to “take such care as an ordinary prudent
man should prudent man would take if he were minded to make an investment for the benefit of
other people whom he felt morally bound to provide” as Lindley L.J has expressed it. The case has
emphasized that trustees should make investment duties with care, skill and diligence that prudent
person would use in similar circumstances.

Trustees are held to a high standard of care and must act prudently when managing the trust assets.
Speight v Gaunt [1883]134, established the ‘prudent person’ rule, which requires trustees to invest
trust assets as a prudent person would invest their own money. It emphasized the importance of
considering the risk and return characteristics of investments and diversifying the portfolio to
minimize risks. The trustee’s investment duty is to invest the fund in a particular way, and that it
is prudently fair.

Judith Riches in the book Optimize Equity and Trusts has stated that with reasonable time after
the creation of the trust, trustees have a duty to invest the trust fund. When doing so, they must
bear in mind the different interests of the beneficiaries. 135 The parties to this claim were aware of
this. And so, the Bank was in its rights as a trustee to invest in what they thought would benefit
the beneficiaries.

When the purpose of the trust is to provide financial benefits for the beneficiaries, as usually is the
case, the best interest of the beneficiaries is normally their financial interest. This case has
highlighted the importance of diversification in investment management. Trustees must not unduly
concentrate trust assets in one type of investment or asset class. The case of Cowan V Scargill

134
[1883] UKHL 1, (1883-84) LR 9 App Cas 1
135
Judith Riches, Optimize Equity and Trusts, second Edition, page 252.

158
[1985]136 states that the duty of a trustee is to best generate the best available return on the trust
fund regardless of other considerations.

The power of investment must be exercised so as to yield the best return for the beneficiaries,
judged in relation to the risks of the investments in question, and that the prospects of income and
capital appreciation, both have to be considered in judging the return of the investment.137 A
Trustee in exercising any power of investment must have regard to the standard investment criteria
and trustees must also from time to time review the investments of the trust.

The case highlights the power of investment as crucial for trustees as it enables them to manage
assets effectively and generate returns for the benefit of the beneficiaries. Trustees before
exercising any power of investment must obtain and consider proper advice about the the way in
which, having regard to the standard investment criteria, the power should be exercised.

Section 6 of the Trustee investment Act 1961 that was used in the case before the changes to the
legislation stated that;

In the exercise of his powers of investment a trustee shall have regard-

a) To the need for diversification of investments of the trust, in so far as is appropriate to the
circumstances of the trust.

b) To the suitability to the trust of investments of the description of investment proposed and
to the investment proposed as an investment of that description.

Overall, section 6 of the Trustee investment Act 1961, provided guidance in this case, it gave
specific instructions on how trustee’s power of investment should be exercised.

The court in this case emphasized the duty of trustees to review and monitor trust investments
regularly. Monitoring trust investments regularly is a crucial aspect of trustee responsibilities to
ensure that the trust assets are managed prudently and in the best interests of the beneficiaries.
Regular monitoring is essential because it allows trustees to assess the performance of trust
investments against predefined objectives. It is a fact that trustees have a duty to monitor trust

136
[1985] Ch 270.
137
Philip H Petit, Equity and the Law of trusts, 12 th Edition, page 416.

159
investments regularly and to take appropriate action if invests are not performing as expected.
Failure to maintain monitor investments adequately can result in liability for trustees and losses to
the trust estate. Neglecting this duty can lead to breaches of the trust.

Overall, Nestle v National Westminster Bank Plc, serves as a reminder of the importance of active
and diligent management of trust investments by trustees. It reinforces the fiduciary duties of
trustees and underscores the potential consequences of failing to monitor trust investments
adequately.

CONCLUSION

The decision in this case is important because it clarifies the power of investment of a trustee and
the extent to which they can use this power conferred upon them. The decision in the case has
supported the fact that duty of care is important when managing investment assets in a trust. As
observed from the analysis and judgements from the scholars and also arguments from the
reference cases above. There is a vivid specified and landmark precedent pertaining the general
rule that powers of a trustee with regards to investment is entirely dependent on their discretion.
The core business for trustees in this context is an aspect of dodging losses thus by proper
management of trust funds

160
SCHMIDT V ROSEWOOD TRUST CO [2003] 2 AC 709

ABSRACT
The case of Schmidit v Rosewood Trust138 is a landmark case in as much as the disclosure of
trust document to the beneficiaries is concerned. This is a binding precedent articulating the stance
of the law concerning the accountability and confidentiality argument.

This is a more principled approach to the issue pertaining the right to seek disclosure of trust
document as a jurisdiction based on the necessity to supervise and intervene in the administration
of trust. The right to seek the courts intervention by the beneficiary and how the trustee’s fiduciary
duties must be protected with regards to a discretionary trust.

Therefore, the court is required to balance the competing interests of the different beneficiaries,
which include the trustees, and third parties who can be termed as acting with two evils, the
position taken in this well-articulated case is based on the clarification on the decision of the court.

INTRODUCTION
This is the case in which a man created a discretionary trust in form of a group of objects with the
inclusion of the claimant. The defendants company was assigned as the trustee to two settlements
in which the settlor died without leaving a will, the claimant who was a son to the deceased in
trying to trace the father’s assets he took some steps involving efforts and ended up being frustrated
by the father’s co directors

FACTS
The appellant's father ('Mr. Schmidt') was the co-settlor of two Isle of Man settlements, the
Angora trust and the Everest trust of which Rosewood was the trustee. It appeared that over
US$105m had been received by the two settlements since their creation. Mr. Schmidt died
unexpectedly and intestate in Moscow in 1997.

The appellant was entitled to share in his estate and he obtained letters of administration in the Isle
of Man and commenced proceedings against Rosewood in the Isle of Man alleging breach of trust
and breach of fiduciary duty. He obtained an ex parte order prohibiting Rosewood and other
defendants from dealing with the trust assets and requiring them to make extensive disclosure. The

138
[2003] 2 AC 709

161
appellant commenced further proceedings seeking fuller disclosure of trust accounts and
information about the trust assets, not by way of discovery in the 1998 proceedings, but by virtue
of the discretionary interests or expectations that he had under the settlements personally and as
administrator of his father's estate.

The Deemster held that the application was not an abuse of process and made an elaborate order
for Rosewood to make extensive disclosure and to provide information to named accountants, as
"inspectors", and their lawyers to hold in confidence. Rosewood appealed arguing that the
appellant and his father never had any interest in the settlements except as the mere objects of a
discretionary power of appointment and were accordingly not entitled to trust documents or
information. The Staff of Government Division set aside the Deemster's order.

The appellant appealed to the Privy Council. HELD: (1) As a matter of construction of the trust
deed it could not be assumed that the appellant in his personal capacity was a beneficiary in any
sense under the Angora trust. In relation to the Everest trust the appellant in his personal capacity
was no more than a possible object of the very wide power to add beneficiaries. (2) The right to
seek disclosure of trust documents was an aspect of the court's inherent jurisdiction to supervise
and if necessary to intervene in the administration of trusts.

A beneficiary's right or claim to disclosure of trust documents or information did not depend on
the proprietary basis of a transmissible interest in the trust property (O'Rourke v Darbishire (1920)
AC 581 considered). The right to seek the court's intervention did not depend on entitlement to a
fixed and transmissible beneficial interest (Hartigan Nominees Pty Ltd v Rydge (1992) 29
NSWLR 405 considered). (3) The object of a discretion, including a mere power, could be entitled
to the discretionary protection of a court of equity by way of disclosure of trust documents subject
to considerations of confidentiality. No beneficiary had any entitlement as of right to disclosure of
trust documents. (4) The Staff of Government Division was wrong to hold that the Deemster had
no jurisdiction to make the order for disclosure he did. The Deemster's order should be restored
and the matter remitted to the High Court of the Isle of Man for further consideration.

HOLDING
(a) The right to seek the court’s intervention does not depend on entitlement to an interest
under the trust. An object of a discretionary trust (including a mere power of appointment) may

162
also be entitled to protection from a court, although the circumstances concerning protection and
the nature of the protection would depend on the court’s discretion.

(b) No beneficiary has an entitlement, as of right, to disclosure of trust documents. Where there
are issues of personal and commercial confidentiality, the court will have to balance the competing
interests of the beneficiaries, the trustees and third parties and limitations or safeguards may be
imposed.

SIGNIFICANCE

The decision undertaken in this case of Schmidt v rosewood trust limited is very important in as
much as the disclosure of trust documents to beneficiaries is concerned. This is a precedent that
now binds all cases of similar facts to it. Of course this is hereby discussed with proper and valid
references in insuring that we trace the reasoning and the importance of the decision that was made
as it amounted to it being a deciding case on disclosure of the trust instruments.

Trust document, are documents which contain information regarding the construction of a trust.
Lord Justice Salmon stipulates that, they are documents obtain by the ‘trustees as trustees’, which
retains information regarding the beneficiaries.

In the legal dispute of Vadim Schmidt v Rosewood Trust Ltd, the central contention revolves
around the disclosure of trust documents to beneficiaries. When beneficiaries make requests for
access to documents pertaining to the administration of the trust, there is a

prevailing argument that such documents ought not to be withheld from them. This argument
is rooted in the rationale articulated by Lord Wrenbury in the case of O’Rourke v Darbishire139.
Lord Wrenbury stipulated that beneficiaries who can substantiate their status possess a legitimate
entitlement to inspect documents that are under the control of the executor. Nevertheless,
detractors of this perspective raise concerns that such an approach may potentially encroach upon
the trustee’s fiduciary duties and contradiction upon the confidentiality rights of the settlor.

139
(1920) AC 581

163
In contrast to the viewpoint expressed by Lord Wrenbury, Lord Justice Danckwert’s analysis in
Re Londonderry’s Settlement140 underscores the confidential aspect inherent in trustees’ roles.

He posits that trustees, particularly when tasked with discretionary trusts involving decisions
among beneficiaries, are entrusted with a confidential duty. His judgment asserts that trustees
cannot effectively discharge this confidential duty if they are continually subject to scrutiny by
beneficiaries querying the correctness of their exercise of discretion. Thus, while acknowledging
the confidential nature of trustees’ roles, he suggests that continuous beneficiary scrutiny could
potentially compromise their ability to fulfill this duty effectively.

Mohamed Ramjohn141 indicated that beneficiaries are entitled to inspect the accounts from the
trustee. This puts more emphasis to what type of documents can be disclosed.

Lord Justice Salmon, in the aforementioned case, introduces the term ‘embitter’ in his ruling,
suggesting that the disclosure of trust documents could exacerbate familial sentiments towards
trustees. He further asserts that such aggravation may make it challenging to find individuals
willing to assume the role of trustees, particularly when there is a duty to disclose reasons,
potentially leading to conflicts, misunderstandings, or disorder within the trustee-family dynamic.
Drawing upon the analysis presented in Re Londonderry Settlement, it can be argued that the
judges mentioned above both contemplated and concurred with the decision rendered in the case
of Re Cowin v Gravett142. This precedent underscores that documents reasonably considered as
trust documents should remain undisclosed to beneficiaries, irrespective of their entitlements.

However, in assessing the decision made regarding this issue, it may be fair to state that

Lord Walker in Vadim Schmidt v Rosewood Trust Ltd, agreed with the decision made in Re
Londonderry Settlement and Re Cowin v Gravett to some extent. Although, Lord Walker did not
plainly mention trustee’s confidentiality, it may be said he upheld this notion, due to the fact that,
he limits beneficiaries right, by restricting the types of documents they were entitled to access.

140
(1964) 3 ALL ER 855
141
Unlocking Equity Trusts and Wills, Mohamed Ramjohn, 5th edition (2015). Page no. 442.
142
(1886) 33 Chad 179

164
Judith riches 143 emphasized that documents which state the reason why trustee’s made a
particular decision when exercising their discretionary powers do not have to be disclosed unless
the court orders.

The confidentiality surrounding a testamentary letter entrusted to a trustee operates on a fiduciary

basis, thereby necessitating the exercise of sound judgment with due regard to the beneficiaries’
interests. While the primary obligation of a trustee is to ensure accountability to beneficiaries, this
obligation may conflict with the settlor’s desire for confidentiality regarding the trust instrument
and financial status. Nevertheless, instances may arise where exceptional circumstances outweigh
the beneficiaries’ right to information, allowing for the preservation of confidentiality. It is
contended that in cases where confidentiality and privacy intersect with the evaluation of trust
assets, the trustee’s duty to maintain confidentiality remains intact, in accordance with the
principles of transparency and accountability.

In O’Rourke v Darbishire, Lord Wrenbury defines proprietary right as, an authority to scrutinize
documents belonging to beneficiaries.

A beneficiary has a proprietary interest in the trust fund, where they are beneficiaries ‘under a
discretionary trust’. Lord Sumner in O’Rourke v Darbishire indicates that a beneficiary, who
brings an action against ‘his trustee”, is normally permitted to scrutinize all trust documents
relating to the issue.

Subsequently, this issue was also raised in Mcphail v Doulton, where it was concurred that the
Court has the power to intervene, where trustees have7 been acting ‘capriciously’ and has therefore
acted outside their powers. Based on the latter sentence, it may therefore be said that Mcphail v
Doulton has somewhat agreed with Re Cowin v Gravett, upholding that the Court has jurisdiction
to intervene where disclosure of trust document is considered.

Lord walker’s remarks

It’s neither sufficient nor necessary to have proprietary interest. There may be circumstances
especially of confidentiality in which even a vested and transmissible beneficial interest is not a

Optimizing equity and trusts, 5th edition, 2017. Page no. 255
143 7
(1970)
UK HL 1

165
Sufficient basis for requiring disclosure of trust documents.

The above remarks show the importance of the holding to the case of Schmidt v rosewood

Trust ltd as it clearly vests authority into the judiciary to decide and in some way encourages
Parties to a dispute to seek justice. Thus the courts scrutiny takes up all.

CONCLUSION

The primary notion has been set and modern cases has upheld the factors raised in Vadim Schmidt
v Rosewood Trust Ltd as seen from the references alluded to earlier, which entellus that trustees
are not bound to disclose trust document, however the Court has the power to intervene and justify
their decision.

These decisions, therefore indicates that the provision as to disclosure of trust document does not
depend upon the beneficiary’s propriety right, but is based upon the trustee’s accountability to
uphold the settlor’s confidentiality and most importantly, the Court inherent jurisdiction to
supervise the trustee’s decision and intervene. To some extent this discussion concerning
disclosure of trust documents seem to be somehow complicated such that judges have had
undertaken different divisions on facts of the same nature. In general, and common language this
can be termed as ‘acting with two evils '. In trying to maintain confidentiality on the side of the
trustee as one of the core business for constituting a trust, accountability also need to be considered
as beneficiaries would like to inspect trust assets in respect of management and all sorts of
progress.

Therefore, the need to have the courts discretion as a decider to when, why and how to allow
disclosure of these trust instruments seem to be key and important. However this must be Carried
out without throwing away the principle in breakspear v Ackland144 which sets up the general
rule to which content of a document can be disclosed based on the argument raised.

144
(2008) 3 WLR 69801

166
CHARITY OPARAOCHA V WINFRIDA MURAMBIWA (APPEAL 158 OF 2002) [2004]
ZMSC 110 (11TH JUNE 2004)

ABSTRACT
The decision in Charity Oparaocha v Winfrida Murambiwa is an important decision because it
clarifies the position of the law regarding who a dependent is as well as what the jurisdiction of
the Local Court is in relation to granting Letters of Administration . The decision in this case
reaffirms the position that a dependent is a person living with that deceased as per section 3(a) of
the intestate succession act. . The court relied on section 43(2) of the Act which limits the
jurisdiction of the Local Court in matters of successions to estate whose value do not exceed fifty
thousand Kwacha in dealing with the issue of jurisdiction of the Local Court.
This article looks at the approach taken by the Supreme Court regarding the definition of who a
dependent to a deceased person is and the nature of cases in relation to estates the Local Court can
handle. The article seeks to provide clarity on issues pertaining to whether only relatives staying
with a deceased person are dependents or any person, regardless of relations with the deceased is
a dependent.
The position of this piece of writing is that the mistress should be categorized as a dependent,
taking the literal rule, of Section 3(a) of the Intestate Succession Act. The Court in its judgement
in this case adopted the literal meaning of the act and looked at the words as they were, to construe
its meaning.
INTRODUCTION
This was an appeal against the ruling of the High Court which found that the Respondent’s
marriage to the deceased was null and void, because the deceased had been married to the
Appellant under the Kenyan Statutory Law, the learned judge further went on to rule that the
respondent was a dependent of the deceased and therefore entitled to her share of 10% of the estate
since immediately prior to his death, she was maintained by the deceased together with her children
and they were housed in a rented house for which the deceased paid rent. The Supreme Court
upheld the decision of the lower court by referring to the definition stipulated in Section 3(a) of
the Intestate Succession Act.

167
FACTS
The Appellant was the administrator of the estate of the late Dr. Christopher Oparaocha and his
widow. She got married to the late Dr. Christopher Oparaocha on 15th July 1971, under the
Marriage Act of Kenya. She informed the Court below that she lived with her husband throughout
the marriage until his death.
The Respondent was also married to the late Dr. Christopher Oparaocha. In December 1986, the
Respondent and the late Dr. Oparaocha had a traditional ceremony of marriage in Nigeria at the
deceased’s village. The trial court heard that at that time of the marriage, the Respondent knew
that the deceased was married but did not know the type of marriage contracted between the
deceased and the Appellant. The Respondent had three children with the deceased, two of whom,
were born at the University Teaching Hospital in Lusaka, and the third, in Nigeria. The birth
Certificates in respect of the three children indicated the deceased and the Respondent as the
parents. The Respondent lived with the deceased up to 1992, when he died. The Respondent
testified that the deceased had rented a house for her in Kabwata Estates and met all her needs
together with those of the children.
The Appellant’s testimony in lower Court was that she never knew the Respondent or her children
before the death of her husband. The Appellant went on to state that after the death of her husband,
she checked the family file at Immigration Department and found that the Respondent’s children
were not registered. Using the statistics from the immigration file, she administered the estate. She
put up a death notice in Zambia and abroad and no one called with any claim. The Appellant told
the Court that she completed the administration of the estate and was now no longer the
Administrator. Sometime later in 1992, the Appellant became aware that someone claimed to have
children with her husband, but since the claiming did not provide any proof, she disregarded the
claim and did not make any provision for her.
The learned trial Judge in the High Court found that the Respondent’s marriage to the deceased
was null and void, because the deceased had been married to the Appellant under the Kenyan
Statutory Law. On this premise, the trial Judge was of the view that the Respondent could not
validly claim to be the deceased’s widow. 4 The trial Judge was of the view, however, that in view
of the size of the estate, it was beyond the jurisdiction of the local Court and the Subordinate Court
as prescribed by law. According to the Court below, the Appellant should have obtained probate
in the High Court for Zambia. On the evidence, which was before him, the learned trial Judge

168
found that the Respondent was a dependent of the deceased and therefore entitled to her share of
10% of the estate since immediately prior to his death, she was maintained by the deceased together
with her children and they were housed in a rented house for which the deceased paid rent. The
trial Judge also found that there was cogent evidence to prove that the Respondent had three
children with the deceased. The trial judge went on to state that the children were entitled to the
share of their father’s estate in accordance with the applicable law and that these shares must be
equal to the shares taken by the Appellant’s own children. The High Court therefore found that an
order of administration of the estate of the late Dr. Christopher Oparaocha, obtained by the
Appellant, was null and void ab initio and cancelled it post facto. The High Court ordered that the
Appellant should provide a full inventory of the estate showing how it was distributed, within sixty
days of the judgment. It also ordered that all traceable assets should be re-assembled for fresh re-
distribution under the Intestate Succession Act No. 5 of 1989.5 Dissatisfied with the Judgment of
the Court below, the Appellant appealed to the Supreme Court145.
HOLDING
The Supreme Court dismissed the appeal and therefore upheld the decision of the High Court by
stating that the evidence before the lower Court clearly established that the respondent’s interests
together with those of her children, who were beneficiaries under the estate were completely
ignored.
SIGNIFICANCE
The case highlights two significant issues, the definition of who a dependent is and the jurisdiction
of the Local Court concerning administering Letters of Administration.
With reference to the first issue, the definition of a dependent is provided for in both Wills and
Administration of Estates Act and the Intestate Succession Act. Counsel for the Appellant referred
the court to the definition of dependent in both statutes and the court stated that it was common
cause that the deceased died intestate, and his estate was administered under the Intestate
Succession Act and it was on this premise that the court relied on the definition of who a dependent
is under the Intestate Successions Act.
The definition of dependent in the Intestate Successions Act is:

145
[2004] ZMSC 110

169
 dependent’ in relation to a deceased person means a person who was maintained by that
deceased person immediately prior to his death and who was
a. A person living with that deceased person; or
b. A minor whose education was being provided for by that deceased person; and who
is incapable, either wholly or in part of maintaining himself;146

For purposes of the case the court only relied on option (a) since the party to the case was not a
minor. Counsel for the Appellant argued that the intention of the legislature was to cater for close
relatives and not every person including mistresses. Counsel’s argument was based on the fact that
the Respondent’s marriage to the deceased in this matter was declared null and void by the lower
court and the court rightly did so since the deceased was already married under Kenyan statutory
law. In upholding the decision of the lower court, the court stated that the wording of Section 3 of
the Act is clear. A dependent is any person who meets the criteria given in the Section. If the
Intention was to cater for close relatives, such intention could have been expressed in the language
of statute.
The second issue is on the Local Court’s jurisdiction on granting letters of administration. The
court relied on section 43(2) of the Act which limits the jurisdiction of the Local Court in matters
of successions to estate whose value do not exceed fifty thousand Kwacha. It was clear to the court
that this provision was enacted at a time when the Kwacha had more value and that going by the
current trends very few, if any, would an estate the value of fifty thousand Kwacha and below. It
was however on record in this case that the deceased’s estate had property within and outside
Zambia, which included real property. Clearly, the value of the deceased’s estate went beyond the
jurisdiction of the Local Court. The court therefore upheld the decision of the lower court in finding
the appointment of the appellant as administrator of the estate of the deceased null and void and
consequently cancelling the Order of appointment post facto.
Local Courts, being Courts that interface with the most venerable members of the community, they
are located in all remote and urban areas of the Country. In terms of access to justice, there are
several Local Courts in Zambia as compared to all the superior Courts put together, mainly due to
the demand by most community members to litigate through the Local Courts and further that

146
Intestate Succession Act, Chapter 59 of the Laws of Zambia

170
Local Courts are less complicated to access as compared to superior Courts where mostly its by
services of Lawyers. It is due to the foregoing that most people find it easier to go to the local court
for appointment as administrator and more importantly lack of sensitization to the public on which
court has jurisdiction to handle which succession matter as well as the local court staff over
stepping their jurisdiction in such matters when the law is clear on the extent they should exercise
their jurisdiction. That being said, the question to be addressed in this regard is whether or not the
justice system is blameworthy for lack of sensitization on the local court’s operations or perhaps
on the failure by local court staff to know the extent of their jurisdiction?
CONCLUSION
The decision in this case is important because it brings to the fore issues pertaining to whether a
mistress should be classified as a dependant of a deceased. The Court held that a mistress can be
classified as a dependent provided she meets the criteria in Article 3(a) of the Intestate Succession
Act. That is, the mistress must prove she was maintained by the deceased and must have been
living with the deceased. This article has opined that the Supreme Court was on firm ground in
dismissing the appeal and upholding the decision of the lower court.

171
LINDIWE KATE CHINYANTA V DOREEN CHIWELE & JUDITH TEMBO (2007) Z.R.2
46
ABSTRACT

The case of Lindiwe Kate Chinyanta v Doreen Chiwele & Judith Tembo is a landmark case
because it gives clarity on the position of the law regarding who can be an administrator. The case
reaffirms that there is no provision in the law that that confers priority eligibility on the surviving
spouse for the office of administrator as well as provides that the surving spouse has to be consulted
before the appointment of an administrator.

This article looks at the measure the court undertook in respect of the requirements needed to
become an administrator as provided for in the Intestate Succession Act. This article seeks to
provide clarity on whether a surviving spouse has priority eligibility for the office of admintrator
and whether the surviving spouse has to be consulted before the appointment of an administrator
for the estate if the deceased spouse.

The position of this piece of writing is that a surviving spouse does not have priority eligibility for
the office of administrator and that there is no provision in the law that stipulates that the surviving
spouse has to be consulted on the appointment of the administrator of the estate of the deceased
spouse.

INTRODUCTION

This is an appeal against a high court judgement where the appellants claim for her appointment
as administrator or joint administrator of her late husband’s estate was rejected. The court ruled
that there is no provision in the law that gives the appellant priority eligibility as administrator for
the estate of her late husband as well as provides that she has to be consulted before the
appointment of an administrator for her late husband’s estate.

FACTS

The appellant was the wife of the deceased, she appealed the High Court’s judgement whereby the
appellant claim for appointment as administrator of the estate of her late husband. Following the
death of the deceased, the respondents, who are young sisters of the deceased, were appointed joint
administrators of the estate. The Appellant contended that it was wrong for the deceased’s relatives

172
to appoint the Respondents as joint administrators, she should have been informed so that she
could have consented or objected to their appointments. She argued that the Respondents would
not adequately address the family needs in that it would be very difficult for her to ask for all
family requirements from them at all times. She stated that she was literate and she understood the
obligation of administering an estate and that she would be able to distribute accordingly. That as
the surviving spouse ,she was the best person to administer the estate as she was in charge of the
family’s two school going children and was best placed to attend to the needs147.

HOLDING

In practice, siblings, parents or next of kin to the deceased are normally appointed. While in some
cases the widow or widower may be appointed as Administrator. There is nothing in the Act to
suggest that a surviving spouse has priority eligibility for the office of Administrator, even though
normally, a widow or widower is a beneficiary and may even be a priority beneficiary in the estate.
It is also not obligatory under the law to consult the surviving spouse although in civilized families,
information might be given and consultation may be made but this is not a requirement in law.
The appellant is therefore expected to cooperate rather than hinder the winding up of the estate
and distribution of the estate to the beneficiaries by the respondent.

SIGNIFICANCE

The case of Lindiwe Kate Chinyanta v Doreen Chiwele & Judith Tembo is significant as it clarified
the position of the law as to whether a surviving spouse has priority eligibility for the office of
administrator of the estate of the deceased spouse and whether the surviving spouse has to be
consulted concerning the appointment of an administrator for the estate of the deceased spouse.

The case highlights the fact that it is not a mandate for the spouse to be an administrator because
any person of interest can apply for the office of administrator as per Section 15(1) of the Intestate
Succession Act which states that where a deceased has died intestate the Court may on the
application of any interested person grant letters of administration of the estate to that interested
person. Where more than the required number apply, the court grants the letters of administration
to the persons of greater interest.

147
(2007) Z.R.2 46

173
The case further goes on to clarify under which conditions exactly a person may challenge the
appointment of the administrator. The Court stated that the appellant failed to supply sufficient
evidence as to why she should be made the administrator, it was stated that the appellant had to
prove that the administrators contravened one of the conditions stated in Section 29(1) of the
Intestate Succession Act.

Concerning the second significance, the court held that there is no provision in the law that requires
that the surviving spouse be consulted concerning the appointment of the administrator of the
estate of the deceased spouse despite the surviving spouse being a priority beneficiary as per
Section 5(1) of the Intestate Succession Act which stipulates that

5. (1) Subject to sections eight, nine, ten and eleven the estate of an intestate shall be
distributed as follows: Distribution of estate

(a) twenty per cent of the estate shall devolve upon the surviving spouse; except that where
more than one widow survives the intestate, twenty per cent of the estate shall be distributed
among them proportional to the duration of their respective marriages to the deceased, and
other factors such as the widow's contribution to the deceased's property may be taken into
account when justice so requires148;

CONCLUSION

The decision in this matter is important because it brings to the fore issues pertaining the surviving
spouse having priority eligibility and being consulted for the office of administrator of the estate
of the deceased spouse. The court held that there is no provision of the law which confers on the
spouse priority eligibility and consultancy powers to the surviving spouse on the appointment of
the administrator for the estate of the deceased spouse. This article has opined that the Supreme
Court was on firm ground to dismiss the appeal and uphold the decision of the lower court.

148
Intestate Succession Act, Chapter 59 of the Laws of Zambia

174
FRED M’TONGA AND ANOTHER V MATONKA APPEAL NO.93/2018

ABSTRACT

The decision of the Court of Appeal in this case- Fred M’tonga and another v Matonka, is of great
importance as it clearly highlights the position of the law concerning the validity of a Will. This
decision clarifies the position that for a Will to be valid, it must conform with the provisions of the
Wills and Administration of Testate Estates Act.

The article seeks to provide lucidity on matters relating to the registration of trust deeds upon the
creation of a trust.

This piece of writing will also look to criticize the decision of both the High Court and the Court
of Appeal regarding the registration of a Deed of Trust. This is due to the fact that the above-
mentioned courts of law neglected the importance of construing a statute in its entirety.

INTRODUCTION

The case of Fred M’tonga and another v Matonka is an appeal against judgment of the High Court
appeal No 93/2018, which was regarding the validity of the trust left with the will, the disposition
of the estate, and how the appellants did not give a proper account on how they administered the
estate. This was with regards to property which was left in the will and the property that was not.
The court declared the trust deed null and void for want of registration.

FACTS

Costain Muzipasi M’tonga (the deceased) died leaving a will, but did not dispose all of his assets
in the will, thus it was considered that he died partially intestate. He was survived by two wives
and thirteen children. The respondent's summons filed in the Court below was accompanied by an
affidavit in support and affidavit in reply that were sworn by the respondent.

In the affidavit in support of the originating summons, the respondent disclosed that she was one
of the thirteen children of the late Costain Muzipasi M'tonga who died intestate in or about August,
2005 and was survived by two spouses and thirteen children named in the said affidavit and left a
vast estate comprised of shares, private schools, real estate, motor vehicles and cash money in bank
accounts. The appellants were joint administrators of the estate and that they sold most of the

175
property, informally distributed funds from the estate to beneficiaries without any proper
documents to show how that estate was being distributed.

In the affidavit in reply to the affidavit in opposition to the originating summons, the Respondent
averred that the appellants had intermeddled with her father's estate to their own benefit. She also
challenged the Deed of Trust on the basis that it was not registered according to the lands and
deeds registry Act. Therefore, in the court below, the learned judge declared the Trust Deed null
and void for want of registration and the learned judge directed that the properties held under the
said deed form part of the deceased estate be distributed in accordance with the provision of the
intestate succession Act. Furthermore, the learned judge in the court below was satisfied that the
respondent had proven her claims on a balance of probabilities and entered judgement in her
favour.

On appeal, dissatisfied with the decision of the lower court, the appellants based their argument
on the following grounds;

The learned judge erred when she held that the Deed of Trust creating Muzi High School
Registered Trustees was null and void for want of registration without taking into account that the
Trust was established by the late Costain Muzipasi M'tonga before his demise and that Muzi High
School Registered Trustees owned Stand No. 14788, Lusaka long before the demise of the late
Costain Muzipasi M'tonga. They also raised the presumption that all formalities pertaining to its
registration were complied with. The appellants contended that the learned judge erred by stating
that properties held under the Deed of Trust should form part of the deceased's intestate estate and
be distributed in accordance with the provisions of the Intestate Succession Act.

The appellants further submitted that the learned Judge erred by making a determination which
nullified the sale of properties which belonged to the Trust and a company without taking into
account reliefs sought by the Respondent in her originating process and invoking section 19(2) of
the Intestate Succession Act.

On the other hand, the respondents’ counsel argued that there was no evidence to show that the
Deed of Trust was properly executed. Additionally, it was contended that this was indicated in the
appellants’ argument when they referred to a presumption that all formalities pertaining to

176
registration were complied with. Therefore, Counsel for respondent also submitted that the court
cannot be moved by submissions based on presumptions not by evidence.

Counsel contended that the learned judge was on firm ground when she held the Deed of Trust
null and void for want of registration and that the trust property be distributed according to the
provisions of the Intestate Succession Act.

Lastly, in response to the appellants’ contention about the lower courts’ decision on stand No.
14788, counsel for respondent submitted that the court based its decision on the evidence adduced
before it.

HOLDING

The Court of Appeal found that the learned trial Judge was on firm ground in declaring the Deed
of Trust null and void for want of registration and that properties held thereunder should form part
of the deceased's estate.

Furthermore, after perusing the entries in the exhibited copy of the Lands Register which from
entry numbers 1 to 9 at pages 67 to 69 of the record of appeal only refer to transactions with Muzi
High School and not Muzi High School Registered Trustees, the Court of Appeal held that the
finding of the Court below was fortified by the reference of Muzi High School.

The court agreed with Counsel for the Respondent that since the issue of the non-existence of Muzi
High School as a corporate body was introduced on appeal, it lacked jurisdiction.

On the other hand, the Court of Appeal upon close examination of the copy of the deceased's Will
found a number of irregularities with the said document. The Will was undated, with signatures
attested to by two witnesses at the same time and was not in the required format.

That being the position, the court found that the Will of Costain Muzipasi M'tonga was invalid and
ineffective in terms of the Wills and Administration of Testate Estates Act as it is incapable of
being registered in the Probate Registry. As a result, the court went further to order that all the
properties and finances should be administered in accordance with the provisions of the Intestate
Succession Act and placed a duty on the appellants to account for their distribution of the estate in
terms of section 19(2) of the Intestate Succession Act.

177
SIGNIFICANCE

The highlight of the case is based on its clarifications on rules regarding validity of trusts, on how
essential it is to take proper procedural steps on formulation of a Will, this includes proper
administration of an estate in both circumstances where a deceased died intestate or testate. The
case also gives some insight on matters that involve property ownership.

The case centered on validity of the deed of trust that was left together with the will. The trust deed
was rendered null and void due to absence of evidence of registration in the lower court and this
was not disputed, therefore not being in accordance with section 6 of the Lands and Deeds Registry
Act, Chapter 185 of the laws of Zambia.149 And the court of appeal stood on the same ground. The
importance of this ruling is on the fact that it emphasizes on the legal requirement of a trust to be
registered and individuals ought to comply with this requirement so as trust that have been created
should not run a risk of being invalidated in similar circumstances.

However, it is worth noting that it is not mandatory to register a Deed of Trust. Section 74(1)150
provides;

Except as hereinafter provided in relation to public lands, no entry of any notice of any
Trust shall be made in the township register, in the lands register, in any provisional
certificate or in any such entry, if made, shall have no effect.

(2) Trusts affecting land may be declared by any deed or instrument, and such deed or
instrument may be registered in miscellaneous register.

This proves a point that one may register a trust deed if they desire to do so. Having said so, it is
clear that both courts based their decisions regarding trust deeds, on section 4 which provides for
the requirement to register trust deeds. Additionally, the courts neglected the importance of
construing the entire statute. Henceforth, it must be noted that provisions of section 4 do not
override those of section 74 herein and a person can dispense with the requirement to register a
trust deed.

149
Lands and Deeds Registry Act, Chapter 185 of the laws of Zambia section 6
150
Ibid section 74

178
The said deed of trust also concerned property owned by Muzi High School registered trustees,
namely stand N2 14788, and the appellants claimed that it was a property in their name not one
that was part of the deceased estate. But it was held that Muzi High School was a separate legal
entity and it was with the capability to own property since it is a recognized separate entity. This
was proven by the appellants’ own admission and evidence from the Lands Register in the lower
court and thus used as basis for the ruling in relation to the claim in the higher court. This further
provides how essential it is in the making of documentation for property, as it recognizes that legal
entities such as a Muzi High School in this situation can own property as it is a separate entity.
Thus with the declaration of the trust deed null and void, the court undermined any claim of
ownership by other entities.

The case also highlights on matters concerning the proper disposition of the estate, looking at the
fact that the deceased left a Will, it ought to have been administered in line with the wishes of the
testator, which is in accordance with section 16(1) the Wills Act;151

‘The intention of the testator by his will shall not be set aside because it cannot take effect
to the full extent, but effect shall be given to it as far as possible’

And regarding the properties that were not stated in the Will, it ought to be properly administered
according to the Intestate Succession Act, so as to be in accordance with section 4(2) of the said
Act;152

‘any person who dies leaving a Will disposing off part of his estate has died intestate under
this Act in respect of that part of his estate which is not disposed of in the Will’

But the ruling had implications for administration of the deceased estate as the court found that the
Will was defective in form and invalid under the Wills and Administration of Testate Estates
Act, as result all the properties and finances were to be administered according to the Intestate
Succession Act. This aspect of the ruling highlights the legal requirement for Wills and the
consequences of their invalidity, thus setting standards ought to be reached by individuals
formulating Wills so as to avoid complications in the disposing of these properties.

151
Wills and Administration of testate estates Act, Chapter 60 of the laws of Zambia section 16(1)
152
Intestate Succession Act, Chapter 59 of the laws of Zambia section 4(2)

179
In respect to the Muzi High School’s corporate status, the issue was raised on appeal, meaning it
was a matter that was not raised or mentioned in the lower court. The court of appeal deemed that
such matters are not in the court’s jurisdiction as it does not have original jurisdiction, only
appellant jurisdiction. The court though concluded that despite certain orders made by the lower
court that were not initially pleaded, its decision of invalidating of the deed of trust therefore
affecting all properties contained in it was justified.

The address regarding the court jurisdiction, educates more on taking into account on how
pleadings are supposed to be made with regard to the court’s jurisdiction being kept in mind.

This article looks to the insight in which the learned trial judge was basing his adjudication on, as
the principles, rules and doctrines used are the legal framework in which the court interpret the
law and give solutions to various disputes.

Thus giving importance of complying with the legal requirements set down by law in order for the
Rights and Interests of Zambian people to be protected.

CONCLUSION

This case is of great importance because it clearly indicates the position of the law concerning the
validity of a will. It further clarifies that for a will to be valid, it must be in conformity with the
law. Additionally, although it is not a mandatory requirement to register a trust deed, this case
emphasizes the importance of registering a trust deed in the miscellaneous register so as to avoid
the risk of being invalidated in case of similar circumstances.

180
MILLER V KACHEPA (HP 1051 OF 2014) 2025 ZMHC 1

ABSTRACT

Miller v Kachepa is an important case as it clearly brings to the fore how the courts of law impose
constructive trusts on individuals as a result of their unconscionable conduct.

The decision of the High Court in this case is aimed at preventing unjust enrichment in maintaining
the basic principles of equity or justice. The court also considered how paramount it is to observe
the best interest of children as regards their custody.

This article is of the position that a constructive trust must be imposed where justice and good
conscience requires it.

INTRODUCTION

In this case, the applicant Rita Miller, commenced an action against the respondent, Samson
Kachepa. It was brought pursuant to order XXX of Zambia as read in order 7 rule 1 of the rules of
the supreme court, 1965 (white book) 1999 Edition volume one. The applicant claims to be entitled
to an equitable interest by way of a constructive trust in the 1.6 hectares property situate in
Shifwankula village district of the central province of Zambia and the mesne profit from the use
of the trucks.

FACTS

The application was supported by an affidavit sworn by the applicant in which she states that in or
about October 2001 the respondent and herself started cohabiting as an unmarried couple in quasi-
marital arrangement in Emasdale, Lusaka. As a consequence of the said co-habitation she gave
birth to two children mainly to the respondent namely Shepard Kachepa and Cecilia Kachepa.
Apart from the said children born from the Respondent the applicant moved into the house with
her first born daughter, Carol Musenje. She averred that since they moved in together with the
respondent, he was responsible for all the children’s upkeep and contributed to their children’s
welfare through payment of school fees, providing food, purchasing of clothes and general
maintenance of their children. The applicant submitted she contributed to acquisition of the
property in Shifwankula village.

181
Whilst living with the respondent in 2007 she identified a piece of land in chief Mungolo’s area,
they applied for its joint ownership as a couple from the local chief who gave them approval
consent for conversion from customary tenure to leave hood tenure into the state land.

After obtaining land and completion of construction works for the house, the family continued to
live in harmony until September 2011 when, due to the respondent unreasonable behavior and
unfaithfulness, differences developed as a result of they started living in separate rooms. In June
2013 the applicant together with the children moved out of the house to stay in a rented house
located in Longacres. She claimed that since she left the house, the defendant never contributed
to the welfare of their children. The applicant believed that the respondent was purposefully
refusing and neglecting to support their children.

The applicant claimed to be entitled to an equitable interest by way of a constructive Trust. She
sought the following reliefs; sharing of property in Shifwankula village and profit obtained from
use of the trucks on a 50-50 basis, an order for disposal of the trucks acquired by the parties when
they co-habited and share the money equally. Furthermore, the applicant sought an order for sole
custody of the children, an order for maintenance of the children by the respondent and whatever
the court may deem fit.

HOLDING

The court found that, indeed, the applicant, Rita Miller, contributed to the acquisition of the
property in Shifwankula village, Chibombo district of Central province. The court was convinced
that the applicant had proved her claims on a balance of probabilities. Henceforth, the court ordered
that the property be sold and the money be split equally between the two parties.

The court went further by granting an order for the trucks to be sold and the money be shared on
a 50-50 basis as well as granting sole custody of the children to the applicant, as the court sought
the best interest for the children.

SIGNIFICANCE

This case holds significant importance as it clearly outlines the legal stance on constructive trusts.
It defines the concept of constructive trust.

182
Herein, the applicant claims that there is a constructive trust in which she has beneficial interest.
It should be noted that a person can only be trustee under a constructive trust if specific property
is vested in him.153 The applicant claims that the 1.6 hectares property in Shifwankula village of
Chibombo district of Central province of Zambia and the profits made from the use of trucks are
the subject matter to the constructive trust. Counsel for the applicant submitted that there was a
constructive trust in which the applicant has beneficial interest.

It is, therefore, crucial to understand what a constructive trust is. The learned judge, in considering
what is meant by a constructive trust, referenced the case of Hussey v Palmer,154 Lord Denning
defined it as a trust imposed by law whenever justice and good conscience required it.
Additionally, he stated that a constructive trust is an equitable remedy used by courts to help the
injured party seek restitution. On the other hand, Ngulube DCJ (then) delivering judgment on
behalf of the Supreme Court in the case of Annie Bailes v Charles Anthony Stacy and
Another,155 held that:

“To establish a constructive trust there must be evidence that the property was acquired to
provide a home for a couple who intended to live together in a stable relationship, and that
the claimant made a substantial contribution towards its acquisition.”

This brings beforehand the fact that where an unmarried couple, for instance Miller and Kachepa,
with joint efforts, acquires property for their joint benefit and with an intention to settle together
in a home, there is a trust in which the man holds the property for himself and the mistress
beneficiary.

The learned judge in this case determined that a constructive trust is an equitable remedy where
one party in fairness should not be permitted to retain it. He further stated that it is a remedial
device available to a plaintiff to coerce the defendant to convey property by way of a constructive
trust.

This case highlights that a constructive trust is aimed at redressing wrong or unjust enrichment in
maintaining the basic principles of equity or justice. Thus, the High Court in this case held that a
constructive trust must be created. The reasoning behind this judgement was that, the applicant

153
Riches J. (2017) Optimize Equity and Trusts, 2nd Edition, Routledge, New York.
154
155
[1986] ZR 83.

183
satisfied learned judge on a balance of probabilities that she was entitled to an equitable remedy.
He found that indeed, there was joint effort in acquisition of the properties and, thus, held that the
applicant was entitled to 50 percent share in the properties.

This case also important because it outlines the significance of taking into consideration the best
interest of children in terms of their custody. On the matter regarding custody of children, the court
was guided by the Affiliation and Maintenance of Children’s Act Chapter 15(2) which provides as
follows:

“In making any order as to custody or access, the court shall regard the welfare of the child
as the paramount consideration, and shall not take into account whether from any other
point of view the claim of the father in respect of custody is superior to that of the mother,
or vice versa.”

Hence, the court made an of sole custody of the children to the applicant with reasonable access
by the respondent.

CONCLUSION

In conclusion, the subject matter is about how, despite the couple being unmarried, a constructive
trust can be imposed, as long as they jointly contributed to the acquisition of the property. As it is
known that a constructive trust does not have well defined terms or circumstances in which a court
of law must apply it, yet where justice and good conscience requires it to be impose, as well as to
prevent unjust enrichment, the courts of law will grant it as an equitable remedy for the purpose
of restituting the claimant.

184
STANBIC BANK V BENTLY KUMALO & 29 0THERS APPEAL NO. 182/2014

ABSTRACT

The decision in Stanbic bank Zambia limited V Bentley Kumalo and 29 others is an important
decision because it gives clarity on the position of law regarding the Limitation Act and pension
scheme evacuated by persons who have created a trust as employees of the company.

This article looks at the approach of the Supreme Court that took to the regard of the requirement
that one can commit fraud, that one can be fully entitled to the pension benefit and if there was
statute barred. Statute barred is the debt claim, which is no longer enforceable owing to the
prescribed period of limitation having lapsed.

INTRODUCTION

This was an appeal against the ruling of the high court, which found that the appellant charges
which are that there was fraud and statute barred and also employees were fully entitled to the
pension benefit hence forth the charges of the case were not pleading the appellant guilty of any
charge committed, so the first charge about fraud;

The High court neglected the letter, which was dated 23rd September, 1997, which explained about
Bentley Kumolo’s Pension schemes, and the High Court followed the letter, which was written
recently dated on 6 December 2007. However it was discovered there was Fraud and an illegal act
156
by the appellant, which is pursuant to section 19(1) (a) of the Limitation Act provides as
proffered, ‘’No period of limitation prescribed by this Act shall apply to any action by a beneficiary
under a trust being an action’’.

(a) ‘’In respect of any fraud or fraudulent breach of trust to which the trustee was a party or
a privy’’. Section 26 of the Limitation Act provides ‘’postponement of limitation period in
case of any fraud or mistake where, in the case of any action for which a period of
limitation’’.
That’s the reason why the High Court decided that there was fraud, the Supreme court accordingly
set aside the decision of the lower court in this matter and stated that there was no Fraud and for
one to prove that Fraud was committed, must have clear and sufficient evidence to support it.

156
1939

185
Associated Leisure Ltd V Associated Newspaper Ltd ERL, (1970) 2 Q.B 450. Fraud must, not
be decided only relying on facts. Fraud must, be pleaded with utmost particularity and not an obiter
dictum.

To this effect, it means that the learned Judge misdirected herself and that the issue at hand was
to prove whether the action of the respondent was statute barred and not to establish liability for
fraud on the appellant’s side as there was claim for fraud. Then the appeal was head that this case
should be distinguished with the case of standard chartered Bank Zambia Limited V
Kabindima Wotela and 163 others157 because in that case there element of concealment as the
employees where not aware of the actuarial valuation. Mr Bentley Kumalo and others were aware
of the withdrawal of their pension benefit, according to the letter dated 23rd September, 1997.
FACTS
On 6th November, 2013, the respondents commenced an action for a declaration that they were still
members of the appellant’s pension fund and as such were still entitled to payment of all full
pension benefits. In the alternative, they claimed of their contributions together with interest. The
appellant filed a conditional appearance on 21st November, 2013, denying the liability on the
ground that the respondent were only entitled to the appellant contribution at maturity or when
they transferred their credit to another scheme.

Appellant further denied liability on ground that the respondent’s membership to the pension fund
terminated on the date they left the appellant’s employment and received a refund of their
contributions as provided by the scheme rules. They denied liability on the ground that the
respondent’s claim was statute barred having accrued in 1996.
On 25th April, 2014, the appellant filed a summon under order 14A rule 1158 to dismiss the matter
for being statute barred as it was commenced 17 years after the cause of action accrued. This
application was opposed on the basis that the respondent were claiming the pension benefits held
by the appellant under a pension fund created by a trust deed of which the respondent were
beneficiaries.

157
(2016) zmc 254
158
R.S.C

186
The respondent exhibited a copy of the trust deed dated 1st July, 1975, made between the
appellant’s predecessor, Grindlays bank international Zambia (Zambia limited) and some
unnamed trustees. The respondent did not allege any fraud or concealment by the appellant in
their writ of summons, statement of claim or even the affidavit in opposition to the summon to
dismiss the matter for being statute barred.
HOLDING
The learned judge held that the appellant’s actions of selecting the option on behalf of the
respondents without their consent amounted to Fraud. She cautioned herself against commenting
further on the matters so as not to pre-empt her decision because the matter was still under
interlocutory stage, she then dismissed the application to dismiss the matter for being statute
barred.

The appellant later appealed on the following grounds;

1.) The court below erred in law and fact when it found the respondents’ action within the
provision of section 26 of the limitation act 159 when the respondents did not plead fraud in their
statement of claim.

2.)The court below erred in law and fact when it found that the appellant’s later of 6th December,
2007, constituted an acknowledgement of liability and dishonesty when this were unsupported
with the evidence on record.

3.) The court below erred in law and fact when it found that the claim of the pension benefit was
statute barred when it was commenced seventeen (17) years ago after the cause of an action
accrued.
SIGNIFICANCE
It is significant to note that the legal claim was for the courts to rule, whether or not the action of
the respondents’ claim was statute barred. As it was filled in the statement of claim by appellant in
the High Court. However, the high court diverged its focus on the matter of Fraud, which found
that the appellant was liable for Fraud. This led the appellant to appeal to the Supreme Court.

159
1939

187
The Supreme Court acknowledged and appreciated at the very nascent stages the writ of summon
revealed that the respondent were seeking a declaration that if they were still members of the
pension fund, payment in full of the benefits in the alternative and a refund of their contribution.

The statement of claim expanded on relief stock but made no mention of Fraud. The court added
that the affidavit in opposition to the summons to dismiss the matter for being statute barred does
not allege any fraud or concealment on the part of the appellant. Therefore, on this ground the
court distinguished the matter from the Bhura case. In Bhura case, the Supreme Court
acknowledged the necessity of specifically pleading fraud and in fact implored counsel in future
to include particular of the fraud as this is a requirement when pleading fraud. In Bhura 160case,
the pleading and evidence left the court in no doubt that there was fraud although the particulars
were not provided as required by order 18 RSC.

The supreme court in addition guided on how order 18/8/8 of 1997 of the rules of supreme court
required for one to plead Fraud as follows;

*Fraud- it is the duty of counsel not to enter a plea of the record “unless he has clear and sufficient
evidence to support it. Per Lord Denning in Associated leisure Ltd V Associated Newspaper
Ltd161. Any charge of fraud or misrepresentation must be pleaded with utmost particularity.

*Fraudulent conduct- must be distinctly alleged and as distinctly proved and it is not allowable to
leave Fraud to be inferred from the facts.

*Concealed fraud- when a pleader seeks to avoid the Limitation Act (1980) by pleading concealed
fraud under section 32, he must state his cased with the utmost particularity or the pleading may
be struck out under 19 or under the inherent jurisdiction of the court. The fraud alleged must be
Fraud of the person setting up the statute or someone through he claims.

160
, Appeal No. 146 of 2013.o. 146 of 2013
161
(1970) 2 QB 450

188
On the other hand, Fraud in this context envisages unconscionable conduct in regard to the
parties relationship and the conduct will not be regarded as “unconscionable” when he did not
know that he was committing fraud or acting in breach of trust and in such a case there would be
no concealment by him.

It is bad a practice to try to elicit fraud in examination chief and hope that it will not be objected
to do that, so that the Court can consider it. A plea of Fraud is a very serious crime or allegation,
which requires evidence beyond reasonable doubts or shadow of doubts. That is why in sithole v
the state lotteries board162, it was held that if a party alleges Fraud, the extent of the onus on the
party alleging is greater than simple balance of probabilities.
CONCLUSION
The ruling in this appeal is a very important one for it is drawing out that Courts must pay attention
to what the litigants are claiming for according to writ of summon. This further clarifies that the
Courts had to and must, in the future span of law establish greater standard of evidence, which is
beyond reasonable doubts in order to refrain others from committing the same crime, Fraud. It is
a rule is that the right people to be sued are the trustees and not the settlor to the benefit fund. This
precludes the appellant who in this case was but, a settlor.

It is directed that the retirement benefits to be recovered must be claimed in lawsuit within six (6)
years should there be any mistakes or fraud in the pension benefit and there must be consolidated
evidence to prove if there was a fraudulent act. Therefore, the party alleging a fraudulent action
ought to posit sufficient evidence in order to get through.

162
(1975)Z.R. 106

189
MOOBOLA V MUWEZA (1990 – 1992) Z.R. 38 (S.C.)

ABSTRACT

The ruling of MOOBOLA v MUWEZA is a vital decision because it explains the issue regarding
the retrospective of the statement when the person dies before the commencement of the intestate
succession Act NO 5 of 1989.

This piece of writing is at the approach the court took regarding to the distribution of estate of a
deceased when he died before the commencement of the Act and it looks forward to clarify the
issue pertaining to retrospective of statement.

INTRODUCTION

This was an appeal against the dismissal of the appellant claim that she was the lawful widow and
relict of Dr Saul Muluba Moobola “the deceased”. He (the deceased) died intestate and being
indigenous the customary laws would apply to his estate unless it caught by the intestate
Succession Act. 5 of 1989, which was a law enacted to alleviate the plight of, especially, widows
and children who would otherwise be at the mercy of the actions of the largely ambiguous and
malleable customary inheritance practices. The ruling of the lower court was set aside by the court
of appeal and the case was remitted for the hearing to proceed on the merits. The cost of this appeal
follow the event.

FACTS

The deceased died the day before the Intestate Succession Act. 5 of 1989 had been enacted, and
just over two months before it came into effect. The appellant, who alleged that she was his lawful
wife, contended that the Act applied to the deceased's estate. Section 48 of the Act provided that
the Act did not affect any rights, duties or obligations of an administrator under any law relating
to the administration of estates existing immediately before the commencement of the Act or of
beneficiaries in respect of any person who died before the commencement of the Act.

The Act came into effect on 28th July, 1989. The respondent obtained a grant of the letters of
administration sometime in July,1989. The appellant issued the originating summons on 16th
August, 1989, in which she asked for two things, namely, that it be ordered that she was entitled
to a widow's 20% share of the estate under the said Act and further that certain personal chattels

190
and property belonging to her in her own right and which were lying in the family home be
surrendered to her and not be administrated by the respondent as part of the deceased's death so
that it should not apply to this estate and the appellant ought not to be heard under this Act. It
appeared that the applicant would, if she was the deceased's lawful wife, be entitled to inherit a
portion of his estate, even if customary law applied. In terms of the Act as a widow she would
have been entitled to a 20% share.

HOLDING

That the Act was concerned with the administration and distribution of a customary intestate
estates. Section 48 precluded the acquisition of newly created substantive rights or the imposition
of newly created disadvantages in an ongoing administration as well as in one which was finalised
at the time of the commencement of the Act and could only be regarded as prospective in its
operation. Further, that the fact that the Act had fixed a quantum to existing rights claimed by a
widow in respect of an estate which had not yet been administered did not mean that there was to
be retrospective operation. Since the whole of the administration and distribution of the estate of
the deceased was to take place in the future, after the Act. After hearing arguments, the learned
trial judge upheld the objection and dismissed the whole of the summons.

SIGNIFICANCE

In the first instance, it is clear that it was wrong to dismiss the whole action when there were two
distinct claims and the objection could not conceivably apply to her claim for the return of personal
property and its exclusion from the assets of the estate. It is obvious that this part of the appeal has
to be allowed and this part of the action remitted below for the hearing to continue on the merits.
The major issue is whether the appeal should also be allowed on the claim under the Act so that it
too should be remitted below for the hearing to continue on the merits. The problem arises from
the timing between the death of the deceased and the commencement of the operating of the Act.
The respondent argued that, having regard to the wording of s. 48 of the Act, this Act could not be
made to apply to the estate of the deceased nor to the rights of the appellant in such estate. Section
48163 reads:

163
Intestate succession Act. 5 of 1989

191
''Except as is expressly provided, nothing in this Act shall affect:

(a) Any rights, duties or obligations of an administrator under any law relating to the administration
of estates existing immediately before the commencement of this Act; or

(b) The rights, duties or obligations of beneficiaries in respect of any person who died before the
commencement of this Act.''

The arguments and the decision below centred on the question whether or not the Act has
retrospective effect and since it was found not to have such effect the application could not be
entertained where the death occurred before the commencement. In view of the wording of s. 48
which we have quoted, it seems to us to be beyond debate that the Act is in its direct operation
prospective. The appellant argued that, because the whole of the administration and distribution of
the estate would take place after the commencement, the Act must apply to the estate in this case.
The respondent , on the other hand, contended that the Act could not apply so as to affect the rights
of beneficiary where the deceased died before the commencement.

As we see it, care should always be taken not to allow the ambiguous nature of the word
'retrospective' to cloud the interpretation of a statute such as this. As the learned authors of
Asbury’s Laws of England, 3rd ed., vol. 35, put it at para. 543:

''It has been said that the word 'retrospective' is somewhat ambiguous and that a good deal of
confusion has been caused by the fact that it is used in more senses than one. In general, however,
the courts regard as retrospective any statute which operates on cases or facts coming into existence
before its commencement in the sense that it affects, even if for the future only, the character or
consequences or transactions previously entered into or of other past conduct. Thus a statute is not
retrospective merely because it affects the existing rights; nor retrospective merely as part of the
requisites for its action is drawn from a time antecedent to its passing.''

The court had to be established if in fact she was the lawful widow, a fact denied by the respondent.
Once the latter fact was established, the Court would have had to consider whether, under the
relevant customary law, the widow has the rights of a beneficiary and is therefore entitled to a
share in the estate of her late husband. If this is the case (and we have no reason to doubt that this
is one of the customs of the people of Namwala) then the widow would be entitled to a share in
any event, whichever law is applicable. Indeed, the respondent in this affidavit seemed to

192
acknowledge that a widow would have such rights but blamed the appellant's parents for refusing
to attend a meeting to discuss the estate and for alleging that there was no marriage.

As already noted, s. 48 of the Act makes it clear that the rights of a widow as a beneficiary of
someone who died before its commencement cannot be affected by anything contained in this Act.
The word ''affect'' is an ordinary English word and the section can be understood to mean, among
other things, that the previously existing rights of such a beneficiary cannot be violated, invalidated
or altered to his disadvantage. Section 48 was necessary, in our considered opinion, to cover those
situations where the administrator had already discharged his functions or taken some steps under
the customary law previously applicable and when it would be necessary to offer him protection
and to relieve him of any adverse claims or liabilities which may have just arisen or been created
by the statute. Similarly, s. 48 was necessary to offer like protection to beneficiaries who had
already taken a benefit or assumed duties or obligations. It would also operate to bar such
beneficiaries from reopening administrations which have been finalised with a view to take
advantage of the better terms offered by the Act. The appellant's claim, if she establishes that she
was the lawful widow, would amount to no more than that her existing rights should now be
quantified as a definite and fixed 20% of the estate rather than the previously indeterminate share
to be fixed at the mercy of customary practices. In this regard, the court we do not consider that
the Act has created any new substantive rights but it has merely specified the quantum of the
entitlement already due to a widow in the position of this appellant.

The Act is concerned with the administration and distribution of a customary intestate estate. As
we have endeavoured to illustrate, the wording of s. 48 precludes the acquisition of newly created
substantive rights or the imposition of newly created disadvantages in an ongoing administration
as well as in one which was finalised at the time of the commencement of the Act. As the Act is
concerned with administrations and distributions after its commencement, it can only be regarded
as prospective in its operation and the question of retrospective operation does not even arise. This
brings us to the question whether the application of the quantum fixed by the Act to the share of a
widow whose rights as a beneficiary are not affected results in any retrospective operation of the
Act. The respondent in effect argued that this would be the result because the deceased died before
the commencement and s. 48 meant that she was stuck with whatever share the customary law
would produce. The respondent position was that this new Act should not even apply to such

193
estates and this view was upheld by the Court below. We respectfully disagree with this view.
164
Section 2 of the Act makes it clear that it shall apply to all persons domiciled in this country
who are subject to customary law. As already discussed, s. 48 makes provision for administrators
and beneficiaries in respect of estates whose administration was either completed or pending at the
time of the commencement of this new Act. There is no suggestion in s. 48 that applications cannot
be made by a beneficiary in the appellant's position. What is more, there is nothing in s. 48 which
precludes the intended prospective operation of the Act where no new substantive rights are
claimed and no new disadvantages are sought to be imposed. We are, of course, aware that the
appellant sought to attack the decision below on an argument that the Act was intended to have a
retrospective affect. We do not agree with him either. However, he had an alternative submission
which was on firmer ground. The appellant's claim under the Act is in fact supportable on the basis
that it attracts the operation of the Act in the prospective manner in which it was so clearly intended
to operate. The fact that the Act has fixed a quantum to existing rights claimed by a widow in
respect of an estate which has not yet been administered does not mean that there is to be
retrospective operation. In this regard we cite Master Ladies Tailors Organisation and Another
v Minister of Labour and National Service165. We also draw attention, once again, to para. 643
in Halsbury's Laws of England already quoted. In any case, the presumption against retrospection
does not apply to legislation dealing with matters of procedure, and provisions introducing new
remedies, as opposed to new substantive rights, have generally been classed with provisions as to
procedure so that they generally apply both to proceedings subsequently commenced in respect of
existing causes of action and to existing proceedings: see, generally, para. 647, Halsbury's Laws
of England, 3rd ed., vol. 36. It follows from the foregoing that we are persuaded by the appellant
alternative submission based on the fact that the whole of the administration and distribution of
the estate of the deceased in this case is to take place in the future, after the Act has come into
effect, and when only its prospective operation will be called upon, as we have attempted to
adumbrate.

164
Intestate succession Act. 5 of 1989
165
(1950)2All E.R. 525.

194
CONCLUSION

The ruling in this case is a pivotal, in it’s interpretation of the intestate succession Act No 5 of
1989 and its application to estates where the deceased passed away before the Act`s
commencement. The case emphasizes that the Act operates prospectively, meaning it applies to
administration and distributions occurring after its enactment, without retroactively altering
existing substantive rights or imposing new disadvantages. The court`s analysis underscores the
importance of balancing customary practices with statutory law to ensure fairness in estate
distributions, particularly in safeguarding the rights of widows and other beneficiaries.

By clarifying the Act`s intended scope and effect, the ruling provides guidance for future cases
involving intestate succession and contribute to the development of legal principles governing
inheritance law in the jurisdiction.

195
MWENYA & ANOTHER V KAPINGA (S.C.Z. JUDGMENT 4 OF 1998) [1998] ZMSC 12
(30 NOVEMBER 1998.

ABSTRACT

The holding in the case of Mwenya & another v Kapinga is of great principle as it sets precedence
over cases involving disputes over land ownership. The court’s decision in the case proclaims a
perspective of a clear rule and provides much-needed clarity in resolving disputes over land.

The case establishes that the first party to purchase land is entitled to ownership, even when the
second party later claims to have purchased the same land. This decision has hence been referred
to and used in cases involving disputes of this nature making it a highly influential case.

INTRODUCTION

This is an appeal by the appellant against then judgment of the high court granting the respondent
specific performance of a contract for the sale of plot No. 4109 Lusaka to the respondent by the
first appellant.

FACTS

The 1st appellant agreed to sell her house to the respondent for the sum of K12,000,000.
Meanwhile she asked the respondent to pay up K800,000 to enable her redeem the mortgage under
which the house was. The respondent paid the said amount and the 1st appellant redeemed the
mortgage accordingly.

But when the respondent wanted to pay the rest of the purchase price, the 1st appellant refused to
accept the money saying the 1st appellant had taken too long to find it. She then signed a second
contract of sale with the 2nd appellant and the respondent sued.

HOLDING

The holding of the case refers to a specific rule that the court established. In the case, the holding
was that the first party to purchase land is entitled to ownership even if the second party later
claims to have purchased the same land.

196
The rule was based on the principle for the first time, first in right. In other words, the party to take
action is entitled to association rights this principle is mainly applied in many areas of the law
including land ownership. Finally, the court dismissed the appeal.

SIGNIFICANCE
The appellants abandoned grounds 1 and 7. They argued grounds 2-6. The learned advocate for
the appellants, Miss Sharp contended in ground 3 that the learned trial judge erred in law by
holding that a valid contract was in existence when there was no evidence produced before it to
prove such contract.
What was in existence was a preliminary agreement which was not enforceable in the absence of
a formal contract of sale.
She argued that the correspondence between the 1st appellant and the respondent amounted to a
preliminary negotiation which was included to culminate into a concluded contract but from which
either party could retire before the formal contract concluded. she then referred the court at
Halsbury's Law of England 3rd Edition Vol. 34 page 192.166
In ground 3 Miss Sharp submitted that the court below erred in law by granting the remedy of
specific performance to the respondent when there was a more appropriate remedy of damages
since there was a bona fide purchaser for value without notice as evidenced in the case of Pacific
Mother Auctions Private Limited v Motor Credit (Hire Finance) Limited.167
She argued ground 5 that in the alternative, if this court finds that the 1st appellant's letter of 25th
August, 1992 amounted to a valid contract, then the p15 Judge erred both in law and in fact by not
finding that the contract was terminated by the respondent's own breach.
In ground 6, miss sharp submitted that the court below erred in law by applying the sales of good
act 1893168 to transaction involving sale of lands. The respondent’s advocate, Mr Musaba of
Mungomba and associates responded to five grounds of the appellants grounds of appeal. He said
the appellants grounds of appeal is misconceived in that ther is sufficient evidence of an concluded
contract between the first appellant and the respondent which contract neither left anything to
future treaty nor specifically stated that the parties would treat the said contract merely as
preliminary agreement or subject to a further or formal contract to be drawn.

166
Halsbury's Law of England 3rd Edition Vol. 34 page 192
167
[1965] 2 ALL E.R 105
168
Sales of goods act 1892

197
Mr musaba argued that the sufficient note or memorandum as desired by the statute of frauds
1677 169 being the first appellant letter of offer to the respondent dated 25th august, 1992, did not
indicate that the sale transaction was subject to a formal contract to be drawn up nor is such an
inference capable of being drawn from the said letter.
In any case, the preliminary negotiations were held by the parties prior to the letter of offer in
reference to page 25 of the record of appeal and fry and specific performance 8th edition page
506-508.
To continue, however with the narrative, it was his submission in the further alternative he argued
ground 3 that notwithstanding the fac that completion was to be within thirty days from then date
of contract, the court did not fall into error in law when it held that the contract between the 1 st
appellant and the respondent and the respondent was unconditional in respect of time of
completion in that there was nothing in the aid letter indicating that the time was of essence of the
contract.
He said the holding of the judge in then respect ought not to misconstrued as having implied that
then contract between the parties was unattended by conditions in its entirety but even though the
parties agreed nor agree nor intend that time be of essence of the contract in reference to Cheshire
and Fitfoot’s law od contract 10th edition 499 paragraph 1-3170
More to this, nothing om page 25 indicates that time was of the essence making clear that a contract
can only be repudiated if a notice in the stipulated period. The case of of Dennis Lyuwa v Cold
Storage of Zambia171

CONCLUSION
Conclusively, it may be said that time is essentially the first element in consideration when the
parties expressly stipulated in a contract that it ought to be so. In a case where a party has been
guilty of undue delay, he is notified by the other party and specific performance is completed
within reasonable time. Lastly, if the nature of the subject matter make makes it imperative clear
that the agreed date should be precisely observed.

169
Statutes of frauds 1677
170
Cheshire and Fitfoor’s Law of contract 10th edition paragraph 1-3.
171
[1992]

198
DEVELOPMENT BANK OF ZAMBIA V JCN HOLDINGS LIMITED & OTHERS
(APPEAL 54 OF 2016) [2019] ZMSC 21 (20 MARCH 2019)
ABSTRACT
It is without trite contention that the position of the court in this appeal case plays a tremendous
role in the Zambian jurisdiction. This is an appeal case which was made with respect to orders of
the rules of the supreme court to add parties to a cause of action and the rules of the high to amend
the writ of summon and the statement of claim. In the course of the proceedings, the appellant
became desirous of joining the four intended parties to the action. In pursuance of that desire, the
appellant filed several applications.
INTRODUCTION
This was an appeal was against mainly the refusal by the supreme Court mainly against the ruling
by the high court to join other parties to this action. It is made under order 15 rule 4172 of the rules
of the supreme court (unit book) seeking to join the parties sought to be joined are, Mines Air
Services Limited, Zambian Airways Limited, Fred Mmembe and Nchima Nchito, SC.
FACTS
According to the appellant, the joinder of the intended parties necessitated setting out specific
claims against the new parties; and also recasting the existing claims against the current parties. It
also necessitated re-casting the averments in the statement of claim. The appellant exhibited the
proposed amended writ of summons and statement of claim.
The court briefly briefly mentioned some of the proposed claims and averments because they, by
and large, charted the direction which the arguments took. So, there was a proposed claim for one
as advanced. Another claim was proposed for an order that the present defendants, together with
Messrs Fred Mmembe and Nchima Nchito fraudulently omitted to facilitate the common stock
equity arrangement.
There was a claim for an order to be made pursuant to Section 383 of the Companies Act173 that
the current respondents together with Messrs Fred Mmembe and Nchima Nchito be held personally
liable for the loan of K 14 billion. There was a claim for an order that the corporate veil of Mines
Air Services Limited be pierced so that the current.

172
Order 15
173
Companies Act

199
The court below court misdirected itself in law and in fact when it held that Messrs Nchima Nchito,
Fred Mmembe, Mine Air Services Limited and Zambian Airways Limited should not be added as
parties to the action on the grounds that: 1
I. The plaintiff had not 'put across a strong and convincing case as to why they should be
joined as defendants to these proceedings apart from attempting to lift the corporate
veil'
II. That the cause of action was statute barred.
III. That Messrs Nchima Nchito and Fred Mmembe' were not privy to the syndicated loan
agreement, neither do they come into the picture as having played any role in their individual
capacities so as to qualify them as def end ants in this matter. They were not parties to the
syndicated loan agreement which was executed between Mines Air Services Limited and Zambian
Airways and the plaintiff
2. The court below erred in law and in fact when it failed to invoke the doctrine on piercing
the veil of incorporation so as to justify the inclusion of Messrs Nchima Nchito and Fred Mmembe
as defendants to the action.
3. The court below misdirected itself when it held at page R54 that: - 'the plaintiff in
bringing this application has placed reliance on Section 383 of the Companies Act. That provision
deals with winding up of the company which is not the case with the current p8roceedings. This
application therefore is improperly before this court'
4. The court below erred both in law and fact when it refused to expunge the witness
statements of Richard Phiri and James Bilias Kapesa on the basis of their contracts of employments
with the plaintiff'.
HOLDING
The court held that the view that the appeal with regard to the intended joinder of the new parties
had no merit. It was held that the court below was on firm ground in refusing to grant the
application of the joinders of the party to that action.
With regard to the fourth ground of appeal, the court had read the authorities which the appellant
relied on in its submissions regarding the fiduciary duty which the proposed witnesses owed to the
appellant. We note that, in all these cases, the action was against a party that was alleged to have
breached their fiduciary duty.

200
So, all the principles that had set out in those cases were made against that background. What we
have in this case is an objection to the reception of evidence from people who are alleged to owe
the appellant a fiduciary duty.
While in an action against them for breach of fiduciary duty the court decided against them, we do
not think that the court should go so far as to prevent them from breaching their fiduciary duty
considering that a remedy exists in the form of an award of damages for breach of such duty.
The court, therefore, agreed with the court below that the duty that the two respective witnesses
had owned to the appellant is not on the same footing as that between a lawyer and client to warrant
injuncting the witnesses from testifying. Consequently, the court found no merit in the ground.
Hence, dismissal of the appeal.
SIGNIFICANCE
The supreme court appreciated the Court Limitation Act, 1939174 which provides that actions
such as this one should be commenced within six years and yet the appellants were seeking to
2join the parties well after six years from the time that the cause of action had accrued.
The first limb of the proposition by the appellant suggested that there was a provision in the
Limitation Act, 1939 which state that where a party seeks to pierce the corporate veil, the
limitation placed by the act is waived.
The court appreciated part II of the Limitation Act, which provides for extension of the limitation
period in certain instances and those were;
Where the person to whom a right of action had accrued was under a disability, where
there has been acknowledgement and part payment and where the action is based on
the fraud of the defendant or agent or where the right of action has been concealed by
the fraud of any such person or where the action is for relief from the consequences of
a mistake.
Clearly, there was no provision for the waiver or extension of the limitation period where the action
is intended to be for the purpose of lifting the corporate veil.
Coming to the second limb of the argument then court too into keen consideration that, quite apart
from the fact that was held in Access Bank (Zambia) Limited v Group Five/Zcon Business
Park Joint Venture'161175 that the Constitution never means to oust the obligations of litigants

174
Ibid
175
[2016] ZMSC 24

201
to comply with procedural imperatives, the limitation period imposed for any action to be brought
is a fundamental aspect of the action.
Regarding the refusal to join Messrs Fred Mmembe and Nchima Nchito, the appellant took a swipe
at the High Court's reasoning that the two parties intended to be joined were not party
to the relevant contract and could therefore not be joined to the action. Mr Mutale, S.C, on behalf
of the appellants, argued that the application in the court below was clearly aimed at piercing the
veil of incorporation.
He submitted that to lift the veil of incorporation is precisely to look beyond the names or
companies in the transactions and lay bare the dealings of the people behind the company. State
Counsel argued that, in the light of the purpose of lifting the corporate veil, it begged the question
to say that the corporate veil could only be lifted if the shareholders and directors were party to the
contract involving the company.
Learned State Counsel also took issue with the reasoning given by the court below for dismissing
the appellants' reliance on section 383 of the Companies Act,176 namely that the section only
applied to winding-up proceedings. It was State Counsel's argument that, in the Court's reasoning,
no attempt was made by it to justify its omission of the words "or any proceedings against a
company".
The court was referred to the works of Maxwell on Interpretation of Statutes177 and the case of
The Attorney General & Another v Lewanika & Others178 for the principle regarding the literal
rule of construction of statutes and documents.
Relying on the court’s decision in Ethiopian Airlines Limited v Sunbird Safaris Limited,179
Soshma's Investment Holding Limited and Vijay Babula180 which held that the managing
director of a company ought to have been held personally liable for the company's debts, learned
state counsel argued that under section 383 (1)
‘’once a court is satisfied that a person was knowingly a party to the carrying on of any business
of the company for a fraudulent purpose, it can make an order that the person shall be personally
responsible for any liability for the debts or other liabilities of the company.’’

176
Ibid
177
Maxwell on interpretation of statutes 12th edition.
178
[1993] ZMSC 93
179
[2007] ZR 235 2 S
180
[2007] AC 22

202
With regard to ground 1 (ii) of the grounds of appeal, the only argument advanced was that the
action against the intended parties must be allowed to be heard notwithstanding that the said parties
were not joined within the time stipulated by the statute of limitations. For this submission, reliance
was placed on Article 118(2)(e) of the Constitution of Zambia181 which states:
"(e) justice shall be administered without undue regard to procedural technicalities"
CONCLUSION
The decision in this matter is of a vital stance as it puts to bright light the principle that a party
cannot be included in an agreement when the time period has elapsed and the said party cannot be
included in an agreement pursuant to the limitations act 1939182 while making reference to the
equitable maxim, equity aids the vigilant and not he who slumbers on their rights, the provisions
of the limitations act, 1939183 as well as order 15 rule 4184.

181
Constitution of Zambia
182
Limitation act 1939
183
Ibid
184
Ibid

203