The document outlines the definition, criticisms, functionalities, classifications, and types of trusts in law. It explains the difference between completely and incompletely constituted trusts, as well as the various forms of express trusts, including testamentary and inter vivos trusts. Additionally, it discusses constructive and resulting trusts, emphasizing their reliance on equity principles and the circumstances under which they are recognized.

1. THE LAW OF
TRUSTS
FLAW 407

2. DEFINING A TRUST
•According to Underhill & Hayton, Law of Trusts and Trustees (14ed.) a Trust is:
“An equitable obligation binding a person (who is called a
trustee) to deal with property over which he has control (which
is called the trust property for the benefit of persons (who are
called beneficiaries or cestui que trusts), of whom he may be
one, and any one of whom may enforce the obligation.”

3. IS THE DEFINITION IN UNDERHILL’S LAW OF
TRUSTS PERFECT?
Criticisms of the definition
• 1. Trusts are not created for only human beings; a trust may have non-
human beneficiaries. e.g. a trust for the maintenance of a tomb;
• 2. The definition does not cover charitable trust;
• 3. Not all beneficiaries are entitled to enforce a trust.

4. TRUSTS AND OTHER LEGAL CONCEPTS
It is better to describe than to define a trust, and then to distinguish it from related but
distinguishable concepts. The related concepts are:
• Agency,
• bailment,
• contract,
• debt,
• power,
• administration of estates.
NB: Read Kludze’s Modern Principles of Equity, Chapter 8, for a discussion of these concepts.

5. WHY CREATE A TRUST?
1. Proper management of resources;
2. To enable property to be held for persons who cannot hold the legal title to
property;
3. A trust allows the enjoyment of rights to be split on a plane of time or it enables
property to be used to benefit persons in succession.
4. Protecting assets
5. Avoiding compulsory succession.
6. Tax exemptions

6. CLASSIFICATION OR KINDS OF TRUSTS
• They may be broadly classified as Private and Public trust. This division is according to their
purpose.
• Private trust
• “A private trust is for the benefit of an individual or class of individuals, even if the benefit may be
incidentally conferred on the general public.” (Kludze, Modern Principles of Equity)
Private trusts are divided into:
• 1. Express Trust;
• 2. Constructive Trust and
• 3. Resulting Trust.

7. EXPRESS TRUSTS
• An express trust is one that is intentionally created by the holder of rights when he
or she effectively declares a trust. This may be done by a trust instrument or a will.
Testamentary and inter vivos trusts
• This is a simple distinction, applying to express trusts. A testamentary trust is an
express trust which is set out in a person’s will, and comes into operation when the
testator dies and his will is executed.
• All testamentary trusts must comply with the formalities of the Wills Act, 1971
(Act 360). Accordingly, among other requirements, it must be in writing.

8. EXPRESS TRUSTS
• Typically, executors are also the first trustees of any trust which arises under
someone’s will. If not, the executor must vest the trust property in the trustee by
a vesting assent. See Administration of Estates Act, 1961 (Act 63) section 96(1).
• An inter vivos trust is one which is created by a settlor to take effect in his life
time. A settlor could even name himself or herself as trustee or even beneficiary.
Most express inter vivos trusts are declared in writing (trust deed). However,
inter vivos trusts of personal property may be made orally, but a written
document is necessary for the transfer of land.

9. EXPRESS TRUSTS
• Executed and Executory trusts
An executed trust: is one in which the precise interests of the different beneficiaries or
charitable purposes are determined at the outset in the trust instrument; the trustee has no
decisions to make as to how the value of trust assets should be distributed.
Egerton v. Lord Brownley 10 ER 359.
An executory trust: is one where the trustee has a ‘dispositive’ discretion as to how the assets
or beneficial rights are shared. Discretions
NB: The ‘executed’ or ‘executory’ nature of a trust turns upon whether the trustee has
discretion in his distribution of the trust assets.

10. EGERTON V. LORD BROWNLEY 10 ER 359
• John WilIiam Earl of Bridgewater devised his freehold estates to trustees, in trust to
convey them to the use of Lord Alford, his great-nephew, for ninety-nine years, if he
should so long live ; remainder to trustees and their heirs during the life of Lord
Alford, in trust to preserve contingent remainders ; remainder to the use of the heirs
male of the body of Lord Alford, with diverse remainders over: provided that, if Lord
Alford should die not having acquired the title of Duke or Marquis of Bridgewater,
the estate directed to be limited to the heirs male of his body should cease, and the
estates should thereupon go over and be enjoyed according to the subsequent uses
and limitations directed by his will. Lord Alford died leaving a son, but without
having acquired the title. Held, that the proviso was valid.

11. EXECUTED TRUSTS
Contingent or defeasible interests
A beneficiary may receive a contingent or defeasible interest under a trust. A
contingent interest is one which will only arise if a certain event occurs. A
defeasible interest is one which may come to an end upon a certain event.

12. EXPRESS TRUSTS
Completely and incompletely constituted trusts
• Completely constituted: A trust is said to be completely constituted when the trust
property has been vested in trustees for the benefit of beneficiaries. Until this is done,
the trust is incompletely constituted.
• Antrobus v. Smith (1806) 12 Vesey 39; An attempted transfer of shares by the
• mere endorsement on the back of a share certificate was clearly ineffective to
• pass legal title to the intended transferee
• Re Rose [1949] 1Ch.78.

13. COMPLETELY CONSTITUTED TRUSTS
• If it is a trust of land, there is the need for the transfer to be in writing. If the land
is unregistered there must be a conveyance.
According to section 34 of Land Act 2020 (Act 1036):
A contract for the transfer of an interest in land is not enforceable if it is
not (a) evidenced in writing, and (b) signed by (i) the person against
whom the contract is to be proved; or (ii) a person who was authorised
to sign on behalf of that person; or (c) exempt under section 36.

14. COMPLETELY CONSTITUTED TRUSTS
Section 35 of the Land Act also states that:
• Mode of transfer 35. (1) A transfer of an interest in land other than a transfer
specified in section 36, shall be in writing and signed by (a) the person making the
transfer or by the agent of that person duly authorised in writing; and (b) the person
to whom the transfer is made or the agent of that person duly authorised in writing.
• NB: Sections 34 and 35 do not apply to a transfer or contract for the transfer of an interest in land which
takes effect (a) by operation of law; (b) by operation of the rules of equity relating to the creation or
operation of resulting, or constructive trusts;

15. COMPLETELY CONSTITUTED TRUSTS
• Where the subject matter of the trust is registered land, it must be transferred in accordance
with section 132 of Act 1036.
• Disposition of registered land and registered interest in land
132(1) Despite the provisions of any enactment to the contrary, land
or interest in land registered under this Act shall be disposed of in
accordance with this Act, and a disposition of land or interest in
land otherwise than in accordance with this Act shall not create,
extinguish, transfer, vary or affect a right or interest in the land.

16. COMPLETELY CONSTITUTED TRUSTS
• If it is movable property, conveying it to the trustee may be sufficient. It can also be transferred by deed. A trust arising under a will may be a
completely constituted trust because, generally, the will vest the property in the trustee.
• Milroy v. Lord 1861-73 All ER Rep 783;
• Milroy v. Lord (1862) 4 De
GF & J at pages 274-275 of the report as follows:
“...in order to render a voluntary settlement valid and effectual,
the settlor must have done everything which, according to the
nature of the property comprised in the settlement, was
necessary to be done in order to transfer the property and
render the settlement binding upon him
• Richards v. Delbridge (1874) LR 18 Eq 11.
•A completely constituted trust can be enforced by the beneficiaries whether or not they have given consideration.

17. MILROY V. LORD 1861-73 ALL ER REP 783
• Thomas Medley held shares in a company called the Bank of Louisiana, and wished to transfer
them. The bank required the shares be transferred according to regulations in the company
constitution. He wanted to give them to his niece, Eleanor Milroy (maiden name Dudgeon). He
signed a deed in Louisiana with Samuel Lord, for Lord to hold 50 shares on trust for Eleanor. (This
was in fact made in consideration of $1, but this was ignored.) He also gave Lord a power of attorney
to receive dividends on the shares and to comply with the company constitution's formalities. Lord
did not actually do it. Thomas Medley lived for three years after signing the deed with Samuel Lord,
in which Samuel Lord was receiving dividends and passing them on. When Thomas Medley died the
shares still remained in his name. Eleanor Milroy claimed that the shares belonged to her.
• Stuart VC held that a trust had been created for Eleanor, and the decision was appealed.

18. • Held (Court of Appeal)
• No, the legal and beneficial title remained with the settlor.
• Turner LJ
• Equity will not perfect an imperfect gift: p. 1189 – 1190A
• To perfect a gift, the transferor must do everything necessary according to the nature of the property.
• Property may be gifted in one of three ways:
• Transfer of absolute title;
• Transfer to a trustee; and
• Settlor declaring himself as trustee.
• If the gift is intended to take effect one way, equity will not allow it to take effect by another, thus a transfer of absolute title will not take effect as a declaration
of trust.
• Current case: p. 1190B
• The shares were intended to be held on trust by L for M and it was never intended by the settlor that he himself will hold it on trust.

19. INCOMPLETELY CONSTITUTED TRUSTS
• A trust is said to be incompletely constituted when the trust property has not
been vested in trustees for the benefit of beneficiaries. A trust that is not
completely constituted is generally not enforceable by the beneficiaries, unless
they have given consideration because equity will consider as done what ought
to be done and will not aid a volunteer.
• Gateway Worship Center vrs. Soon (J4/12/2008) [2009] GHASC 7 (21 January 2009.)

20. GATEWAY WORSHIP CENTER VRS. SOON
• From the facts of the instant case, it appears that the church has not given
any valuable consideration in respect of the trust. Counsel may, therefore, be
right in referring to it as a volunteer under the trust. The position is that
equity does not assist a volunteer (see Ellison v. Ellison) (supra). However,
this position is true only when the trust is incompletely constituted. Where the
trust is completely constituted, it does not matter whether or not the
beneficiary is a volunteer (see Re Adlard) (supra).
From the evidence on record, it is very clear that the philanthropist, Rev. Yei
Jae Im, completely vested the funds raised in Korea (the subject matter of
the trust) in the appellant as trustee, which funds the appellant even kept in
his own bank account as the legal owner. The trust in question is, therefore,
completely constituted. Thus, whether or not the 2nd Respondent is a
volunteer in equity is irrelevant, the trust having been completely constituted
or perfected. The trust is, therefore, enforceable by the 2nd Respondent.
Accordingly, Ground Three of the appeal fail

21. JEFFERYS V. JEFFERYS
• The contrast between a completely and an incompletely constituted trust as
regards volunteers is clearly depicted in the case of Jefferys v. Jefferys
(1841) Cr & Ph 138. In that case, a father, by a voluntary settlement,
conveyed certain freehold estates to trustees in trust for the benefit of his
daughters. The conveyance was complete. He further covenanted to
surrender certain copyhold estates to the trustees in trust for the benefit of
the same daughters. The mode of conveyance of copyholds was by surrender
and admittance. The conveyance in respect of the copyhold estates was,
however, incomplete. Subsequently, he devised part of the same estates to
his widow who, after his death, was admitted to some of the copyholds. It
was held that, as to the freeholds, the trust in favour of the daughters was
enforceable by them, since the trust was completely constituted by the
complete conveyance thereof to the trustees. But, as to the copyholds, the
trust was not complete and, therefore, it was unenforceable by the intended
beneficiaries, namely the daughters.

22. CONSTRUCTIVE TRUSTS
Lord Denning in Hussey v Palmer (1972) 3 All E.R. 70 described a constructive trust as:
“By whatever name it is described, it is a trust imposed by law whenever justice and
good conscience require it. It is a liberal process, founded upon large principles of equity, to
be applied in cases where the defendant cannot conscientiously keep the property
for himself alone, but ought to allow another to have the property or a share in it. It is an
equitable remedy where the court can enable an aggrieved party to obtain restitution.”
•The principle of “unjust enrichment” lies at the heart of the constructive trust. See also the
case of Saaka v Dahali [1984-86] 2GLR 774.

23. CONSTRUCTIVE TRUSTS
• There are certain factual circumstances that will cause the court to recognize such
a trust.
1. Profit from fiduciary relationship
2. Profit from crime
3. Profit from mistake

24. CONSTRUCTIVE TRUSTS
PROFIT FROM A BREACH OF FIDUCIARY RELATIONSHIP
• Where a fiduciary makes a profit in breach of that duty, usually by using privileged
information or diverting a profit making opportunity to himself instead of the
person to whom the duty is owed, the profit is held on a constructive trust for the
person to whom the duty is owed.
• Boardman v Phipps [1967] 2 AC 46.
• Keech v. Sandford 25 E.R 223.

25. CONSTRUCTIVE TRUSTS
PROFIT FROM CRIME
Bribes or secret profits received by fiduciaries
It is unconscionable for a fiduciary to obtain and retain a benefit in breach of his or her
duties. A fiduciary who obtains a benefit from committing a crime or an
unconscionable act in breach of his duties to another, may hold the benefit on a
constructive trust and is under a duty to pay and account for the benefit to the person
to whom that duty was owed. AG For Hong Kong v. Reid (1993)3 WLR 1143.
Unconscionable/knowing receipt of trust property disposed of in breach of trust
•A person who knowingly receives trust property holds it on a constructive trust for the beneficiaries.

26. CONSTRUCTIVE TRUSTS
PROFIT BY MISTAKE
A party who obtains an advantage over others, as a result of a mistake and
contrary to a common intention, may be held to be a constructive trustee of the
benefit acquired thereby.
Brown v Brown 152 S.W.3d 911, (Mo. Ct. App. 2005)

27. FIDUCIARY UNDER CONSTRUCTIOVE TRUST
• A person in a fiduciary position is not permitted to
profit from his position (see Re Biss [1903] 2 Ch 40). The general principle,
as stated in the locus classicus case of Re Diplock’s Estate [1947] Ch 716
at pages 744-745, is that whenever there is or has been a fiduciary
relationship, the beneficial owner of an equitable interest in property may
trace it into the hands of anyone holding the property, except a bona fide
purchaser for value without notice whose title is, as usual, inviolable

28. RESULTING TRUSTS
•A resulting trust arises where in the absence of an express declaration, the
beneficial interest in the trust assets ‘jumps back’ to the person who provided
trust assets to the trustee, i.e. the settler. A resulting trust gives effect to the
implied intentions of the owner.
•A resulting trust may be automatic or presumed. It is automatic where the
dispositive provisions in an express trust fail. It is presumed where there is
insufficient evidence to determine the real terms of a transaction to which one
has contributed or made a transfer.

29. RESULTING TRUSTS
•A PRESUMED RESULTING TRUST
A resulting trust may arise when a person providing assets receives a benefit under a trust
because of an evidentiary presumption that the settlor intended the property to come back
to him. This trust arises when there is no evidence of the provider’s intentions when he or
she makes a gratuitous transfer or contributes to the purchase of property in another’s
name.
Example:
a) If A transfers an asset to B gratuitously (i.e. taking no payment of any kind in return, ‘for no consideration’),
and there is no reliable evidence of A’s true intentions, the court will find that B holds the asset in trust for A.

30. PRESUMED RESULTING TRUST
• In the case of In re Koranteng (dec’d), Addo v Koranteng and others [2007-2008]
SCGLR 1039 This was said;
• “In essence, a resulting trust was a legal presumption made by the law to the effect
that where a person had brought property in the name of another, that other person
would be deemed to hold the property in trust for the true purchaser. It was a trust
implied by equity in favour of the true purchaser or his estate upon death. The
trust was regarded as arising from the unexpressed or implied intention of the true
purchaser. Thus for a resulting trust to be established there had to be proof that the
purchase money for the disputed property had been advanced by the beneficiary of
the resulting trust.”

31. PRESUMPTION OF ADVANCEMENT
•Advancement
A presumed resulting trust may be rebutted by the counter presumption of
advancement.
•A presumption of advancement arises when a person providing purchase
money for an acquisition has an equitable obligation to support or make
provision for the person to whom the property is conveyed. This arises
between a husband and wife, father and child.

32. PRESUMPTION OF ADVANCEMENT
Husband and wife
The presumption of advancement is recognized where a husband transfers property to his wife or purchases
property in their joint names or in her name alone. Ramia v. Ramia [1981[GLR] 275.
Cohabitation
The presumption of advancement is not destroyed by the subsequent dissolution of the marriage. Diwell v.
Farnes [1959] 1 WLR 624.
Wife to Husband
The presumption of advancement does not arise when a wife buys property in the name of her husband. In
such a case he holds the property as a trustee for his wife. Heseltine v. Heseltine [1971]1 WLR 342; Quist v.
George [1974] GLR 1; Harrison v Gray Jnr [1979] GLR 330.

33. PRESUMPTION OF ADVANCEMENT
Father and child
The relationship between a father and his child gives rise to the presumption of
advancement.
Re Roberts Trust [1946] Ch.1.
In Re Sasu-Twum (decd.); Sasu-Twum v. Twum [1976] 1 GLR 23.
Mother and child
The presumption of advancement does not arise between mother and child unless the
mother stands in loco parentis. Bennet v. Bennet (1879) 10 Ch D474.

34. REBUTTING THE PRESUMPTION OF
ADVANCEMENT
The presumption of advancement may be rebutted by evidence that the person
paying the money did not intend to forgo the beneficial interest.
• Oppong v. Oppong [1992] 1 GLR 83;
• Ussher v. Darko [1977] 1GLR 476.
• Kwatreng v. Amassah [1962] 1 GLR 241.

35. RESULTING TRUST
• b) Where A provides the money for the purchase of property, but buys the
property in the name of A and B, it may be held that B holds the property in trust
for A, if there is no reliable evidence regarding A’s intentions. Reindorf v. Reindorf
[1974] 2 GLR 38.
• NB: Currently, marital property is understood to be “property acquired by the
spouses during the marriage, irrespective of whether the other spouse has made
a contribution to its acquisition.” Arthur v. Arthur, [2013-2014] 1 SCGLR 543.

36. RESULTING TRUST
• c) Where A and B contribute money or other value to purchase of an asset
in B’s name, if there is no reliable evidence as to A’s and B’s intentions, B will
hold the asset on trust for himself and A in shares proportionate to the amount
they contributed to the purchase price.
Quartey v. Armar [1971] 2 GLR 231.

37. RESULTING TRUSTS
Automatic
• A resulting trust may arise when a trust ‘fails’, in whole or in part, that
is, when any or all of the beneficial interests created under an express
trust fails. In such cases the undisposed interest(s) in the trust property
results to the settlor. An express trust, which fails for uncertainty of
objects.
• Cleaver v. Mutual Reserve Fund Life Association [1892] 1 QB 147.
• Sylvia Gregory v Nana Kwesi Tandoh IV and Brigget Hanson CIVIL APPEAL NO.HI/13/2004.

38. FORMALITIES FOR THE CREATION OF A TRUST
Capacity to create a trust
Capacity to hold an interest in property is governed by customary, statute and
common law. It seems that any person can create an interest in land in Ghana and also
make a trust of such property.
It seems that in Ghana an infant can create a trust. Under our laws such a disposition
is voidable and may be repudiated any time during his infancy or within a reasonable
time on the attainment or majority. See Edwards v Carter [1893] Ac 360. Such a
disposition may be set aside if it is prejudicial to the interest of the child.

39. FORMALITIES FOR THE CREATION OF A
TRUST
• Mental incapacity- such a person cannot create a trust because such a person
lacks dispositive intent. Any trust created by such a person is void. If the trust
was created during the time that such an insane settlor was in his lucid period
and he/she fully understands the nature of his act and the consequences of the
same, such trust may be upheld as valid. Re Beaney [1978] 1 W.L.R. 770.

40. THE ESSENTIAL REQUIREMENTS FOR THE CREATION OF AN EXPRESS
TRUST
These were laid down in the case of Knight v. Knight (1840) Beav 148 (49 ER
58) by Lord Langdale
1. There must be a clear intention to create a trust(certainty of Words)
2. The property to be held in trust must be certain. (Certainty of subject matter)
3. The persons or objects to benefit from the trust must also be certain.
(certainty of objects)

41. CERTAINTY OF WORDS/INTENTION
There should be a clear intention to create a trust. The words used by the testator or
the settler should demonstrate an unequivocal intention to create a trust in favour of
some intended beneficiaries or objects. The language used by the settlor must be
imperative, clear, and unambiguous. No particular form or technical words are
required.
In Jones v Lock [1865] 1 Ch App 25;
Knight v. Knight (1840) Beav 148 (49 ER58);
Lambe v. Eames (1871) 6 Ch. App 597;
Re Adams and the Kensington Vestry (1884) 27 Ch. D. 394.

42. CERTAINTY OF WORDS/INTENTION
Generally, an inference of a trust will not be made from precatory words. Lambe v.
Eames (1871) 6 Ch. App 597.
Gyasi v. Quaigraine [1963] 2 GLR 161.
Sey v. Sey [1963] 2 GLR 220.
The court will construe precatory words as creating a trust if an intention to do so
can be determine by construing/interpreting the trust documents as a whole.
Comiskey v. Bowring-Hanbury [1905] A.C. 84.

43. CERTAINTY OF SUBJECT MATTER
The subject matter must be clearly defined or described so that it is
capable of being identified. If the subject matter is not certain the gift is
void and no trust is created. The subject matter would remain part of
the assets or estate of the donor.
• In Re Last [1958] P 137.
• Sprange v. Barnard (29 E.R 320)
• Palmer v. Simmonds (61 ER 704):
• Boyce v Boyce (1849) 60 ER 959.

44. CERTAINTY OF SUBJECT MATTER
• In addition, even if the trust property is clearly defined, the share or shares in
that property to which the beneficiaries are entitled must also be clearly defined.
• Where there are two or more beneficiaries and their interests (proportion) are not
expressly indicated, this may be resolved by recourse to the maxim “equality is
equity.” In this case the beneficiaries will share the property equally.

45. CERTAINTY OF SUBJECT MATTER
• In a fixed trust the entitlements of the beneficiaries in the
property must be known. Apart from the physical subject
matter, the beneficial interest must also be known e.g. is it
a life interest?

46. Certainty of Beneficiaries
The beneficiaries of a trust must be clearly ascertainable. They must be sufficiently described
so as to be ascertainable.
This requirement of certainty is not so strict for a charitable trust since the courts will apply
the trust to the nearest object to that indicated by the testator.
Where the beneficiaries are not certain, there arises a resulting trust in favour of the settlor or
his estate.
Re Ball, Hand v. Hall [1947] Ch. 228
It has been held that the three certainties are interrelated and the absence of one may cast
doubt on the existence of the others. Mussoorie Bank v. Raynor (1882) 7 App Cas 321

47. Secret Trusts
•Secret Trusts
There are two types of secret trust: fully secret and half-secret trusts
Fully secret trusts- This is one in which the instrument or document
conveying the property does not disclose evidence of a trust, although the
property is conveyed or given on trust. The striking feature of such a trust
is that it looks like an absolute and beneficial gift to the transferee in
his/her own right, but the secret trustee or the “ostensible beneficiary”
would have agreed or promised to hold it in trust for the true beneficiary. A
fully secret trust is used to hide the true recipient of a testamentary
disposition.

48. Secret Trusts
There is a limit to the enforceability of secret trusts as to avoid the device of the secret trust being used to
make unattested testamentary dispositions.
In Blackwell v. Blackwell [1929] A.C. 318, at 339, Lord Summer stated: "It is communicated of the purpose to
the legatee, coupled with acquiescence or promise on his part”
In Ottaway v. Norman [1971] 3 All E.R. 1325/ (1972) Ch 698 Brightman J. stated the essential requirements
of a secret trust as follows:
1. Intention of the testator to subject the primary donee to an obligation in favour of the secondary donees;
2. Communication of that intention to the primary done;
3. Acceptance of that obligation by the primary donee either expressly or by acquiescence.

49. Secret Trusts
The communication between the donor and donee may be made before or after the
date of the will provided it is made during the life time of the donor.
Communication and acceptance may be determined constructively. Re Boyes [1884] 26
Ch D 531.
It is not sufficient if the donee is just told that he is to hold the property in trust. The
relevant details, about the trust must be communicated to him.
Re Colin Cooper (1939)3AER 586.

50. Secret Trusts
If the trust is accepted by the trustee/donee, but the objects are not
communicated during the testator’s lifetime, the trustee will hold the
property for a residuary legatee or devisee, or for the persons
entitled upon intestacy.

51. Secret Trusts
• Where property is transferred to 2 or more donees as joint tenants in a fully secret trust
and only one is informed about the trust and accepts to be a trustee, a trust will be
declared if the donee promised to accept the trust before the making of the gift.
• If the promise was made after the execution of the will or the document transferring
the property, only the donee who promised to accept the trust will be bound see Re
Stead [1900] 1 Ch 237- The other will be a beneficiary because his interest will not be
tainted with ‘fraud’ and this will bring the joint tenancy to an end.

52. Secret Trusts
• Where the donees are tenants in common only the one who accepts the
trust will be bound whether acceptance was before or after the execution
of the will. In other words, where property is transferred to trustees as
tenants in common, the secret trust will only bind those donees who
have received communication of, and accepted the trust obligation.
Tee v Ferris (1856) 2 K & J 357.
In Re Stead [1903] 1 IR 73.

53. Secret Trusts
Half Secret trust
• In a half secret trust, the will or the instrument conveying the property discloses
the general existence of a trust, but the terms of the trust do not fully or
sufficiently appear in a will or the trust instrument. It is said expressly that there
is to be a trust. E.g. to my trustees A and B for purposes which I have
communicated to them.

54. Secret Trusts
• As a safeguard by equity to prevent fraud, the particulars must be
communicated to the trustee and accepted by him before or at the time of the
execution of the will. Such a trust fails if the details are not communicated to
the trustee before the will is executed. Re Keen [1937] Ch 236.
• If a half-secret trust fails for lack of communication, the trustees hold the
property for those entitled to the residue or the intestate estate. The trustees
cannot hold beneficially because the will makes it clear that they are trustees.
Re Rees [1920] 2 Ch 59.