Equity and Trusts in Australia

456 Pages·2012·8.957 MB·English

by  Vicki Vann, Michael Bryan

EQUITY AND
TRUSTS IN
AUSTRALIA
EquityandTrustsinAustraliaisapracticalandengagingintroductiontoequitable
and trust law in Australia. Drawing on the authors’ collective 45 years of teaching
experience, this text is carefully designed to cater to the needs of undergraduate
lawandJurisDoctorstudentsapproachingthelawofequityandtrustsforthefirst
time.Thebookprovidesasuccinct,clearandaccessibleexplanationofkeytheories
and terminology in equity and trusts, and demonstrates how these are applied in
practicewithsimple,topicalexamples.Comprehensivelycross-referenced,itdraws
linksbetweenequitableandtrustdoctrinesandtheirwiderrelationshipstothelaw.
The companion website, at www.cambridge.edu.au/academic/equity, is an
invaluable resource for students and lecturers, featuring further reading, discus-
sion points, and practice exercises and solutions.
M.W.Bryan is Professor Emeritus at the University of Melbourne.
V.J.Vann is Lecturer at Monash University.
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EQUITY AND
TRUSTS IN
AUSTRALIA
M. W. Bryan
V. J. Vann
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NationalLibraryofAustraliaCataloguinginPublicationdata
Bryan,Michael,1949–
EquityandTrustsinAustralia/MichaelBryan,VickiVann.
9780521676632(pbk.)
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Equity–Australia.
Trustsandtrustees–Australia.
Vann,Vicki.
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CONTENTS
Preface xi
Tableofcases xii
Tableofstatutes xxix
Listofabbreviations xxxv
Part A Introduction
1 Anoverviewofequity 2
Whatisequity? 3
Amapofequity 13
Themaximsofequity 20
What’sonline? 21
Part B Equitable Remedies
2 Anintroductiontoequitableremedies 24
Introduction 25
Personalandproprietaryremedies 26
Theobjectivesofequitableremedies 28
What’sonline? 31
3 Specificperformance,injunctionsandequitabledamages 32
Introduction 33
Specificperformance 33
Injunctions 40
Plaintiff’sremedyifspecificperformanceorinjunctionaredenied 51
Equitabledamages 51
Areequitabledamagesavailableforequitablewrongs? 52
Howareequitabledamagesassessed? 54
What’sonline? 55
4 Monetaryremediesinequity 56
Accountsofprofits 57
Howareaccountsofprofitscalculated? 58
Equitablecompensation 61
Howisequitablecompensationcalculated? 63
What’sonline? 70
v
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vi Contents
5 Rescission,rectificationanddeclarations 71
Introduction 72
Whencanavoidabletransactionberescinded? 72
Theaimofrescission 73
Rescissionatcommonlawandinequity 73
Totalandpartialrescission 74
Theelectiontorescind 75
Restoringthepartiestotheirpre-contractualposition 76
Theproprietaryconsequencesofrescission 77
Barstorescissionandpecuniaryrestitution 78
Rectification 79
Declaration 81
What’sonline? 83
6 Barstorelief 84
Introduction 85
Laches 85
Acquiescence 87
Uncleanhands 88
Hardship 91
Effectoforderonthirdparties 92
What’sonline? 93
Part C Equity, Contract and Property
7 Equityincontractlaw 96
Introduction 97
Estoppelandpromiseenforcement 97
Equityandvoidabletransactions 103
Undueinfluence 105
Unconscientiousconduct 110
TheruleinYerkeyvJonesandtheGarciacase 113
Equityandsubstantivefairness:penaltiesandrelieffromforfeiture 116
What’sonline? 121
8 Equitableproprietaryinterests 122
Introduction 123
Thenatureofequitableownership 125
Prioritydisputesandthedoctrineofnotice 126
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Contents vii
Equitiesandequitableinterests 127
What’sonline? 129
9 Equitableassignments 130
Introduction 131
Assignmentoflegalproperty 132
Assignmentofequitableproperty 141
Statutoryassignment 143
What’sonline? 149
Part D Equitable Obligations
10 Fiduciaryobligations 152
Introduction 153
Fiduciaryrelationships 154
Fiduciaryobligations 162
What’sonline? 172
11 Participantsinabreachoffiduciaryobligation 173
Introduction 174
Thirdpartyliability:theruleinBarnesvAddy 176
Otherformsofparticipatoryliability 187
What’sonline? 188
12 Breachofconfidence 189
Introduction 190
Theequitableobligationofconfidence 190
Defencestobreachofconfidence 197
Protectionofprivateinformation 199
Remediesforbreachofconfidence 202
What’sonline? 205
Part E Express Trusts
13 Theconceptoftheexpresstrust 208
Introduction 209
Definition 209
Trustsandrelatedconcepts 218
What’sonline? 224
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viii Contents
14 Certaintyrequirementsinthelawoftrusts 225
Introduction 226
Certaintyofintention 227
Certaintyofsubject-matter 235
Certaintyofobjects 237
What’sonline? 245
15 Creatinganexpresstrust 246
Introduction 247
Methodsofcreatingatrust 247
Testamentarytrusts 251
Thedoctrineofincorporationbyreference 252
Incompletelyconstitutedtrusts 252
Trustsandpublicpolicy 253
What’sonline? 255
16 Trustsforcharitableandnon-charitablepurposes 256
Introduction 257
Avalidtrustforapurpose 257
Historicaldevelopmentofthecharitabletrust 258
Trustsfortheaged,impotentandpoor 259
Trustsfortheadvancementofeducation 261
Trustsfortheadvancementofreligion 262
Trustsforotherpurposesbeneficialtothecommunity 263
The‘publicbenefit’ 267
Trustsformultiplepurposes 269
Administrativeschemes 270
Trustsfornon-charitablepurposes 272
Problemswithpurposetrusts 272
What’sonline? 275
Part F Performing the Trust
17 Trustees’dutiesandpowers 278
Introduction 279
Sourcesofthetrustee’sdutiesandpowers 279
Dutiesonassumptionoftrusteeship 280
Ongoingmanagementduties 282
Dutiesofperformance 287
Trustees’powers 296
Exerciseofpowerandreview 296
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Contents ix
Effectofimproperexerciseofdiscretion 302
What’sonline? 303
18 Investmentoftrustfunds 304
Introduction 305
Sourcesoftrustees’investmentpowers 305
Thestatutorymodel 307
Investingprudently 309
Reviewofinvestments 311
Applyingotherdutiesoflawandequitytoinvesting 312
Matterstobeconsideredbythetrusteewheninvesting 317
Exculpatoryprovisions 319
What’sonline? 321
19 Trustees’rightsandliabilities 322
Introduction 323
Trustees’liabilities 323
Trustee’srightofindemnity 323
Thestatusofthetrustee’srightofindemnity 324
Indemnificationbythebeneficiaries 331
Trustee’srighttoimpoundbeneficiary’sinterest 334
Trustee’srightofcontributionfromco-trustees 334
Trustee’srighttorecoveroverpaymentfromabeneficiary 335
What’sonline? 336
Part G Breach of Trust
20 Breachoftrust:Defencesandremedies 338
Introduction 339
Exculpationanddefences 339
Exculpationinthetrustinstrument 339
Statutoryexculpation 343
Equitabledefences 346
Remediesinthecontextofbreachoftrust 348
Monetaryremediesforbreachoftrust 349
Non-monetaryremediesforbreachoftrust 353
Standingtosue 355
What’sonline? 355
21 Tracing 356
Introduction 357
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x Contents
Tracingandclaimingatcommonlawandinequity 358
Afiduciaryrequirement? 359
Theequitabletracingrules 360
Defencestoequitabletracingclaims 368
What’sonline? 369
Part H Non-consensual Trusts
22 Resultingtrusts 372
Introduction 373
Whydoesequityrecogniseresultingtrusts? 374
Thepresumptionofadvancement 376
Applicationofthepresumptionstofamilyproperty 379
Voluntarytransfersofproperty 384
Resultingtrustsarisingonfailureofanexpresstrust 384
Resultingtrustsarisinginothercasesoffailureofbasis:theQuistclosetrust 386
What’sonline? 388
23 Constructivetrusts 389
Introduction 390
Theconstructivetrustcomparedwithothertrusts 390
Categoriesandprinciples 391
The‘commonintention’constructivetrustandfamilypropertydisputes 393
TheBaumgartnerconstructivetrust 395
Theconstructivetrustasaremedyforestoppel 402
Constructivetrustsimposedforbreachoffiduciaryobligation 403
Theconstructivetrustimposedoverstolenmoneyanditsproceeds 406
Theconstructivetrustasarestitutionaryremedyforunjustenrichment 407
Thedoctrineofmutualwills 409
Constructivetrustsimposedoverpropertytransferredunderspecifically
enforceablecontracts 411
What’sonline? 413
Index 414
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