The of Equity and Trusts - Case Study Example

Equity and trusts Affiliation Equity and trusts The issue in this case study is that a gift was left to Darshan where Sanjeev had promised him that the farm on Isle of Wright would be his. According to him, this promise was binding because all his lifetime he has spent on the farm. However, the will indicated something different because Sanjeev’s Daughter Ishani was supposed to receive the farm and all its contents. When something is promised to the individual, it is a gift because the recipient does not have to give any remuneration to the donor1. The will indicated that Ishani would get the farm and all its contents, but Darmal was only promised the farm. This means that because it was a future consideration then the gift was not valid and he had no valid claim over the land. A gift in the law of trust is defined as an intentional transfer of possessions or interest in that property from one person to another, the gift is made wantonly to the recipient. In case a gratuitous transferal of property is to be operational at some impending date then it constitutes just a sheer promise to create a gift of property that is unenforceable because of lack of consideration. However, a present gift that is of future interest is valid. Additionally, in order for a gift to be valid three rules must be followed to establish whether the gift was actually made to the donee2. They include delivery where the promised gift or property must be delivered straight to the donee or in some case to a 3rd party on behalf of the donee. In the case where the third party is the Bailee, donor’s agent or trustee then the delivery is only complete when that person hands in the property to the donee. Thus, delivery must be implied, actual or symbolic if some affirmative action takes place. This means that delivery can only occur in instances when the donor submits control over the property. Additionally, proof that the donor has renounced all claim to the gift and acknowledges the donee’s right to apply control over the property is adequate to show that the gift was made. Secondly, there must be donative intent where the donor must show the intention to make a gift, which is mostly unwavering by the benefactor’s words. However, the courts must also determine the surrounding circumstances, the magnitude of the gift in relation to the extent of the donor’s possessions as a whole, relationship between the parties and the comportment of the donor towards the property following to the purported gift. Furthermore, the donor or the individual making the gift must have the capability to make a gift. In that, person’s with who are judged to have a legal incapacity to attend his or her own legal affairs and infants are said to have a legal infirmity to make a gift3. Moreover, the intent to make the gift must really exist. In the case of Darmal, there was no existence of intention to make a gift. This is because the promise was unenforceable since there was no intent to make an actual gift at the time the undertaking was made. In that, the mere expectation that a property will someday be given to an individual does not make it legally suitable to make a gift. Lastly, there is acceptance of the gift that has been bequeathed to the donee. Therefore, the donee must unconditionally accept to take the gift and acceptance can be made the same time delivery is made. In the case of Darmshal, although he may claim that the gift was inter vivos the three conditions were not fulfilled because the gift could not go back to him after the demise of the donor4. This is because although the deceased had indicated that he would give property to Darmshal there was no delivery of the gift, which is the first condition. Secondly, he only indicated that it would happen in the future, but he did not make an effort to transfer the property. Lastly, although the donee had accepted to take the property in case it was given to them there was no actual acceptance. In conclusion, a valid will was had been written indicating where the property would go, but it did not indicate that the property belonged to Darmshal. A will is a legal document that is written in order to determine the manner in which the testator’s property will be divided where he or she dies. According to the Wills and Successions, all wills must be in writing and they must follow the required rules of writing a will. Therefore, in the case of Darmshal he does not have any claim to invalidate the will that was written by the deceased. This also means that the Darmshal does not have any valid right over the property as it belongs to Ishani. In the case of Jameel, the deceased indicated that in the instance of his death he would take the shares in Harcombe plc. This gift was given in contemplation of death because Sanjeev had indicated, “if I don’t make it, I want you to have my shares in Harcombe plc. However, in the case of Amal the will had indicated that the shares belonged to them and before Sanjeev became ill, he had completed the appropriate share transfer form that was only awaiting approval from the board of directors5. Therefore, Amal was the rightful owner of the shares because Sanjeev had fulfilled the three rules of gift giving where there is transfer, donative intention and acceptance. Causa Mortis Gifts or a gift given in contemplation of death is a gift that is given by an individual who anticipates imminent death. This form of gift takes effect or place upon the demise of the benefactor from the probable illness or disease. This was stated in the case of Re Bayoff Estate6 where the donor suffer from cancer and the only way the bank could allow a person who had been gifted his account was his demise. However, in case the donor discovers from the danger they are in the gift is inevitably revoked. Therefore, the possibility of death or certainty of death must be proven in order for the gift causa mortis to be valid. This was established in the case of Northcott V Public trustee7, where it was suggested that the gift requisites be made in both the possibility of recovery and contemplation of death. This is to mean that the requirement is not to show that the deceased held that death was certain. Additionally, gift causa mortis merely relates to personal property. In the case of Sebrot Farms Ltd V Bradford Co-operative Storage Ltd,8Justice Epstein defined personal property as divisible into corporal personal property including tangible and movable things and incorporeal personal property which includes rights as personal annuities, shares, stocks , copyrights and patents. Therefore, in this case the gift being shares was a personal property. The donor approaching death might make the gift into writing indicating his or her intention. The delivery of the gift is relaxed because the donor may make actual delivery after death. However, a symbolic delivery must be made to establish that some effort was actually made. The prerequisites of causa mortis gift are the same as those of gift inter vivos. Moreover, gift causa mortis must be made with the view towards the bereavement of the donor, where the benefactor must die of an ailment, as well as, delivery of the gift. In the case of Jameel and Amal, there is an issue of Causa mortis gift and testamentary gift. Where a testamentary gift is made by will, which assigns ownership ensuing the death of the donor. Causa mortis, on the other hand, takes effect immediate after the bereavement of the donor9. However, in this case, the transfer of the shares had already been made in the name of Amal and the shares were only awaiting the approval of the board of directors. In this case, the courts may find it difficult to actually prove who has the right over the shares. This is because the shares immediately went to Jameel under Causa Mortis when Sanjeev died. The case study shows that Amal has a valid right under the testamentary will; however, when Sanjeev stated that the shares would move to Jameel upon his death then it means that they were valid under gifts causa mortis10. In that, the board of directors were yet to approve the transfer of the shares meaning that they had not yet moved to Amal as written under the will. Sanjeev contemplated death after suffering from Ebola meaning that there was a possibility of death and contemplation of death when he decided to bestow the shares upon Jameel. Therefore, after the death the shares automatically moved to the donee, as the donor did not recover from the disease, which would have revoked the making of the gift. Additionally, the statement was made when the donee was there with the donor meaning that there was intention of leaving the shares to him. In case of delivery, it not an important prerequisite as it is relaxed in most cases because in some instance after the demise of the donor the magnitude of the gift may be big to be carried by the donee11. Therefore, in this case Jameel accepted the shares meaning that the gift causa mortis was valid. In conclusion, gift in contemplation of death does not require a lot of seriousness as that accorded to testamentary will and gift inter vivos. This is because a donor gives the gift while they see that there is certainty or possibility of death due to certain illness or disease. Additionally, this type of gift has an exception where the donor in case they survive the disease can revoke the gift. Therefore, in the case of Jameel the claim is valid because the donor gave the gift a personal property to him during a contemplation of death. Furthermore, the board of directors had not approved the transfer of shares to Amal meaning that the shares did not belong to him. References Emerson, R. W. (2009). Business law. Hauppauge, N.Y: Barrons Educational Series. McDonald, I., & Street, A. (2013). Equity & trusts: Law revision and study guide. Oxford: Oxford University Press. Northcott V Public trustee (1903-1923) XXXI NZLR 1242. Pettit, P. H. (2012). Equity and the law of trusts. Oxford, U.K: Oxford University Press. Re Bayoff Estate 2000 SKQB 23. Rosenstock, J. (2005). Transferring invention rights: Effective and enforceable contracts. New York: Aspen Publishers. Sebrot Farms Ltd V Bradford Co-operative Storage Ltd (145 DLR 331,1997). Watt, G. (2012). Equity and trusts law directions. Oxford: Oxford University Press. Read More