Express Trusts: The Three Certainties — Answers
FAQ answers
FAQ 1. Must a settlor use the word “trust”?
Answer. No. Intention is determined objectively from words and conduct. Paul v Constance and Re Armstrong are useful illustrations.
FAQ 2. Can equity simply treat a failed gift as a trust?
Answer. Not without sufficient intention to declare a trust. The court does not rescue every imperfect gift by changing its legal character.
FAQ 3. What happens if one of the three certainties fails?
Answer. The intended express trust may fail, with consequences depending on the failed element, transfer structure and any resulting trust or other doctrine.
FAQ 4. Which Queensland Trusts Act is current in October 2026?
Answer. The Trusts Act 2025 (Qld). The Trusts Act 1973 (Qld) was repealed on 28 April 2026, although it remains relevant historically and appears on the course resource list supplied by the user.
MCQ answers and explanations
MCQ 1. Paul v Constance is authority that:
Answer: B. The court looked at substance and context.
MCQ 2. Before applying certainty of objects, a student should identify:
Answer: B. Different trust types use different objects tests.
MCQ 3. In Queensland, the current principal trusts statute is:
Answer: B. The 2025 Act commenced on 28 April 2026.
MCQ 4. Re Armstrong is useful principally on:
Answer: A. It is a classic Australian authority on informal trust intention.
Short-answer model answers
Short answer 1. State the three certainties.
Model answer. Certainty of intention, certainty of subject matter and certainty of objects.
Short answer 2. Why is Paul v Constance a useful exam authority?
Model answer. It demonstrates that the court looks to objective substance and context rather than requiring formal trust terminology.
Short answer 3. How should the book treat the Trusts Act 1973 (Qld) in 2026?
Model answer. Keep it as a course-listed historical source, but identify that it was repealed on 28 April 2026 and use the Trusts Act 2025 (Qld) for current law.
High-distinction IRAC model answer
Issue. Whether George objectively manifested an immediate declaration of trust over the deposit capital for the children, or merely expressed a future intention to make a gift.
Law. An express trust requires certainty of intention, subject matter and objects. No technical words are required. Re Armstrong [1960] VR 202 is closely analogous: the court treated deposit arrangements and surrounding statements as sufficient to constitute a trust even though formal terminology was absent. Paul v Constance similarly confirms that ordinary words and conduct may demonstrate present trust intention. Byrnes v Kendle reinforces the objective approach.
Application. The $200,000 term deposit is identifiable subject matter. The two children are certain objects. The critical issue is intention. George retained the interest but expressly directed the capital benefit to the children and arranged receipts referring to them. That division between present income enjoyment and future capital entitlement is consistent with George constituting himself trustee of the capital subject to a life interest in income. The executor will stress the future language “when the deposit matures or when I die”, arguing that beneficial entitlement was postponed and no present trust was intended. The children should respond that postponement of enjoyment does not necessarily mean postponement of beneficial ownership: the trust can exist now even though payment is deferred.
Counterargument. If the evidence showed only a revocable plan or a future gift with no present obligation, the trust would fail. The bank manager’s evidence, account labels and segregation of the deposit therefore matter greatly.
Conclusion. On facts closely resembling Re Armstrong, the children have a strong argument that George objectively declared a present trust of the capital, retaining the income for life. The executor’s “future gift only” argument is plausible but weakened by the structured deposit arrangement and identified beneficiaries.