The general principle is that a trust to be fully enforceable the settlor must have the capacity to create a trust, the three certainties must be satisfied, and the current formalities must be followed and the property must vest to the trustees. To work on experience placement in the legal department of a City firm, “Rigby, Jolly and Pinnar”- a group of independent financial advisors, it is necessary to have a clear knowledge about three certainties of trust, formalities of trust, constitution of trust as well as fixed trust, and discretionary trust.Before advising, it is necessary to consider the trustees powers and duties. He has to concern about the ‘dispositive’, administrative, ‘fiduciary’, powers, and duties.

However, a trust may fail for uncertain beneficiaries. Therefore, the trustees need to be able to identify who the beneficiaries should be, certainty of objects. In Knight v Knight Lord Langdale, 123a private express trust cannot be created unless three certainties are present, these are certainty of intention, certainty of subject matter and certainty of beneficiaries.Settlors specify the number of beneficiaries to create fixed trust, for example a trust in favour of ‘my children’. In Hunter v Moss2, the CA held that a declaration of trust of 50 shares from a holding of 950 did not fail for uncertainty of subject matter.

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The ‘beneficiary Principle’ states that a valid trust must be for the benefit of ascertainable individuals- the trust must have beneficiaries. The first objection may be seen in a celebrated dictum of Sir William Grant M. R. in Morice v Bishop of Durham3. Every trust has an obligation.

Sir William Grant M. R. states: There can be no trust, over the exercise of which this Court will not assume a control; for an uncontrollable power of disposition would be ownership, and not trust..

. Every trust (other than a charitable one) must have a definite object. There must be somebody, in whose favour the court can decree performance. ’ This rule similar to ‘privity’ rule of contract law; only parties of the contract may enforce it; even though some third party may benefit from the performance of a contract, that factual benefit alone gives him no interest under the contract, and thus no right to enforce it.When settlors create discretionary trust, the trustees are required to exercise their discretion to select the beneficiaries from among a class of objects and/or determine the quantum of interest that the beneficiaries may enjoy.

The modern test for certainty of objects in respect of discretionary trusts is known as the ‘individual ascertain ability’ test, or the ‘is or is not’ test, or the ‘any given postulant’ test. This test was laid down by the House of Lords in McPhail v Doulton (sub nom Re Baden) and Re Gulbenkian4 .The test is very appropriate for fixed trusts, but creates unfair and unjust results for discretionary trusts. Although the trustee would be able to make a reasonable selection, the ‘complete list’ test would invalid the trust. Lord Wilberforce recognised this as unsatisfactory while giving judgment in McPhail v Doulton5: ‘The basis for the Broadway Cottages principle is stated that to be that a trust cannot be valid unless, if need be, it can be executed by the court and .

.. the court can only execute it by ordering an equal distribution in which every beneficiary shares. A new test has been adopted for power and discretionary trusts. This test means that ‘the power will be valid if it can be said with certainty whether any given individual is or is not a member of the class and the power does not simply fail because it is impossible to ascertain every member of the class according to in McPhail v Doulton. In Re Astor’s Settlement Trust6, Lord Astor purported to create a trust for ‘the maintenance of good understanding between nations and preservation of the independence and integrity of newspapers.

The court held that trust was void for uncertainty on the ground that means by which the trustees were to attain the stated aims were unspecified and the person who was entitled, as of right, to enforce trust was unnamed. The main question is whether the court can execute the trust upon the failure of the trustees to do so. In Re Baden’s Deed Trusts7 (No. 2), Brightman J. , and the CA, had to apply the test laid down by the HL, and consider in particular whether the words “dependants” and “relatives” were too uncertain. In applying the test is concerned with the former; “the court never defeated by evidential uncertainty.

The illustration given of a conceptual question is that of the contrasting cases ‘someone under a need moral obligation’. The terms ‘friends’, and ‘For the benefit of all assiduous lawyers working within the European Union’ are conceptually or sufficiently certain. The term ‘to my executors, the whole of my art collection to hold on trust for all or any of the good looking girls I dated in my youth’ is the term of conceptually uncertain. However, different minds may take different views on the question of whether a particular description is conceptually certain or not.In Re Barlow’s Will Trusts8, the 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 for uncertainty and guidance as to the appropriate method for identifying members of the testatrix’s family. The Court held that the direction as to ‘friends’ was valid, for the properties were to be distributed in specie and quantum of the gifts did not very with the class.

Despite the expression ‘friends’ being conceptually uncertain, the transfer by will amount to a series of individual gifts to persons who satisfied a specific description. The court also gave a guideline on the identification of friend’s family. These are as follows: a) The relationship with the testatrix was required to be a long standing, b) The relationship must have been social as opposed to business or professional’, c) When circumstances permitted, they met frequently. The expression ‘family’ meant a blood relationship with the testatrix.A “friend” was a person who had a relationship of long standing with the testatrix, which was a social as opposed to a business or professional relationship, and who had met her frequently when circumstance permitted. However, the claimant must prove “by any reasonable test” that he qualified.

This principle was applied in Re Baden’s Deed Trust (No. 2). The justification for this less strict test was that in the case of individual gifts, unlike trust and powers, uncertainty as to some beneficiaries did not affect the quantum of the gift in respect of those who clearly qualified.This test is known as “any postulant test”. The term ‘to my executors, the whole of my art collection to hold on trust for all or any of the good looking girls I dated in my youth’ is the term of conceptually uncertain. Therefore, theoretically this Trust will be void but if Court applies the decision of Re Barlow’s Will Trusts, the trust will be valid. In Re Tucks Settlement Trust9, the courts develop two further approaches that have a bearing on the “any given postulant” test. Here it can assume that for all or any of the good-looking girls, I dated in my youth indicates the ‘old friends’ class.

In this way the class of the objects would otherwise have failed or rescued by the settlor provided that the description offered by the settlor is clear enough for the courts to supervise. A variation in this theme entitles the settlor to appoint a third person as sole arbiter of the definition of the class of objects and perhaps all issues incidental to the exercise or non-exercise of the discretion. However, to impose this trust, it is necessary to interpret the meaning of the good -looking girls. The relationship between testator and the trustee is very important.For the benefit of all assiduous lawyers working within the European Union’ are conceptually or sufficiently certain and it is possible to make a complete list of lawyers.

However, the list will be too large, so it is possible to fail the trust. In R V District Auditor Ex P. West Yorkshire Metropolitan County Council10, where a local authority, purporting to act under statutory powers, resolved to set up a trust ‘for the benefit of any or all or some of the inhabitants of the county of West Yorkshire’.The court was prepared to assume that ‘inhabitant’ was sufficiently certain, but held the trust void for administrative unworkability as a class was far too large.

On the other hand, if the court applies Re Denley’s Settlement Trusts11, the trust will be valid. , Goff J upheld a trust under which a piece of land was to be used as a recreation ground for the employees of a particular company. He regarded the employees as persons so directly benefited by the purpose that (1) the purpose was not such an abstract kind so to fall foul of the beneficiary principle, and (2) that the employees had to standing enforce the purpose against the trustees.Subsequent commentary on the case has tended to treat the case as merely one of a particular kind of discretionary trust according to Re Grant’s Will Trusts12, or as a trust for persons with the purpose being treated merely as a “superadded” direction or motive for the gift Re Lipinski’s Will Trusts 13. Thus, the case appears to have been read to deny that it represents a true departure from the beneficiary principle.In Re Lipinski’s Will Trusts however; Oliver j followed the principle of Re Denley’s Trust Deed by finding that although a trust for the erection of buildings of the hull Judeans (Maccabi) Association was expressed as a purpose trust. It was in fact for the benefit of ascertainable individuals, namely, the members of the club, and he therefore held the trust to be valid. It was argued that because the testator had made the gift in memory of his late wife, this tented to perpetuity and precluded the association members for the time being from enjoying the gift beneficially.

Oliver J rejected this argument.Applying the principle of Re Lipinski’s Will Trusts to this disposition therefore, it might well not fail for certainty of objects. In case of Re Hay’s Settlement Trusts14the trust may be valid although the identify of all the objects is not known. In the case of wide-ranging discretionary trust and the trustee has applied his mind to the ‘size of the problem’ should he then consider in individual cases whether, in relation to other possible claimants, a particular grant is appropriate. In IRC v Broadway Cottages Trust15, it was held that for a trust to be valid the trustees must be able to draw up complete list of the beneficiaries.They had to overcome any conceptual or evidential uncertainties that might arise and locate all the beneficiaries, since otherwise the trust fund could not be properly distributed. In Re Endacott16, a testator transferred his residuary estate to the Devon Parish Council ‘for the purposes of providing some useful memorial to myself’.

The trust was failed for uncertainty of objects. In case of Blathwayt v Baron Cawley17, per Lord Wilberforce states “judge the degree of certainty with some measure of common sense and knowledge and without excessive astuteness to discover ambiguities. Lord Cross said, “while it may be wrong for the government to on religion, it does not follow against the public policy.

” From the above discussion, it can be said that recognition afforded only to trusts with objects able to enforce them is open criticism on the grounds of harshness and inflexibility and creates difficulties with endowments for unincorporated association. Trust will be fail for uncertainty objects but its judge discretion 18.