Posted: January 19th, 2016

Can they be forced not to attempt to enforce the covenant?

Constitution of Trusts

In *Milroy v Lord (1862) 4 De GF&J 264, 45 ER 1185 Turner LJ said, setting out the ways in which a settlor may provide (gratuitously; you can also sell people property!) for his intended beneficiary,
“He may, of course, do this by actually transferring the property to the persons for whom he intends to provide, and the provision will then be effectual and it will be equally effectual if he transfers the property to a trustee for the purposes of the settlement or declares that he himself holds it on trust for those purposes.”
The first of these three possibilities is gift. The second is a transfer to trustees on trust, and the third a self-declaration of trust. The rules on constitution of trusts therefore build on normal rules of transfer of legal title. If I want to give you a vase I hand it over. If I want to give you some shares I may have to fill in a share transfer form and register the transfer with the company. This is so in those cases we will look at and you need not worry about other methods of share transfer. If I want to transfer money in a bank account I ask that it be transferred through the banking system.

The Concept of Constitution