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Abstract
This thesis examines a phenomenon according to which a beneficiary of an express trust has a proprietary claim against a third party that facilitates the recovery of trust property or its traceable substitute (referred to as the beneficiary’s proprietary claim or ‘the claim’). As this thesis will show, relevant case law and academic scholarship have failed to understand the phenomenon as it is evidenced in the cases.
This thesis contributes to our understanding of a fundamental aspect of the express trust by developing a new account of the beneficiary’s proprietary claim that is derived from its operation and effect, as evidenced in the cases. The core argument of this thesis is that the beneficiary’s proprietary claim is part of a novel phenomenon according to which equity implements an institutional commitment to the express trust by providing an assurance that power will not be exercised in a manner that undermines the essential feature of an express trust. That feature is that the trustee holds and exercises her powers over trust property in accordance with the trust terms. When a power over trust property is exercised in a way that undermines this feature, the claim recognises an equity for relief necessary so that it is as if the exercise of power had not occurred. In this way, the claim assures against the problem that power can be exercised in a manner that undermines the essential feature of an express trust.
The thesis explores various justifications for the beneficiary’s proprietary claim and argues that the institutional vulnerability of the express trust justifies the assurance provided by the claim, the strict liability it imposes upon a recipient, and its priority and extension to traceable substitutes. The broader significance of this thesis is that it demonstrates the existence of equitable controls on power that ensure that the express trust functions consistently with equity’s choice to recognise the express trust. The law is as stated at 1 August 2019.