Constructive trusts-trusts laws and accounts, Financial Accounting

Assignment Help:

CONSTRUCTIVE TRUSTS

A constructive trust is a trust imposed by equity regardless of the intention of the owner of the property: it arises by operation of law.  The concept has been applied in a number of situations:
 
1. It is a rule of equity that a trustee must not permit his interests to conflict with his duties: note particularly, a trustee may not profit from his trust:  where he does so he holds the gains on a constructive trust (Keech v Sandford);

2. If a person who is not a trustee obtains information with the help of a trustee which enables him to make a profit, he holds the proceeds on constructive trust: (Boardman v Phipps);

3. If a person receives trust property with knowledge (actual or constructive) that it is trust property, and it is transferred to him in breach of trust, he holds the property as trustee;

4. A person who does not actually receive trust property but assists a trustee to fraudulently dispose of it is liable as a trustee.
 
Note:
Strangers are not to be made constructive trustees merely because they act as the agents of trustees in transactions within their legal powers, e.g a solicitor who creates a fraudulent document on the instructions of the trustee. They will be liable only if:-

  • They receive the trust property; or
  • Act in a manner consistent with that of a trustee; or
  • Assist with knowledge in a dishonest and fraudulent design on the part of the trustees.

Related Discussions:- Constructive trusts-trusts laws and accounts

What is permanent negotiating machinery, Q. What is Permanent Negotiating M...

Q. What is Permanent Negotiating Machinery? Two Federation of Union All Indian Railway men's federation (AIRF) & National Federation of Indian Railway (NFIR) men have been reco

Ias 1, Dillings Ltd is a wholesaler and distributor of catering of office e...

Dillings Ltd is a wholesaler and distributor of catering of office equipment. The following list of balances was extracted from its books at 31 March 2004: 1428_Prepare the Income

Draw x-bar process control chart and calculate probability , Kevin Murtuag...

Kevin Murtuagh, manager of an national reservation service for a nationwide chain of luxury hotels, is concerned about productivity of his operation.  Analysis of recent historical

Break-even point, am trying to figure out the break-even point in units usi...

am trying to figure out the break-even point in units using the mathmatical equation. the numbers i have are unit selling price $520, the variable costs per unit are $312 and fina

Liquidity ratios, Liquidity Ratios - These ratios include the Current Rat...

Liquidity Ratios - These ratios include the Current Ratio and the Quick Ratio or the acid test ratio. Liquidity ratios show the Liquid position of a company in the short term i.e

Trend analysis in detail with example, Trend Analysis Tre...

Trend Analysis Trend analysis is an improvement over year-to-year analysis. When a comparison of financial statements covering more than three years i

Bond yield, If I bought a 10 year bond five years ago for 936.05. The bons ...

If I bought a 10 year bond five years ago for 936.05. The bons make semiannual coupon payments at a rate of 8.4%. If the current price of the bonds is 1,048.77, what is the yield e

business strategy-vertical horizontal or conglomerate , What was the busin...

What was the business strategy underlying the merger? How was the acquisition financed? Was it a vertical, horizontal or conglomerate merger?   The strategy behind those merge

Help, I need help with my homework

I need help with my homework

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd