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

Determine the yield to maturity of the bond, The current market price of a ...

The current market price of a Leigh bond is $1,297.6. If the coupon rate is 10% and the par value is equal to $1,000, what is the yield to maturity of the bond if it matures in 10

What is capitalized interest, Q. What is Capitalized Interest? Capitali...

Q. What is Capitalized Interest? Capitalized Interest - INTEREST cost incurred during time required to bring an ASSET tothe condition and location for its intended use and incl

Provide doubtful debt , provide 5% for doubtful debt what is the journal en...

provide 5% for doubtful debt what is the journal entry

Case Study, I have a case study due in one of my classes. There are 3 pages...

I have a case study due in one of my classes. There are 3 pages of information about the company in the case, and there are 12 questions I must complete. Each question is basically

Limitations of financial accounting, LIMITATIONS O F FINANCIAL ACCOUNT...

LIMITATIONS O F FINANCIAL ACCOUNTING 1. Simply transactions which can be calculated in terms of money can be recorded in the books of accounts. Actions, though important t

What do you mean by depreciation, Q. What do you mean by depreciation? What...

Q. What do you mean by depreciation? What are the causes for depreciation? Explain the two methods of depreciation. Depreciation means a fall in the quality, quantity or value o

Calculate the expected return, A portfolio consists of the following three ...

A portfolio consists of the following three assets A, B and C. (a) Assuming a risk-free rate of 5.85 per cent and an expected return on the market of 13.60 per cent, calculate t

International accounting standards committee, International Accounting Stan...

International Accounting Standards Committee, the (IASC) - is an independent private sector body, formed in 1973, with objective of harmonizing the accounting principles that are u

Corporate finance, Calculate the market value of Renowned Cola''s debt at y...

Calculate the market value of Renowned Cola''s debt at year-end 2005. What is the book value of debt? Why do usually use market or book values for debt? Explain.

Estimate parametric market var, You have an investment in a portfolio with ...

You have an investment in a portfolio with a counterparty whose current credit rating is Baa. The current market value of the portfolio is $50,000,000 and its annual volatility is

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