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 current stock price & current dividend of company, 1. Select a pu...

1. Select a publicly traded company (preferably manufacturing oriented; do not use a financial services company such as a bank or a bank holding company) and obtain a copy of their

Responding to various stakeholder groups, Q. Responding to various stakehol...

Q. Responding to various stakeholder groups? If a company has a solitary objective in terms of maximising profitability then it is only responding to one stakeholder group name

Joint Audit, Impact of joint Audit on financial reporting quality

Impact of joint Audit on financial reporting quality

Proof of debts-bankruptcy and liquidation, PROOF OF DEBTS The following...

PROOF OF DEBTS The following rules apply as to the proving of debts: 1) A creditor has no right to vote or receive dividends until his debt is proved to the satisfaction of th

Inter company balances-group accounts, Inter Company balances One of th...

Inter Company balances One of the companies may appear as receivable (debtor) or payable (creditor) in the other company’s books. Just like in accounting four branches, such in

Identify total proceeds from new securitizations, Refer to Note 8, Securiti...

Refer to Note 8, Securitization Transactions (pp. 78-80) and an extract from Note 2, Additional Balance Sheet and Cash Flow Information (p. 72-73) from the Consolidated Financial S

Auditing., assess the risk of material misstatement at assertion level

assess the risk of material misstatement at assertion level

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