Law Notes II: EQUITY & THE LAW OF TRUST COURSE OUTLINE

COURSE BREAKDOWN

A. GENERAL INTRODUCTION TO THE COURSE

1. Course description

Equity and trusts is a unique branch of English law based on a body of principles made by the Courts of Chancery, that focusses on bringing balance to the legal system, particularly the Common Law. The law of trusts was constructed as an adjunct to the law of property, to tend to situations in which one person holds legal title to a property, but the courts decided it is fair, just or "equitable" that another person should benefit from the property.

2. Content

With regards to equity, this unit will therefore focus on meaning, nature and origin of equity and its application within the East African context; maxims of equity; and equitable remedies (Injunctions, specific performance, accounts, declarations, receivership, repudiation and restitution).

The Law of Trusts part will focus on; definition of a trust, origin of trusts, terms associated with trusts, relevant principles of trusts law, common uses of trusts; nature of trusts; comparison of trusts and other relationships; classifications of trusts; creation of trusts (trust created by the act of other parties, trusts created by operation of the law, express private trusts, secret trusts); the three certainties; constructive trusts; charitable trusts; trustees (capacity, number, appointment of trustees, powers and duties of trustees, vesting of trust property, retirement of trustees and removal of trustees); trust accounts

3. Mode of instruction

The course will be presented to students in the following format: -

i. Lectures

ii. Tutorials

iii. Group discussions and presentations

iv. Individual presentations

v. Case studies

vi. Problem based learning and mooting.

4. Expected learning outcomes

At the conclusion of the course, the students are expected to be able to:-

Trace the historical development from common law to application of equity in Kenya and

East Africa.

Demonstrate a trust, the concept of trusteeship and the nature of a trust;
Explain powers and duties of a trustee and the rights of beneficiaries;
Explain the application of equitable remedies to legal problems;
Explain the relationship between equity and law and identify the position and application of the law of equity in the Kenyan legal system;
Prepare trust accounts;

5. Course assessment

Grading will be in accordance with the University Grading Policy. A student will be assessed through:-

Continuous Assessments Tests (30%)
Final Examination (70%)

Total 100%

6. Course requirements

Class attendance and class participation

Class attendance is mandatory, however students who have medical, family or other emergencies over the course of the semester are strongly advised to inform the administration, lecturer and class representative.

Class participation is highly encouraged.

Academic honesty

Students enrolled in this course are expected to exercise a high degree of honesty and integrity in class attendance, participation, assignments and examinations.

NOTE

All students are expected to have done advance reading before the lectures
The Course Director / Lecturer reserves the right to alter the mode of administering the Continuous Assessment Tests
The Course Director / Lecturer shall assign specific additional reading during the course of the semester
The Course Director / Lecturer reserves the right to change the chronology of delivery of the topics and to make alterations to the course outline.

B. RECOMMENDED READING (consult the most recent editions)

Core Texts

Penner, J. (2016) The Law of Trusts, 10th ed., Oxford University Press

Pettit, P. (2012), Equity and the Law of Trusts, 12th ed., Oxford University Press

Bakibanga, D.J., (2011), Equity and Law of Trusts, Professional Book Publishers

Further Reading Materials

Martin, J.E., Modern Equity, 21^st Ed, Sweet and Maxwell

Kuloba, R. (1986), Principles of Injunctions, Nairobi: EABL

Hayton, David J. & Marshall (1992), Commentary and Cases on the Law of Trusts and Equitable Remedies, Sweet & Maxwell

Gardner Simon (2003), An Introduction to the Law of Trusts, 2nd Edition, Oxford University Press 4

Oakley, A.J. (2008), Parker & Mellows: The Modern Law of Trusts, 9th ed., Sweet & Maxwell

McGhee, John (2005), Snell’s Equity, Sweet and Maxwell

Kimari, M (2013), Accounting for Lawyers, 1st ed., lawAfrica

Burn, E. & G. Virgo (2004) Maudsley and Burn’s Trusts and Trustees, 6th ed., Oxford University Press

Fryer, A. (1990) The Accounts of Executors: Administrators & Trustees, London McGraw Hill

Gary Watt (2012) Trusts and Equity 5th ed., Oxford University Press

Jill E. Martin (2009) Modern Equity 18th ed., London : Sweet & Maxwell

Todd and Watt’s, (2011) Cases and Materials on Equity and Trusts, 8th ed., Oxford University Press

Todd and Wilson (2009) Textbook on Trusts, Oxford University Press

Henry, E. et al, Snell, Principles of Equity, 27^th Ed, Sweet & Maxwell

Statutes

Judicature Act Cap 8 Laws of Kenya

Trustee Act, Cap 167 Laws of Kenya

Trustees (Perpetual succession) Act, Cap 164 Laws of Kenya

Public Trustee Act, Cap 168 Laws of Kenya

The Constitution of Kenya 2010

The above materials contained herein are not exhaustive. Students are advised that further readings may be provided during classes.

N/B: Kenyan case laws can be obtained from the Kenya Law website (www.kenyalaw.org). For England and American case law, students are advised to look up the databases hosted at http://www.bailii.org/ and http://www.law.cornell.edu/ respectively.

I. INTRODUCTION

Course description
Course content and course outline

II. OVERVIEW OF LAW OF EQUITY

Meaning, nature and origins of equity

· Definition of key terms

· Historical development of equity

Case law

· Re Diplock [1948] Ch. 465

· Re National Assurance Co. [1878] 10 Ch. D

· Gilles v. Department of Human Resources Development, 11 California Rept. 3^rd, 313

· Re National Assurance Co. [1878] 10 Ch. D

· The Earl of Oxford case [1615] 21 ER 485

· Tulk v. Moxhaney [1848] 18 LJ 88

· Formbay v. Barker [1903] 2 Ch. 539

· Marquis of Waterford v. Night [1844] 11 cl. & f 633

· Heath v. Ridley [1614] Cro. Jac. D. 9

· Walsh v. Lonsdale [1882] vol 2 Ch. D. 9

Method of teaching: Lecture

Justification: effect method of content delivery

III. APPLICATION OF EQUITY IN KENYA AND EAST AFRICA

Sources of Kenyan Law
Objectives / aims of equity

Case law

Ambalal and Co. v. Bowry [1953] 23 EACA 68 (U)
Abdul Karim Khan v. Mohammed Roshan [1965] EA 289, 294-269
Malek Sultan v. Jeraj [1955] EACA 142
Rajab Binti Salim v. Hamad bin Sulaiman [1962] EA 248
Bishan Singh Chadha v. Mohiner Singh [1956] All ER
Shallo v. Maryam [1967] EA 409
Wakf Commissioners v. Public Trustee [1956] EA 368
Patel v. Thakore [1965] EA 629
National House Ltd. V. The Kenya Farmers Association Ltd [1956] EA 96
Walsh v. Lonsdale [1882] vol 2 Ch. D. 9
Bilous v. Bilous [1957] EA 69
Century Automobiles Ltd. V. Hutchings Biemer Ltd. [1965] EA 304
Nurdin Bandali v. Lombak Tanganyika Ltd. [1963] EA 304
Re Commissioner of Income Tax [1891] AC 531
Re Diplock [1948] Ch. 465

Method of teaching: Lecture and class discussion

Justification: effect method of content delivery

IV. MAXIMS OF EQUITY

Equity will not suffer a wrong to be without a remedy (Where there is a wrong there is a remedy for it) Ibi just ibi remedium
Equity follows the law.
Where there is equal equity, the law shall prevail.
Where the equities are equal, the first in time shall prevail.
He who seeks equity must do equity
He who comes to equity must come with clean hands
Delay defeats equity [Equity aids the vigilant and not the indolent (Vigilantibus non dorminentibus jura subveniunt)]
Equity is equality (Equality is equity)
Equity looks to the intent or substance rather than the form
Equity looks upon as done that which ought to be done
Equity imputes an intent to fulfill an obligation
Equity acts in personam

Case law

Bendall v. Mc Whitter [1952] 2 QB 466
Nagel v. Fielden [1966] QB 689
Lord Dudley and Ward v. Lady Dudley [1705] Prec. Cha. 241, 244
Re Bostocks Settlements [1912} 2 Ch. 469
Sextorn v. Horton [1926] 38 ELR 240
Holmes v. Millage [1893] QB 551
Edward v. Deckard [1909] 2 KB 903
Graf v. Hope Building Co-operation [1920] New York Supreme Court
Gibb v. Guild [1882] 9 QB 59
Willoughby v. Willoughby [1756] 1 Term. Rep 763
Chillingworth v. Chambers [1896] 1 Ch. 685
Inglis v. Commonwealth Trading Firm of Australia [1972] ALR 591
Campbell Discount Co Ltd. V. Bridge [1962] AC 600
Meyers v. Casey [1913] 17 CLR 9
Re Diplock [1948] Ch. 465
Cadman v Horner [1810] 34 ER 221
Cory v. Gertken [1816] 36 ER 250
Overton v. Bannister [1884] 3 Hare 503; [1884] 67 ER 479
Kettles and Gas Appliances Ltd. V. Anthony Horden and sons [1834] 35 SR (NSW)
Harigan v. Brown [1967] 1 NSWR 342
Northern Counties of England Fire Insurance Co. v. Whipp [1884] 2 Ch. D. 482
Stocks v. Dobson [1853]
Caliseh v. Forbes [1871] 7 Ch. App 109
Mutual Life Insurance Society v. Langley [1886] 32 Ch. D. 460
Smith v. Clay [1767] 3 BRO CC 639
Erlanger v. New Sombrero Phosphate Co [1873]
Hunter v. Gibbons [1856] 156 ER 1281
Gibb v. Guild [1882]
Re Steel [1979] Ch. D. 219
Kivuitu v. Kivuitu [1991] 2 KAR 241
Griffiths v. Griffiths [1973] 1 WLR 1454
Fredrick v. Fredrick [1821] 24 ER 582; 93 ER 632
Howe v. Earl of Dexmouth [1802]
Parkin v. Thorold [1852] 16 Beav 59
Re. Kayford [1975] 1WLR 279
Penn v. Lord Baltimore [1750]
Richard v. West Partners (Invernes) Ltd. V. Dick [1969] 1 All ER
Webb v. Webb [1994] QB 696

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

V. EQUITABLE REMEDIES

Injunctions

· Meaning, jurisdiction and locus standi

· Classification of injunctions

Specific performance

· The nature of the order

· When it may / may not be granted

· Specific performance and third parties

Rectification

Case law

Doulton Potteries Ltd. V. Bronotte [1974] 1 NSW 591
Shah v. AG [1970] EA 216
Sachoo v. Jopkins [1958] EA 463
AG v. Block [1959] EA 180
Glyn v. Keele University [1971] 1 WLR 487
Giella v. Cassman Brown [1973] EA 358
E.A. Industries v. Trufoods Ltd [1972] EA 420
America Cynamide v. Ethicon Ltd [1975] 2WLR 316
Central Bank of Kenya & Another v. Uhuru Highway Authorities, Kamlesh Pattni and 3 others (unreported civil appeal No. 91 of 1991)
Kenya Tea Development Authority v. Mombasa Exchange Ltd (High Court of Kenya at Nairobi, civil case no of 1992)
Mareva Campania Naveira SA v. International Bulk Carriers SA [1980] 1 All ER 213
Red and Bricks Ltd. V. Morris [1970] AC 652
AG for the Dominion of Canada v. Ritchie [1919] AC 999
Wolverhampton v. Walsall [1873]
AG v. Harris [1960] 3 All ER 407
Jeffreys v. jeffreys [1841] Cr. & Ph. 138
Rigby v. Connel [1880] 4 Ch. D 482
South African Territories Ltd. v. Wallington [1898] AC 309
Beswick v. Beswick [1968] AC 58; [1967] 2All ER
Manchester Breweries co. v. Combs [1901] 2 Ch 608
MacKenzie v. Coulson [1869] LR HEQ 469

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

V. EQUITABLE REMEDIES (continued)

Rescission
Declaration
Accounts
Receivers

Case law

Gist v. Bailey [1967] Ch 532
Phillips v. Brooks Ltd. [1919] 2 KB 243
Erlanger v. New Sombrero Phosphate Co [1873]

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

I. INTRODUCTION TO THE LAW OF TRUSTS

i. Definitions

ii. The Origin of Trusts

iii. Terms Associated with Trusts

iv. Nature of trusts

v. The Relevant Principles of Trust Law

vi. Modern Uses of Trusts

vii. Nature of beneficiaries interests and rights

II. Trusts Distinguished from other Relationships / Concepts

i. Trust and Contract

ii. Trust and Bailment

iii. Trust and Agency

iv. Trust and Power of Appointment

v. Trusts and estates of Deceased Persons

Case law

· The Earl of Oxford’s Case (1615) 1 Rep. Ch. 1

· Cowan v Scargill [1985] Ch. 270

· Pilcher v Rawlins (1872)

· Peter Gitonga v. Francis Maingi M’Ikiara; Meru HC.CC No. 146 of 2000

· Kanyi v. Muthiora 1984 K.L.R 712 (C.A),

· Macharia Kihari v. Ngigi Kihari Civil Appeal No. 170 of 1993

· Westdeutsche Landesbank v. Islington [1996] 2 All E.R. 961

· Re Baden’s Deed Trusts [1973] Ch. 9

· McPhail v. Doulton (1971) A.C. 424

· Re Cockburn’s Wills Trust (Cockburn v. Lewis [1957] 1 Ch. 438.

· Commissioner of Stamp Duties V. Livingstone [1965] A.C. 694

· Re Leigh’s Wills Trust [1970] Ch. 227

· Saunders v Vautier (1841) 4 Beav. 115

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

III. classification OF TRUSTS

A. Inter Vivos and Will Trusts

i. Inter Vivos Trusts

ii. Capacity to Create Trust

iii. Constitution of Trusts

iv. Covenants to settle

v. Exceptions to Equity’s Non-Perfection of Imperfect Gifts

· The rule in Strong v. Bird

· Donatio Mortis Causa

· Dispositions under Will

· Doctrine of Proprietary Estoppel

· Statutory Exceptions

Case law

· Re Estate of The Late Gedion Manthi Nzioka (Deceased) [2015] eKLR

· Lady Naas v Westminster Bank Ltd [1940] AC 366

· Milroy v. Lord (1862) 4 De G.& J. 264

· Strong v. Bird (1874) LR 18 Eq 315

· Cain v. Moon (1896) 2 Q.B. 283

· Benson Mutuma Muriungi v C.E.O. Kenya Police Sacco & another [2016] eKLR

· Michael Murage Njunge v Joseph Gathanwa Njunge [2014] eKLR

· Dillwyn v. Llewelyn (1862) 4 De G.F. & J. 517

B. EXPRESS PRIVATE TRUSTS

i. Requirements for Creation of Express Private Trusts: the three certainities

· Certainty of words or intention and the doctrine of precatory trusts:

· Certainty of the subject matter:

· Certainty of objects:

C. SECRET TRUSTS

i. Fully Secret Trusts

ii. Half Secret Trusts

Ø Rationale for Recognising Secret Trusts

· Fraud Theory

· The Dehors the Will Theory

Ø Special Problems in Connection with Secret Trusts

Case law

· Knight v. Knight (1840) 3 Beav 148

· Re Diggles (Gregory v. Edmonson (1888) 39 Ch.D 253

· Lambe V. Eames (1871) E.R. Ch. App 57

· Mussoorie Bank Ltd v. Raynor (1882) 7 App. Cas 321

· Re Adams & Kensington Vestry [1884] LR 27 ChD 394

· Comiskey V. Bowring –Hanbury (1905) A.C. 84

· Palmer v Simmonds (1854) 2 Drew 221

· Re London Wine Co (Shippers) Limited (1975) 126 NLJ 977

· Boyce v. Boyce (1849) 16 Sim 476

· Re Kolb’s Wills Trusts (1962) Ch. 531

· Morice v Bishop of Durham [1804] EWHC Ch

· Re Barlow’s Will Trusts [1979] 1 All ER 296

· Inland Revenue Commission v. Broadway Cottages CA 26, (1954)

· McPhail v. Doulton 1971 A.C. 424

· Re Gestetner Settlement (1953) Ch. 672

· McPhail v. Doulton 1971 A.C. 424

· McCormick v. Grogan (1869)

· Ottaway v. Norman [1971] All ER 1325

· Estate of Lucien Freud (2014)

· Re Colin Cooper [1939] 3 All ER 586

· Blackwell v. Blackwell [1929] AC 318

· Re Rees [1920] 2 Ch 59

· Re Stead) (1903) 1 IR 73

· Walgrave v. Tebbs (1855) 25 L.J.Ch 241

· Re Boyes (1884) 32 WR 630

· Re Keen’s Estate (1937) 1 All ER 452

· Re Young (1951) 2 All ER 1245

· Re Pughs Wills Trust (1887) WN 143

· Re Rees (1920) 2 Ch 59

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

iii. implied and resulting trusts

Ø Nature of Resulting Trusts

Ø Presumption of Advancement

D. CHARITABLE TRUSTS

i. Features of Charitable Trusts

ii. Four heads of charity

Trusts for the Relief of Poverty
Trusts for the Advancement of Education
Trusts for the Advancement of Religion
Trusts for other Purposes Beneficial to the Community

Case law

· Re Compton [1945] Ch. 123

· Oppenheim v. Tobacco Securities Trust Co. Ltd (1951) A.C. 297

· Commissioners for Special Purposes of Income Tax v. Pemsel (1891) A.C. 531.

· Re Glyn’s Will Trusts (1950) 2 All E.R. 1150

· Re Coulthurst (1951) Ch. 661

· Re Shaw [1957]1 LR 729

· Karen Kayemeth Le Jisroel v. IRC [1931] 2 K.B. 465

· Thornton v. Howe (1862) 54 E.R. 1042

· Re Vandervell’s Trust [1971] 1 All E.R. 47

· Re Gillingham Bus Disaster Fund (1958) Ch. 300

· Charles K. Kandie v Mary Kimoi Sang [2017] eKLR

· Njoki v Gachingiri [1989] LLR 17 (HCK)

· Kivuitu v Kivuitu (1982 – 1988) 2 KAR 241

· Karanja v Karanja, (1976) KLR 307

· Yogendra Purshottam Patel v Pascale Mireille Baksh (Nee Patel) & 2 others [2006] eKLR

· Dyer v. Dyer (1788) 2 Cox Eq. 92,

· Bennet v. Bennet (1879) 10 Ch. D.474

· Tinker v. Tinker [1970] 1 All E.R. 540

· Gascoigne v Gascoigne [1918] 1 K.B. 223

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

F. Constructive Trusts

i. Features of Constructive Trusts

ii. Practical Situations of Imposition of Constructive Trusts

G. Discretionary Trusts

i. Features of Discretionary Trusts

ii. Uses of Discretionary Trusts

H. Protective Trusts

i. Features of Protective Trusts

I. Quistclose Trust

Case law

· Macharia Mwangi Maina & 87 Others v. Davidson Mwangi Kagiri, CA NO. 26 & 27 OF 2011 (Nyeri)

· Mombasa Bricks & Tiles Ltd & 5 others v Arvind Shah & 7 others [2019] eKLR

· Mara v. Browne (1896) 1 Ch. 199

· Soar v. Ashwell (1893) 2 Q.B. 390

· Boursot v. Savage (1866) L.R. 2 Eq. 134

· Lysaght v. Edwards (1876) 2 Ch.D. 499

· Keech v. Sanford (1726) Sel. Cas. King 61; 25 E.R. 223

· McComick v. Grogan (1869) L.R. 4

· Regal (Hastings) Ltd v. Gulliver & Others [1942] 1 All E.R. 378

· Cleaver v. Mutual Reserve Fund Life Association (1892) 1 Q.B. 147

· Re K [1986] Ch. 180

· Duffour v. Pereira (1769) 2 Hargr, Jurid. Arg. 304

· Re Locker’s Settlement [1977] 1 W.L.R. 1323

· Re Smith, Public Trustee v. Aspinall [1928] Ch. 915

· McPhail v. Doulton [1974] A.C. 424

· R.A. Securities Ltd v. Mercantile Credit Co Ltd [1995] 3 All E.R. 214

· Re Kayford [1975] 1 W.L.R. 279

· Farepak Foods & Gifts Ltd. [2006] EWHC 3272

· Re Nanwa Gold Mines Ltd[1955] 1 W.L.R. 1080, Re Australian Elizabethan Theatre Trust (AETT) (1991) 30 FCR 491

· Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

IV. Cy-Près doctrine

i. Cy-Près can be applied where there is a general charitable intention.

ii. Cy-Près can also be applied where the property passes and the charity ceases to exist.

iii. The underlying purpose must be exclusively charitable.

V. WAQF

i. The constituents of waqf

ii. The objective and purpose of waqf

iii. The Interpretation of the document of waqf

Case law

· Re Rymer [1895] 1 Ch 19

· Re Spence [1978] 3 All ER 92

· Biscoe V. Jackson [1887] 35 Ch.D 460

· Re Satterwaite [1966]1 WLR 277

· Re Finger’s Wales Trust [1972] Ch. 286

· Chichester Diocesan Fund v Simpson (1944) 2 All ER 60

· Re Clarke (1923)

· Attorney-General v The Ironmongers’ Company [1834] EngR 1042

· Re Lysaght v. The Royal College of Surgeons [1965] 3 W.L.R. 391(Ch.D.)

· Re North Devon & West Somerset Relief Fund [1953] 1 WLR 1260

· Peggs and Others v Lamb and Others: ChD 20 Apr 1993

· Oldham Borough Council v Attorney General: CA 28 Jul 1992

VI. TRUSTEES

i. Appointment of Trustees

ii. Duties of Trustees

iii. Powers of Trustees

iv. Breach of Trust

v. Retirement of Trustees

vi. Investments by Trustees Generally

· Operations of Investments

· Nature of Trust Accounts

· Duties of the trustees with regard to accounts

· Rights of Beneficiaries

vii. Documents

Case law

· Re Tempest (1866) 35 L.J Ch. 632

· Low v. Bouvery (1891) 3 Ch. 82

· Re Brogden (1888) 38 Ch.D. 546

· Turner v. Corney (1841) 5 Beav. 515

· Fry v. Tapson (1884) 28 Ch.D 268

· Eaves v. Hickson (1861) 30 Beav. 136

· Neville v Benjamin (1900) 1 Ch. 723

· Re Musgrave (1916) 2 Ch. 417

· Craddock v. Piper (1850) 1 Mac & G. 664

· O’Rourke v. Darbyshire [1920] A.C. 581

· Bailey v. Gould (1840) 54 E.R.

· Bahin v. Hughes (1886) 31 Ch.D. 390

· Head v Gould (1989) 2 Ch 250

· Knott v. Cottee (1852) 16 Beav. 77

· Re Partington (1887) 57 L.T. 654

· Re Pauling Settlement Trusts (1964) Ch. 303

· Fletcher v. Fletcher (1844) 4 Hare 67

Method of teaching: Lecture and class discussions

Justification: effect method of content delivery

Course Instructors:

Law Notes II

Thursday, June 19, 2025

EQUITY & THE LAW OF TRUST COURSE OUTLINE

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