Knight v. Knight (1840).

The first issue to be resolved is whether John has made an absolute gift in favour of Jane with a non-legally binding request that she uses the money to buy some small luxuries for herself and enable their children to have the best education or whether he has created a trust of which Jane is the trustee and his children beneficiaries.  This question depends on John’s intention in making the gift and whether he intended to impose a legally binding obligation on Jane.  In Re Adams and the Kensington Vestry (1884) a testator gave property ‘unto and to the absolute use of my dear wife, Harriet … in full confidence that she will do what is right as to the disposal thereof between my children, either in her lifetime, or by will after her decease’.  It was held that the wife took absolutely.  It is not simply a matter of the particular words used but the intention of the donor.

The words used in this case sound uncertain since John has said ‘she can buy’ rather than ‘she must buy’ and it could be argued that as Jane is John’s wife, John might not have felt any necessity to impose a binding legal obligation on her, as John could have relied on Jane using the money in the desired way.  On the other hand the purpose for which the gift is made seems reasonably clear, the education of their children, in contrast to Re Adams and The Kensington Vestry, where, had the court held a trust to exist, it would have been very unclear what its precise terms were.  On balance it is suggested that no trust has been created here and that Jane takes absolutely, free from any legal obligation to use the money for the education of her children, although subject to a very strong moral obligation to do so.

For a trust to be valid, the subject matter must also be certain.  This includes both the property and the beneficial interests which the beneficiaries are to take.  If either of these is uncertain, the trust will fail.  In this case, it is possible that one is uncertain.

The subject matter of the trust is clear in that John left £500,000 to his wife and children.  However, it is not clear what is the size of the beneficial interests.  In his will, John has stated that Jane ‘can buy some small luxuries for herself’ and ‘enable our children to have the best education’, this is indeterminate and it is unclear over what proportion of the money Jane may use towards her small luxuries and her children’s education.  There is apparent uncertainty of subject matter.  In Sprange v. Barnard (1789) there was a gift to Thomas Sprange with a provision that at his death ‘the remaining part of what is left that he does not want for his own wants and uses’ should go to the testator’s brother and sister.  It was held that Sprange was absolutely entitled to the whole gift.  In another case Curtis v. Rippon (1820) the testator gave property to his wife ‘trusting that she will, in fear of God and in love to the children committed to her care, make such use of it as shall be for her own and their spiritual and temporal good, remembering always, according to circumstances, the Church of God and the poor’.  This was hopelessly vague as far as the amounts for the church and poor were concerned.  The widow took all the property absolutely.

There is a clear certainty of objects/beneficiaries as John has stated that he wants to give £500,000 to his wife, Jane and his children.  Consequently, as there is lack of certainty intention and subject matter, this is an absolute gift to Jane, who may use the money for the benefit of her children, but cannot be compelled to do so but would be under a moral obligation to provide her children with the best education.

It is clear from the wording of the second provision in John’s will, that a gift subject to condition precedent is intended.

Where there is a condition precedent attached to a series of individual gifts, it does not matter if it is uncertain if some individuals can satisfy the condition.  The size of the gift to any person who does qualify will not be altered by the numbers in the class.  In Re Barlow’s Will Trusts [1979] the testatrix directed her executor to allow any of her friends who wished to do so to purchase her paintings at a price below the market value.  The direction was held sufficiently certain.  As long as one person qualified as a friend it did not matter about any uncertainty concerning the others.  Therefore, relating this to the provision, the gift will be valid as long as the Southampton Park Pony Club qualifies for the Prince Philip Pony Club Cup Award each year.

If the Southampton Park Pony Club fail to qualify for the Prince Philip Pony Club Cup Award each year, then the £60,000 will be held on trust to be shared equally between all John’s relatives.  There is sufficient evidence of certainty of intention to create a trust.  As the money is to be ‘shared equally’ there is also certainty of subject matter, the relatives are the beneficiaries.

As the trust is not for specified individuals, but for a designated class, it can only be carried out if there is sufficient certainty to enable the trustees to tell who belongs to the class.  Conceptual uncertainty means uncertainty in the definition of the class which is to benefit, in this case, ‘relatives’.

Primarily, it would seem that this trust is a fixed trust as John has defined the beneficial interests (‘to be shared equally’), which the relatives are to receive.  The extent of each relative’s beneficial interest is dependant on the total number of relatives.  The test of certainty of objects in a fixed trust is that the whole range of objects must be ascertained or ascertainable by drawing up a complete and exhaustive list of all the beneficiaries.  The complete list test was laid down in IRC v. Broadway Cottages Trust [1955].

If a comprehensive list of all John’s relatives can be made, which accurately includes the names of all those who are beneficially entitled, while excluding all those who fall outside the class, the money held on trust will succeed.  If it is impossible to draw up a list, the trust will still fail and a resulting trust will arise, with the money going back to the estate.

In conclusion, on advising the executors of John’s estate, the first provision of his will, will be an absolute gift to his wife, Jane and the second provision, a complete comprehensive list of all John’s relative will need to be drawn up in order for an equal distribution of the money to the beneficiaries.