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Chapter 3 Multiple choice questions
Return to Complete Equity and Trusts 5e Resources
Chapter 3 Multiple choice questions
Quiz Content
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What is the difference between a bare power and a fiduciary power?
With a bare power the appointor can choose any object he/she wants
correct
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With a bare power the appointor can decide not to appoint
correct
incorrect
With a bare power the appointor cannot choose to appoint to a non object
correct
incorrect
With a fiduciary power the appointor must carefully consider the choice of object
correct
incorrect
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The difference between a fiduciary power and a discretionary trust is that
In a fiduciary power the trustees need not consider whether they should exercise the power
correct
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In a fiduciary power the trustees can choose anyone that they want
correct
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In a fiduciary power the beneficiaries have no right to be chosen
correct
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In a fiduciary power the trust property does not belong to the beneficiaries
correct
incorrect
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In order to declare a valid trust it is essential to
Use the word 'trust'
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Put the declaration in writing
correct
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Use imperative words
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Impose a binding moral obligation upon the intended trustee
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Why must a trust have certainty of objects?
So that the courts can enforce the trust
correct
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So that the trustees can list the beneficiaries
correct
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So that the relatives of the deceased know who can claim against the estate
correct
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So that the Attorney General can enforce the trust
correct
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Which of the following descriptions of property would
not
satisfy the certainty of subject matter test?
The bulk of my residuary estate
correct
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A reasonable income
correct
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5 per cent of the shares in my company
correct
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All of my real and personal property
correct
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Which of the following description of potential beneficiaries would fail the certainty of objects test?
Urgent suppliers
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Friend or friends nominated by my wife
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Carol and the kids
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Relatives or dependents
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The test for certainty of objects in a fixed trust is:
Evidential certainty
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Ascertainability
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Administrative workability
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Exhaustive enumeration
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The certainty of objects test in
McPhail v Doulton
[1971] AC 424, states that 'the trust is valid if it can be said with certainty that any given individual is or is not a member of the class'. This test means that the objects of a discretionary trust must be
Evidentially certain
correct
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Ascertainable
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Conceptually certain
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Not so numerous that the trust is unworkable
correct
incorrect
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A discretionary trust or fiduciary power can be ruled invalid if there are too many beneficiaries in the class. Which of the following descriptions of a class has been held invalid?
The residents of Greater London
correct
incorrect
The inhabitants of the County of West Yorkshire
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Such person or persons as the trustees think fit
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Any person or persons, corporation or corporations or charity or charities that the trustees think fit
correct
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What happens to the 'trust property' if a trust fails for lack of certainty of intention?
The property returns to the estate of the settlor or testator on a resulting trust
correct
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The 'trustee' can keep the property
correct
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The property is divided equally between the beneficiaries
correct
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The trustee holds the property on constructive trust
correct
incorrect
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