Graham Virgo: Right at the heart of equity is the trust
and the trust may take many forms
but right at the heart of it is the fact that we have a trustee, who has legal title to the trust property.
And in many cases, the trustee holds the trust property on trust
for the beneficiary or the beneficiaries.
And it follows, in equity, that the beneficiaries have rights relating to the trust.
But what is the nature of those rights of the beneficiary?
Well there are various views on that.
Some people say that those rights are always proprietary,
some people say they are always personal,
and others say, actually it's rather more complicated than that.
It's a bit of both and may be more precise.
Now in my view, the beneficiary has proprietary and personal rights.
The beneficiary has proprietary rights, recognized in equity,
relating to the trust property.
Now what the nature of those rights actually are, you have to consider quite carefully,
what makes a right a proprietary right?
Is it a right to claim the property?
Is it a right to receive the income or the products of that property?
And what are the limitations on that proprietary right?
When will the proprietary right be terminated?
But it’s also the case that beneficiaries have personal rights.
If the trustee breaches the trust, then the beneficiary will have a right to sue the trustee
for breach of trust and claim personal remedies as a consequence.
So, it's clear therefore, that beneficiaries have rights in equity
relating to the trust which are proprietary and are personal.
Now the more difficult question is the nature of that proprietary right
and comparing that right to a right of law. What are the differences?
It certainly is the case that the equitable right, proprietary right,
might be defeated more easily in equity than at law.
That has an important implication for our understanding of that equitable right,
which is certainly subordinate to the legal proprietary right.
But as you think through the nature of the rights of the beneficiary—
particularly relating to proprietary rights—
think hard about the nature of those proprietary rights,
and what the limitations on those rights might be.