70517 Equity and Trusts

Warning: The information on this page is indicative. The subject outline for a particular semester, location and mode of offering is the authoritative source of all information about the subject for that offering. Required texts, recommended texts and references in particular are likely to change. Students will be provided with a subject outline once they enrol in the subject.

UTS: Law
Credit points: 8 cp

Subject level:

Undergraduate and Postgraduate

Result type: Grade and marks

Requisite(s): 70317 Real Property
Anti-requisite(s): 70516 Equity and Trusts

Handbook description

This subject covers two related fields of study.

In 'equity' students examine the doctrines and remedies which were originally developed in the Courts of Chancery in England prior to 1873 to ameliorate the harshness of the common law and which are still applied today to the largely same effect, with some modification from time to time. Equitable doctrines and remedies do not replace the common law but supplement it in significant ways by recognising and enforcing obligations which are not known to the common law and by granting remedies in respect of those obligations which are not available at common law. These doctrines and remedies are now administered in the same courts in which the common law is administered. Many areas of law are touched by equitable doctrines and remedies. In particular, the law of contract and property law are significantly affected by equity. Through the study of equity, students examine the range of discretionary remedies which are available for breach of particular obligations.

In 'trusts' students explore the concept of a trust which was developed in the Courts of Chancery, whereby an interest in property is legally owned by one party but held for the benefit of another person or purpose permitted by law. The obligations of the party owning the interest at law, and the rights of the beneficiary to that interest, continue to be recognised and enforced in equity. Trusts are now commonly used in both private arrangements and for commercial purposes, having particular consequences for taxation and insolvency. The relevant principles and modern applications of trusts are considered.

Subject objectives

1.	Understand the rationale and application of equitable doctrine and have an individual perspective on the philosophy of equity
2.	Critically evaluate existing legal principles and institutions with a view to determining what reforms, if any, are needed
3.	Think creatively in approaching legal issues and generating appropriate responses from own research
4.	Critically analyse and evaluate research materials using criteria related to the aims of the inquiry
5.	Apply critical analysis creatively to an approved inquiry
6.	Execute a substantial written task using appropriate structure expression, grammar, spelling and referencing
7.	Demonstrate the ability to construct a logical, reasoned and persuasive argument
8.	Demonstrate advanced critical thinking and own research

• Legal Knowledge
  A coherent understanding of fundamental areas of legal knowledge including the Australian legal system, social justice, cultural and international contexts and the principles and values of ethical practice. (1.0)
• Critical Analysis and Evaluation
  A capacity to think critically, strategically and creatively including an ability to identify and articulate legal issues, apply reasoning and research, engage in critical analysis and make reasoned choices. (3.0)
• Research skills
  Well-developed cognitive and practical skills necessary to identify, research, evaluate and synthesise relevant factual, legal and policy issues. (4.0)
• Communication and Collaboration
  Effective and appropriate communication skills including highly effective use of the English language, an ability to inform, analyse, report and persuade using an appropriate medium and message and an ability to respond appropriately. (5.0)

Teaching and learning strategies

Strategy 1
Independent Learning Skills: The subject guide sets out recommended reading for each topic. Students should aim to read as widely as possible from the recommended readings and cases in the lecture outlines.

Strategy 2
Lectures: Designed to supplement and clarify issues and explain significance of cases and development in the law in each topic.

Strategy 3
Tutorials: Provide an opportunity to participate in group discussion solving problems derived from real cases. These are essential skills for practice as a solicitor or barrister.

Strategy 4
Research Essay: provides practice in high level research and legal writing with feedback to indicate where the student has achieved well or needs to develop these skills.

Lecture Format

Lectures: 4 hours per week (2 x 2 hours)

The lectures are designed to supplement independent reading on a topic area by clarifying important issues and principles and providing illustrations of their application in practice.

Students should also aim to read from recommended texts included in the Subject Guide and cases in the Lecture Outlines in order to understand the material that is covered in lectures.

Tutorial Format

Tutorials: 2 hours per week (1 x 2 hours)

Tutorials provide an opportunity to practise solving real legal problems drawn from case law, and to discuss unsettled areas in law. Students must prepare for tutorials by attempting answers to problem questions set out in the Subject Guide. Students should also use the opportunity to discuss issues arising from the topic of the week and raise any questions.

Students must attend the tutorial in which they have registered unless prior consent is given by tutors.

Tutorials will conclude with a weekly quiz. Students must attend 5 out of 7 assessable quizzes in order to be eligible for the full 20% class participation mark.

Content

Introduction to Equity, History and Nature of Equity

• General comparison between Common Law and Equity
• Historical development of Equity
• Maxims of Equity
• Judicature System and modern administration of equity
• Fusion theory

Unconscionable dealings/ Undue Influence

• Undue Influence - elements
• Unconscionable Dealings - elements
• Remedies: rescission, equitable compensation, constructive trust

Estoppel in Equity

• Categories of Estoppel at Common Law and in Equity
• Equitable Estoppel - development of, elements and application
• Remedies for Equitable Estoppel; declaration, constructive trust, equitable lien, equitable charge, equitable compensation

Doctrine of Part Performance

• Elements
• Remedy: specific performance

Fiduciary Obligations

• Scope and content of fiduciary duties
• Rule against conflict of interest and duty
• Rule against unauthorised profit
• Remedies for breach: constructive trust, account of profits

Liability of Third Parties for Breach of Fiduciary Duty or Trust

• The rule in Barnes v Addy
• Knowing receipt
• Knowing Assistance
• Remedies: constructive trust, equitable compensation

Equitable Estates and Interests

• What is Property?
• Multiple classification of equitable rights
• Equitable proprietary interest, mere equity and personal equities
• Types of equitable proprietary interests; features

Assignment of Property in Equity

• Equitable assignment of legal property
• Equitable assignment of equitable property
• Assignment of future property
• Writing requirements in assignment of equitable interests.

Introduction to Trusts/ Express Trusts

• Elements of a trust, types of trusts
• Creation of Express Trusts
• The Three Certainties: Intention, Subject Matter, Object
• Complete Constitution, Secret Trusts, Precatory Trusts
• Rule against Perpetuities

Charitable Trusts

• Beneficiary Principle
• Four Divisions of charitable purposes

Resulting Trusts

• 'Automatic' resulting trusts: incomplete disposition of beneficial interest
• 'Presumed' resulting trusts: contributions to property purchase
• Presumption of advancement
• Illegality

Constructive Trusts (other than for breach of fiduciary duty or third party liability already covered in Topics 5 and 6)

• Features of constructive trusts
• Nature - remedy or institution?
• Different categories of constructive trust
• Constructive trusts to enforce agreements concerning property
• Constructive trusts to remedy an unconscionable retention of benefit
• Other categories of constructive trusts: stolen property, unlawful killing

Duties, Powers and Liabilities of Trustees, Rights of Beneficiaries

• Duties of a trustee: loyalty; to preserve trust property; to insure trust property; of investment; to act gratuitously, to keep accounts; duty of honesty; to pay trust fund to correct beneficiaries; to act impartially.
• Powers of a trustee: sale, management, maintenance and advancement, to mortgage.
• Rights of a trustee: reimbursement and indemnity; reimbursement from beneficiaries; right of contribution; other rights.
• Liability of a trustee in breach of trust.
• Rights of beneficiaries: to extinguish trust, to compel performance, to restrain breach, to possession of trust property, to information.
• Rights of discretionary beneficiaries.

Assessment

Assessment task 1: In-class tutorial quizzes

Intent:	The weekly quizzes are intended to give students weekly feedback on their level of understanding of important issues in each topic.
Objective(s):	This task addresses the following subject learning objectives: 1 This task contributes specifically to the development of the following graduate attributes: 1.0, 3.0, 4.0 and 5.0
Weight:	20

Assessment task 2: Research Essay

Intent:	The research essay is intended to give students experience in: undertaking relevant legal research in the equity jurisdiction; reading and interpreting case law and legislation correctly and effectively; constructing clear and persuasive legal argument in writing; understanding the rationale and application of equitable doctrine, principles and rules; evaluating critically existing legal principles and institutions with a view to determining what reforms, if any, are needed; and developing an individual perspective on the philosophy of equity.
Objective(s):	This task addresses the following subject learning objectives: 1, 2, 3, 4, 5, 6, 7 and 8 This task contributes specifically to the development of the following graduate attributes: 1.0, 3.0, 4.0 and 5.0
Weight:	40
Length:	2,500 words

Assessment task 3: Formal Examination

Intent:	The formal examination is intended to ensure that students can demonstrate sufficient competence in: solving legal problems by reasoned and substantiated analysis; applying equitable doctrine, principles and rules correctly and effectively.
Objective(s):	This task addresses the following subject learning objectives: 1, 5 and 7 This task contributes specifically to the development of the following graduate attributes: 1.0, 3.0, 4.0 and 5.0
Weight:	40

Required texts

None

Recommended texts

1. Evans M, Equity & Trusts (LexisNexis Butterworths, 3rd ed, 2012)
2. Meagher R, Heydon D, Leeming M, Meagher Gummow & Lehane's Equity Doctrines & Remedies, (LexisNexis Butterworths, 4th ed, 2002)
3. Heydon JD, Leeming MJ, Jacobs' Law of Trusts in Australia, (LexisNexis Butterworths, 7th ed, 2006)
4. Dal Pont GE, Equity & Trusts in Australia, (Lawbook Co, 5th ed, 2011)
5. Radan P, Stewart C, Principles of Australian Equity & Trusts (LexisNexis Butterworths, 2010)
6. Heydon JD & Loughlan PL, Cases and Materials on Equity & Trusts, (LexisNexis Butterworths, 8th ed, 2011).
7. Parkinson P (ed.), The Principles of Equity, (Lawbook Co, Australia, 2nd ed, 2003).
8. Covell W & Lupton K, Principles of Remedies, (LexisNexis Butterworths, 2008)
9. Tilbury M, Noone M & Kercher B, Remedies: Commentary and Materials, (Law Book Co, 2004)

References

Reports, Journals and General References

1. Journal of Equity
2. Law Quarterly Review
3. Ford & Lee, Law of Trusts in Australia
4. Maitland’s Lectures in Equity
5. Fredrick Jordan, Select Legal Papers
6. Australian Guide to Legal Citation (3rd ed)

Other resources

Other Materials

Students are advised to be aware of relevant policies, rules and regulations that might be applicable to their candidature and assessment matters.

1. UTS Law Subject Information Booklet 2014
2. UTS Law Faculty Guide to Essay Writing (www.law.uts.edu.au/students/assessment/submitting.html)
3. UTS Coursework Assessment Policy and Procedure Manual (http://www.gsu.uts.edu.au/policies/coursewkassess.html

Lecture Recording

Audio or visual recording of classes for this subject is strictly prohibited unless written approval is sought and given in advance from the Subject Coordinator. Approval for audio or visual recording will usually be limited to medical or hardship reasons, and if approved, must be arranged by the student.

Lectures: audio recording by AVS, available on UTSOnline

E&T lecture audio recordings will be made available for download from UTSOnline during the week following any given lecture. The recordings are edited and do not reflect discussion with students or responses to questions. Accordingly, students are advised to attend lectures where possible and to use the recordings only as a backup or additional resource in revising lecture notes.

You should expect a delay of at least 24-48 hours before the audio recording of lectures is made available on UTSOnline. Please do not ring the Law Reception Office to ask when the lecture recording will be put online.

Please also note that no responsibility is taken for the quality or reliability of this taping service and that no Special Consideration applications will be considered in relation to problems experienced by students using this taping service. Students may only use these audio-tapes for private student purposes (and to avoid legal action) permission must be obtained from the Subject Coordinator for any other usage. Technical difficulties with the taping of a lecture, which do occur from time to time, will not result in any re-recording of the lecture.

The E&T subject is taught in a face-to-face mode, in scheduled lectures, tutorial activities, recommended readings, assessment tasks etc.
The Law Faculty cares for the learning and welfare of its students; therefore, there are flexible timetable arrangements for lectures (and repeats of lectures) as well as tutorials. In addition, lecture recordings are available, subject to technical issues, as an additional resource or back up for students who happen to miss a lecture (and its repeat) due to illness etc. The teaching staff bear no responsibility for the quality, reliability or availability of the audio lecture recordings.