How do you enforce a constructive trust?
How do you enforce a constructive trust?
Enforcement of a Constructive Trust The establishment of a constructive trust is typically imposed by a court of law. The court may choose to enforce this equitable remedy if the defendant would receive an unfair advantage if the trust is not imposed, or if the defendant has interfered with an existing trust.
How does a constructive trust work?
A constructive trust is an equitable remedy imposed by a court to benefit a party that has been wrongfully deprived of its rights due to either a person obtaining or holding a legal property right which they should not possess due to unjust enrichment or interference, or due to a breach of fiduciary duty, which is …
What is the difference between a resulting trust and a constructive trust?
A resulting trust is based upon the presumed intention that arises where a person provides funds for the purchase of property. A constructive trust is founded upon a common intention that can either be expressed or inferred but cannot be based upon an intention that the parties never in fact had.
What are the three requirements of a constructive trust?
“The imposition of a constructive trust requires: (1) the existence of res (property or some interest in property); (2) the right of the complaining party to that res; and (3) some wrongful acquisition or detention of the res by another party who is not entitled to it.” See Burlesci v.
What is constructive trust in family law?
A constructive trust remedy gives the claimant an interest in the other spouse’s property. there is a causal connection between their contributions and the acquisition (purchase), preservation, maintenance or improvement of the property in question, and. that a monetary award would not be sufficient.
What is the meaning of constructive trust?
A constructive trust is not an actual trust by the traditional definition. It is a legal fiction that is used as a remedy for unjust enrichment. Hence, there is no trustee, but the constructive trust orders the person who would otherwise be unjustly enriched to transfer the property to the intended party.
How do you prove unjust enrichment?
To claim for unjust enrichment, the claimant must be able to successfully prove that:
- There was an enrichment or benefit received by the defendant;
- A loss was suffered by the plaintiff related to the enrichment, and;
- There was no juristic reason for the enrichment.
How does a resulting trust arise?
A ‘resulting trust’ arises when “B” has made a direct financial contribution to the purchase of the property registered solely in “A”’s name. It is important to have evidence of this payment and to show that this contribution to the purchase was not intended to be a gift or a loan.
Why do automatic resulting trusts arise?
An automatic resulting trust will arise where the settlor transfers property to the intended trustee but the trust has failed for some reason. The trustee holds the legal title of the property on trust. The beneficial or equitable ownership is retained by the settlor.
What are the two forms of implied trust?
There are two types of implied trusts. These are constructive trusts and resulting trusts.
What is a constructive trust in land law?
Constructive trusts are trusts that may be implied in the absence of a declaration of trust, where the trustee has induced another to act to their detriment in the belief that if they do so act to their detriment they would acquire a beneficial interest in the land (Gissing v Gissing [1971] AC 881 Case summary).
Is constructive trust a cause of action?
A constructive trust is an extraordinary remedy, not a cause of action. Instead, a constructive trust is imposed based upon an established cause of action. One such cause of action is breach of fiduciary duty, often seen in probate and trust litigation.
What are resulting and constructive trusts?
What is the difference between resulting and constructive trusts? Constructive trusts are imposed by the court as an equitable remedy where it would be unconscionable for the other party to hold onto the property. However, resulting trusts give effect to the implied intentions of the owner.
What does implied resulting or constructive trust mean?
A constructive trust is typically implied into the circumstance to prevent the person holding the property from unjustly benefiting from the property’s beneficiaries. Where there is no formal Trust Deed, the arrangement between the parties are such that an implied trust should be constructed between them.
What is an implied trust in land?
An implied trust is an element of trust law, and refers to a trust that has not been “expressly created by the settlor.” There are two types of implied trust: Resulting trust. Constructive trust.
What is an institutional constructive trust?
Institutional / Remedial constructive trust Since an institutional constructive trust does not arise from the judgment of the court, it is capable of gaining priority over any interests acquired by third parties in the trust property during the period between the creation of the trust and its recognition by the court.
What is a passive trust?
A common form of trust is a passive trust, whereby a trustor gives legal ownership of assets like money or real estate to a trustee, who is then responsible for simply distributing those assets to a beneficiary at a predetermined date.
What is the purpose of a discretionary trust?
A Discretionary Trust is a legal arrangement which allows the owner of a life policy (the settlor) to give their policy to a trusted group of people (the trustees), who look after it. At some time in the future they pass it on to some people from a group that the settlor has decided (the beneficiaries).
What is an equitable lien in real estate?
equitable lien. n. a lien on property imposed by a court in order to achieve fairness, particularly when someone has possession of property which he/she holds for another.
Should the remedial constructive trust be formally Recognised in English law?
Remedial constructive trusts are recognised in other common law jurisdictions. However,in accordance with Lord Neuberger’s statement, the approach taken to the constructive trust in English law is, purportedly, strictly institutional, due to judicial reluctance to change or create proprietary rights.
How are equitable liens created?
Equitable liens are created when there is “no adequate remedy at law”[2] for a breach of contract or other harm, which usually means a money judgment is impractical or impossible.
What is an example of an equitable lien?
An equitable lien is a claim on a wrongdoer’s property that is placed by a court of equity, or through an equivalent legal proceeding. A common example of a situation where an equitable lien might be appropriate involves the embezzlement of the proceeds from a trust by a trust administrator or trustee.
Is a mortgage an equitable lien?
In title theory states, a lender holds the actual legal title to a piece of real estate for the life of the loan while the borrower/mortgagor holds the equitable title.
What is difference between Lien and mortgage?
A right to keep possession of Property belonging to another person until a debt owed by that person is discharged. A mortgage is an independent and principal right and not a mere security. A lien is only a security for a debt. It is merely a right to retain possession of chattel until payment is made.
Can you refinance a mortgage with a lien?
If you have a judgment, collection account, or tax lien against your property, you may still be eligible for a cash-out refinancing if the money is used to pay off a judgment or lien. In some cases, the lender may make a direct payment to the creditor if it is an underwriting contingency.
How does a mortgage lien work?
A lien gives an individual or entity a claim to a property until a debt is paid off. If the debt goes unpaid, they have the right to take it back. Although we’re focusing specifically on homes in this post, you could also have a lien on your car or other possession that you pay off over time.
