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Beneficial Entitlement - Coggle Diagram

- - - - Objects have the power to bring the trust to an end by exercising the rule in Saunders v Vautier
        
        Providing all beneficiaries meet the conditions relating to age and soundness of mind, and they agree possible for MULTIPLE individuals
        
        Possible in DISCRETIONARY trusts provided ALL objects agree
        
        Legal title reaches the beneficiary, equitable interest merges into it and beneficiary becomes the full legal owner
        
        Absolutely entitled beneficiary (over 18 and sound mind) requesting trustee transfers trust property to them
      - Objects of a DISCRETIONARY trust do NOT have proprietary rights
        
        Until discretion is exercised, all the objects have is a hope discretion will be exercised in their favour
        
        CANNOT assert their rights against third parties
        
        Have sufficient interest in the trust property to compel its return to the trust fund
      - Beneficiaries of a FIXED trust have equitable proprietary rights
        
        Rights may be VESTED (current right) or CONTINGENT (right is conditional) but they are proprietary
        
        These rights are assets which are capable of sale or other forms of transfer and can be asserted against third parties
    - - Beneficiaries of DISCRETIONARY trusts
        
        NO right to request discretion exercised in a particular way
        
        Once a discretion is exercised in favour of an individual, they have the right to be informed of their entitlement
        
        Enforce the trust by asking court to ensure discretion is exercised whether by trustees, appointment of new trustees or court itself
        
        They can sue trustee for breach of trust and require the trustee to personally compensate trust fund for any loss
      - Beneficiaries of FIXED trusts
        
        They can direct the trustee to take action such as suing a third party on behalf of the trust
        
        Beneficiaries can always sue trustees for breach of trust if they act outside their powers or breach their duties
        
        Any compensationpaid back to the trust fund
        
        Right to compel the proper administration of the trust by the trustees
        
        Right to be informed of their entitlement under the trust once interest has vested
- - - - Allows testators to provide for their spouse but ensures that the spouse cannot disinherit their children
    - - A beneficiary (‘life tenant’) receiving income during their lifetime
      - Another beneficiary or beneficiaries (the ‘remainderman’) entitled to the capital after the life tenant’s death
- - - - Beneficiary’s interest is lost if the condition is satisfied
      - Beneficiary has an entitlement unless and until the condition is satisfied
    - - Vested ‘in interest’
        
        Current right to FUTURE enjoyment of the property
      - Vested ‘in possession’
        
        Current right to CURRENT enjoyment of the property
  - - - Beneficiary has an immediate interest in the property
      - But can be divested by the occurrence of a future event
      - Entitled to the income, if satisfied entitlement to BOTH the income and capital ceases
    - - Beneficiary does NOT obtain vested interest unless and until the contingency is satisfied
      - Beneficiary may receive accumulated income along AND capital
  - - - NO no entitlement to have it transferred to them and become the absolute owner
    - - In the case of contingent interests, this will include the objects of any gift-over
    - - Exercising their Saunders v Vautier rights by directing the trustee to transfer the property out of the trust (whether to them or to a third party)
      - OR remaining objects of the trust and allowing trustees to continue to act in accordance with the terms of that trust