English Trusts Law - Imposed Trusts

Imposed Trusts

See also: English unjust enrichment law and Equitable remedies

While express trusts arise primarily because of a conscious plan, courts also impose trusts by the operation of law. The theoretical difference is that an express trust occurs because of a consent based obligation, where a settlor has consented for his property to be handed to someone else, under the stewardship of a trustee. By contrast, the two main types of imposed trusts, known as "resulting" and "constructive" trusts, arise to give a remedy to reverse unjust enrichment or correct a wrong, and sometimes also to complete a consent based obligation. The legal terminology is generally perceived in academic scholarship as being deceptive out of date, though a minority of equity lawyers primarily in Australia defend the historical terminology. Generally, resulting trusts are imposed by courts when a person receives property, but the person who transferred did not have the intention for them to benefit. This is because English law establishes a presumption that people do not desire to give away property unless there is some objective manifestation of consent to do so. Constructive trusts arise in around eight circumstances, all different. But generally, the courts will "construe" a person to hold property for another person, first, to avoid strict operation of rules on formality, second, to reflect a person's contribution to the value of property, and third, to effect a remedy, possibly with a proprietary response.