The Enforceability of A Covenant to Create A Trust

Publication Date01 Jul 1966
DOIhttp://doi.org/10.1111/j.1468-2230.1966.tb01128.x
AuthorDuncan Mathebon
THE ENFORCEABILITY OF
A
COVENANT
TO
CREATE
A
TRUST
“WHEIIE
the parties to
a
marriage settlement covenant to settle
after-acquired property, and property falling within the covenant
is later acquired, but not conveyed to the trustees, then those
beneficiaries who are within the marriage consideration may sue
to enforce the covenant, even if the limitation period has
run
out.
But if
it
is the next of kin (and
so
volunteers) who sue as benefi-
ciaries over, they will not succeed, for equity will not assist
a
volunteer.” That is the orthodox statement of principle for which
Re Plumptre’s Mam’age Settlement
and
Pullan
v.
KoeB
are
authority. The principle
is
now well established, but the reasons
on
which
it
is
based are not entirely free from difficulty, and this
article is directed towards examining these problems.
In
Re Plumptre’s Mamiage Settlement
the settlement contained
the usual covenant to settle after-acquired property:
in
1884
the
husband invested some money
in
his
wife’s .name; she later sold
this stock, reinvesting the proceeds
in
her
own
name,
in
which state
thcy remained until her death, intestate and without issue,
in
1909.
In
an
action to enforce the covenant, Eve
J.
held that the money
fell within the covenant, but that
it
could not now be claimed.
No
action could be brought
on
the covenant at law; the breach
had occurred in
18841,
and the limitation period had by now expired,
thus defeating any action at law-Spickernell
v.
H~tharn.~
The
plaintiffs must therefore seek the help of equity, but since they
were volunteers, that help would not be forthcoming;
nor
would
the principle that
equity
looks
on
as
done that which ought
to
be
donc
yy
assist them, for, as Lindley
L.J.
had said in
Re Anstis
:
But this rule, although usually expressed in general terms,
is
by
no
means universally true. Where the obligation to do
what ought to be done is not an absolute duty, but only an
obligation arising from contract, that which ought to be done
is
only treated as done in favour of some person entitled to
enforce the contract
as
against the person liable to perform
it.,,
In
Pullan
v.
Koe
(I
the facts were almost identical except in the
all-important respect that the claimants were within the marriage
.consideration, and not therefore to be treated as volunteers
-At torney-General
v.
Jacobs-Smith.”
This
enabled Swinfen-Eady
1
[lOlO]
1
Ch.
009.
2
[1918]
1
Ch.
9.
8
(1864)
Kay
069.
4
(1886)
81
Ch.D.
606
at
p.
605
5
[1918]
1
Ch.
0.
[1895]
9
Q.B.
841.
807

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