Trusts of Land and Appointment of Trustees Act 1996

Cited as:1996 c. 47
Jurisdiction:UK Non-devolved


Trusts of Land andAppointment of Trustees Act1996

1996 Chapter 47

An Act to make new provision about trusts of land including provision phasing out the Settled Land Act 1925, abolishing the doctrine of conversion and otherwise amending the law about trusts for sale of land to amend the law about the appointment and retirement of trustees of any trust and for connected purposes.

[24th July 1996]

B e it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

I Trusts of land

Part I

Trusts of land

Introductory

Introductory

S-1 Meaning of ‘trust of land’.

1 Meaning of ‘trust of land’.

(1) In this Act—

(a) ‘trust of land’ means (subject to subsection (3)) any trust of property which consists of or includes land, and

(b) ‘trustees of land’ means trustees of a trust of land

(2) The reference in subsection (1)(a) to a trust—

(a) is to any description of trust (whether express, implied, resulting or constructive), including a trust for sale and a bare trust, and

(b) includes a trust created, or arising, before the commencement of this Act

(3) The reference to land in subsection (1)(a) does not include land which (despite section 2) is settled land or which is land to which the Universities and College Estates Act 1925 applies

Settlements and trusts for sale as trusts of land

Settlements and trusts for sale as trusts of land

S-2 Trusts in place of settlements.

2 Trusts in place of settlements.

(1) No settlement created after the commencement of this Act is a settlement for the purposes of the Settled Land Act 1925 and no settlement shall be deemed to be made under that Act after that commencement

(2) Subsection (1) does not apply to a settlement created on the occasion of an alteration in any interest in, or of a person becoming entitled under, a settlement which—

(a) is in existence at the commencement of this Act, or

(b) derives from a settlement within paragraph (a) or this paragraph

(3) But a settlement created as mentioned in subsection (2) is not a settlement for the purposes of the Settled Land Act 1925 if provision to the effect that it is not is made in the instrument, or any of the instruments, by which it is created.

(4) Where at any time after the commencement of this Act there is in the case of any settlement which is a settlement for the purposes of the Settled Land Act 1925 no relevant property which is, or is deemed to be, subject to the settlement, the settlement permanently ceases at that time to be a settlement for the purposes of that Act.

In this subsection ‘relevant property’ means land and personal chattels to which section 67(1) of the Settled Land Act 1925 (heirlooms) applies.

(5) No land held on charitable, ecclesiastical or public trusts shall be or be deemed to be settled land after the commencement of this Act, even if it was or was deemed to be settled land before that commencement.

(6) Schedule 1 has effect to make provision consequential on this section (including provision to impose a trust in circumstances in which, apart from this section, there would be a settlement for the purposes of the Settled Land Act 1925 (and there would not otherwise be a trust)).

S-3 Abolition of doctrine of conversion.

3 Abolition of doctrine of conversion.

(1) Where land is held by trustees subject to a trust for sale, the land is not to be regarded as personal property and where personal property is subject to a trust for sale in order that the trustees may acquire land, the personal property is not to be regarded as land.

(2) Subsection (1) does not apply to a trust created by a will if the testator died before the commencement of this Act.

(3) Subject to that, subsection (1) applies to a trust whether it is created, or arises, before or after that commencement.

S-4 Express trusts for sale as trusts of land.

4 Express trusts for sale as trusts of land.

(1) In the case of every trust for sale of land created by a disposition there is to be implied, despite any provision to the contrary made by the disposition, a power for the trustees to postpone sale of the land and the trustees are not liable in any way for postponing sale of the land, in the exercise of their discretion, for an indefinite period.

(2) Subsection (1) applies to a trust whether it is created, or arises, before or after the commencement of this Act.

(3) Subsection (1) does not affect any liability incurred by trustees before that commencement.

S-5 Implied trusts for sale as trusts of land.

5 Implied trusts for sale as trusts of land.

(1) Schedule 2 has effect in relation to statutory provisions which impose a trust for sale of land in certain circumstances so that in those circumstances there is instead a trust of the land (without a duty to sell).

(2) Section 1 of the Settled Land Act 1925 does not apply to land held on any trust arising by virtue of that Schedule (so that any such land is subject to a trust of land).

Functions of trustees of land

Functions of trustees of land

S-6 General powers of trustees.

6 General powers of trustees.

(1) For the purpose of exercising their functions as trustees, the trustees of land have in relation to the land subject to the trust all the powers of an absolute owner

(2) Where in the case of any land subject to a trust of land each of the beneficiaries interested in the land is a person of full age and capacity who is absolutely entitled to the land, the powers conferred on the trustees by subsection (1) include the power to convey the land to the beneficiaries even though they have not required the trustees to do so and where land is conveyed by virtue of this subsection—

(a) the beneficiaries shall do whatever is necessary to secure that it vests in them, and

(b) if they fail to do so, the court may make an order requiring them to do so.

(3) The trustees of land have power to purchase a legal estate in any land in England or Wales.

(4) The power conferred by subsection (3) may be exercised by trustees to purchase land—

(a) by way of investment,

(b) for occupation by any beneficiary, or

(c) for any other reason.

(5) In exercising the powers conferred by this section trustees shall have regard to the rights of the beneficiaries.

(6) The powers conferred by this section shall not be exercised in contravention of, or of any order made in pursuance of, any other enactment or any rule of law or equity.

(7) The reference in subsection (6) to an order includes an order of any court or of the Charity Commissioners.

(8) Where any enactment other than this section confers on trustees authority to act subject to any restriction, limitation or condition, trustees of land may not exercise the powers conferred by this section to do any act which they are prevented from doing under the other enactment by reason of the restriction, limitation or condition.

S-7 Partition by trustees.

7 Partition by trustees.

(1) The trustees of land may, where beneficiaries of full age are absolutely entitled in undivided shares to land subject to the trust, partition the land, or any part of it, and provide (by way of mortgage or otherwise) for the payment of any equality money.

(2) The trustees shall give effect to any such partition by conveying the partitioned land in severalty (whether or not subject to any legal mortgage created for raising equality money), either absolutely or in trust, in accor dance with the rights of those beneficiaries.

(3) Before exercising their powers under subsection (2) the trustees shall obtain the consent of each of those beneficiaries.

(4) Where a share in the land is affected by an incumbrance, the trustees may either give effect to it or provide for its discharge from the property allotted to that share as they think fit.

(5) If a share in the land is absolutely vested in a minor, subsections (1) to (4) apply as if he were of full age, except that the trustees may act on his behalf and retain land or other property representing his share in trust for him.

S-8 Exclusion and restriction of powers.

8 Exclusion and restriction of powers.

(1) Sections 6 and 7 do not apply in the case of a trust of land created by a disposition in so far as provision to the effect that they do not apply is made by the disposition.

(2) If the disposition creating such a trust makes provision requiring any consent to be obtained to the exercise of any power conferred by section 6 or 7, the power may not be exercised without that consent.

(3) Subsection (1) does not apply in the case of charitable, ecclesiastical or public trusts.

(4) Subsections (1) and (2) have effect subject to any enactment which prohibits or restricts the effect of provision of the description mentioned in them.

S-9 Delegation by trustees.

9 Delegation by trustees.

(1) The trustees of land may, by power of attorney, delegate to any beneficiary or beneficiaries of full age and beneficially entitled to an interest in possession in land subject to the trust any of their functions as trustees which relate to the land

(2) Where trustees purport to delegate to a person by a power of attorney under subsection (1) functions relating to any land and another person in good faith deals with him in relation to the land, he shall be presumed in favour of that other person to have been a person to whom the functions could be delegated unless that other person has knowledge at the time of the transaction that he was not such a person.

And it shall be conclusively presumed in favour of any purchaser whose interest depends on the validity of that transaction that that other...

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