Trusts of Land
1. Trusts in Land [as and from 1st December 2009]
2. Settlements [up to 30th November 2009]
4. Dealings with Settled Lands
5. Cesser of Limited Ownership
Introduction
Scope of Practice Direction:
This Practice Direction deals with Trusts of Land. The Land and Conveyancing Law Reform Act 2009 [S.I. 27 of 2009] [the 2009 Act] substantially amended the law in this area and therefore in this practice direction:
Section 1 deals with Land Registry practice in relation to Trusts in Land as and from the 1st December 2009 [the commencement date of the 2009 Act]
Sections 2 to 6 deal with Land Registry practice in relation to settlements and trusts and the law up to an including the 30th November 2009.
Section 7 deals with Land Registry Practice re trustees including Charitable trusts.
Glossary of Terms
- Life Estate – Not inheritable, it determines on the death of the holder.
- Estate Pur Autre Vie – Life estate that determines on the death of a person, other than the holder (To: A and the heirs of his/her body). Inheritable estate descending on the issue of the holder, i.e. to children or if deceased to grandchildren. If the estate is assigned, the assignee takes an estate pur autre vie. When this life estate determines, the issue of the original holder of the fee tail are entitled. A tail male was limited to the male issue of the holder. (To: A and the heirs male of his/her body).
- Base Fee – Created by disentailing assurance, where the fee tail holder fails to enlarge the fee tail into a fee simple because (1) s/he fails to obtain the consent of the protector of the settlement, (i.e. the life tenant in possession) or (2) fails to enrol the Deed within 6 months in Court. The estate is a fee simple, liable to determine on the failure of issue of the tenant in tail who executed the disentailing assurance.
- Fee Simple – The largest freehold estate, fully assignable and inheritable.
- Determinable Fee – (To: A in fee simple until etc). The grantor has a possibility of reverter. If the relevant event occurs, the estate determines and reverts to the grantor.
- Fee Simple Condition Subsequent – Similar to a determinable fee BUT what the grantor retains, in this case, is the right to re-enter the property for breach of condition. The estate does not determine unless and until the grantor re-enters for condition broken.
- Jointure – Annuity payable out of settled lands to the settlor’s spouse.
- Portion – Once off capital payment to children of settlor, not otherwise benefiting from the settlement.
- Dower – Right of widow to 1/3rd of husband’s inheritable realty. This is a burden under section 69 of the Registration of Title Act 1964, (No. 16.1964).
- Curtesy – Life estate of widower in all, his wife’s inheritable realty, provided issue have been born capable of inheriting.
1. Trusts in Land
1.1 Under section 11 of the 2009 Act the only legal estates capable of being created or disposed are a freehold estate and a leasehold estate.
All other estates or interests take effect as equitable interests only. Thus where a life estate is created in freehold land a trust will come into operation under Part 4 of the 2009 Act and the freehold estate will be held by the trustees. Any fee simple in remainder or reversion will be held under a trust and will be equitable interests only.
1.2 Under section 13 of the 2009 Act the creation of a fee tail of any kind at law or in equity is prohibited.
Any instrument entered into on or after the 1st December 2009 purporting to create a fee tail in a person vests in the said person a legal or equitable fee simple as the case may be. This is so even if a contract has been entered into prior to the commencement of the 2009 Act.
Where a person, before the commencement of the 2009 Act, was entitled to a fee tail at law or in equity, or after commencement, a person becomes entitled to such a fee tail, that person on commencement of the 2009 Act is entitled to a legal or equitable fee simple as the case may be [without the necessity of executing a disentailing assurance under the Fines and Recoveries (Ireland) Act 1834 which is repealed] provided any protectorship is ended.
A fee tail includes a base fee provided the protectorship has ended and a base fee created by failure to enrol the disentailing deed. It does not include the estate of a tenant in tail after possibility of issue extinct [where the issue to succeed have to be the children of a specified spouse and where that spouse predeceases the tenant in tail and they have no children] where the tenant in tail becomes a tenant for life and the reversionary or remainder estate takes effect on the death of the tenant in tail.
This largely reflects the situation prior to the 2009 Act except in the case of a base fee created by failure to enrol the disentailing deed where in effect the former tenant in tail becomes a life owner only. Such a fee simple will not be subject to any estates or interests limited by the instrument creating the fee tail to take affect after the termination of the fee tail but will be subject to any estates or interests limited to take effect in defeasance of the fee tail which would be valid if limited to take effect in defeasance of a fee simple [as in a determinable fee simple].
1.3 Section 18 of the 2009 Act establishes the new statutory model of a “trust of land”.
This covers all forms of trusts in land:
- “strict settlements” where land is settled directly on persons, by an instrument whenever created, without the use of a trust;
- where land is held on a trust whenever it arises and of whatever kind [express, implied, resulting, constructive, bare and trust for sale];
- where land vested before or after the 1st December 2009 in a minor.
The imposition of a trust in the case of (a) and (c) is a recognition of the practical realities. A tenant for life in (a) had the powers of dealing with land of a “tenant for life” including the power of sale and if the tenant for life sold the land the purchase money had be paid to the “trustees of the settlement” [section 22 of the Settled Land Act 1882]. In the case of a minor while the legal fee simple may have been vested in him/her absolutely s/he was deemed to be a tenant for life for the purposes of the Settled Land Act 1882 [section 59].
1.4 Section 19 of the 2009 Act sets out who are trustees of land in the case of each type of trust as set out in section 18:
(a) Strict settlement:
(i) where it exists before the 1st December 2009, the tenant for life within the meaning of the Settled Land Act 1882 together with any trustees of the settlement for the purposes of that Act
(ii) where it is purported to be created on or after the 1st December 2009 the person who would fall within paragraph (b) if the instrument creating it were deemed to be an instrument creating a trust of land
(b) Trust of land created expressly
(i) any trustee nominated by the trust instrument, but if there is no such person, then
(ii) any person on whom the trust instrument confers a present or future power of sale of the land, or power of consent to or approval of the exercise of such a power of sale, but, if there is no such person, then,
(iii) any person who, under either the trust instrument or the general law of trusts, has power to appoint a trustee of the land, but, if there is no such person, then,
(iv) the settler, or, in the case of a trust created by will, the testator’s personal representative of representatives.
(c) Minor In the case of land vested in a minor before the 1st December 2009 or purporting to so vest on or after the 1st December 2009, the persons who would fall within paragraph (b) if the instrument vesting the land were deemed to be an instrument creating a trust in land.
(d) Implied, resulting, constructive or bare Trust. The person in whom the legal title to the land is vested.
Section 19(3) of the Act confirms the current ultimate default provision of obtaining an order of the court appointing a trustee of land or vesting land in a person as trustee.
1.5 Application for registration where a trust in land exists lodged on or after the 1st December 2009 In any application for registration where a trust in land exists lodged on or after the 1st December 2009 the only registration that can be applied for is registration of the trustees as owners. The interest of a minor or a life interest are equitable interests only. Equitable interests are not registerable interests. It is open to the owner of an equitable interest to apply for the registration of an inhibition [See Practice Direction – Cautions and Inhibitions]. However where an application to register a life interest or a minor was lodged prior to the 1st December 2009 but settled on or after the 1st December 2009 registration of a life interest or of a minor can proceed [date of lodgement is date of settling Rule 58 Land Registration Rules 2012 [LR Rules 2012].
1.6 In any case where registration is effected under paragraph 1.4 above and the trust comes to an end In any case where registration is effected under paragraph 1.4 above and the trust comes to an end [e.g. life interests come to an end or the minor comes of age] the trustees will have to transfer the property to the relevant person.
1.7 Application in relation to a fee tail Any application in relation to a fee tail [see paragraph 1.2 above] whether to register same or to convert a current registration of a limited owner [fee tail] into the owner of the fee simple should be referred to the Divisional Manager.
1.8 Where a limited owner [tenant for life] is registered prior to the 1st December 2009:
(i) It is open to the trustees of the trust in land to apply [see Section 20 of the 2009 Act and Rule 66 of the LR Rules 2012 and Form 86] to be registered as full owners. Note in the case of a transmission Form 86 should not be used. Form 37 or Form 39 should be used – see Practice Direction – Devolution and Transmission.
(ii) If a registered limited owner dies [tenant for life] prior to the 1st December 2009 Rule 93 and Forms 45 and 46 apply [see Part 5 below].
(iii) If a registered limited owner dies on or after the 1st December 2009 [commencement date of this section] and where the remainderman is entitled to the legal estate [no intermediate interests] the trust will be regarded as having ended and remainderman regarded as being entitled in fee simple in possession. Form 45 or 46 should be lodged.
Subject to there being no intermediate interests, what is set out above also applies where the estate or interest of the limited owner is determined otherwise than on death. This usually occurs on merger of the life estate in the remainder estate, by surrender or transfer by the limited owner of his/her estate to the remainderman. In such cases Form 45 or 46, with paragraph no. 1 adapted, should be lodged together with the Deed of Transfer/Surrender.
If a minor who is registered as owner:
(iv) reaches his/her majority prior to the commencement date, treat as we do now, i.e. description of minor/infant can be removed on lodgement of proof of age.
(v) reaches his/her majority on or after the 1st December 2009 [commencement date of this section] the trust will be regarded as having ended and the minor regarded as being entitled in fee simple in possession. We will delete the description “minor” or “infant” on proof of age.
1.9 Limited owner [tenant for life] is registered prior to the 1st December 2009 Where a limited owner [tenant for life] is registered prior to the 1st December 2009 it is no longer open to him/her [on or after the 1st December 2009] to exercise a power of sale or for the limited owner and the remainderman to transfer the legal title to a third party or to deal with the property in any way [see Part 4 below]. The legal estate vests in the trustees and they are the appropriate party to deal with the property.
2. Settlements
This section deals with the law up to and including the 30th November 2009. The main Acts governing this area are the Settled Land Acts 1882 to 1890.
2.1 Settlement
A settlement was defined as any instrument, or number of instruments, whereby any land or estate or interest in land stood limited to or in trust for any persons by way of succession. Therefore, a settlement existed whether it was the legal estate, or the equitable estate, that was limited by way of succession. [See Section 2(1) of the Settled Land Act 1882].
The life tenant was, generally, the person holding for the duration of his own life or the life of another. Prior to the repeal of Section 99 of the Registration of Title Act 1964, such person in possession was entitled to be registered as limited owner and was vested with the powers of a life tenant under the Settled Land Acts.
The following persons were listed in section 58 of the Settled Land Act 1882 as life tenants. Any such persons, whose estate or interest had vested in possession, were entitled to be registered as limited owner.
1. Person holding for his own life or the life of another
2. Tenants in fee tail
3. Tenants of base fee
4. Tenants of determinable fee simples with executory gift or disposition over
5. Tenant by curtesy
6. Person entitled to the income of land under a trust during his own or another’s life.
7. A tenant for life (his own or another’s) whose estate was liable to cease on the happening of any event during that life.
The Settled Land Act 1882 contained a number of provisions prohibiting any curtailment or hampering of the powers of the life tenant. Such powers included dealing with the settled lands. Therefore, where there was a person, who was deemed to be life tenant under the Settled Land Acts, that person was registered as limited owner.
2.2 Creation of Settlement
Generally a settlement was created by Deed of Transfer or by Will. However, an owner of freehold could not, under Common Law rules, cut short his/her own estate or interest nor could s/he transfer directly to himself/herself. In those circumstances, it would not be possible for the fee simple owner to transfer property to himself/herself for life, with remainder to another. This difficulty was overcome by the fee simple owner transferring to a third party “to the use” of himself/herself for life and after his death to the use of the person entitled in remainder. The Statute of Uses (Ireland) 1634 executed the “use” and by-passed the Common Law to vest a legal life estate in the transferor. The effect of the Statute of Uses and its limitations are dealt with fully in Chapter 3 of Wylie on Irish Land Law.
The Statute of Uses was repealed by the 2009 Act.
2.3 Burdens under Settlements
Burdens, which were created under a settlement may have been created as ranking in priority to the trusts of the settlement, affecting life estate only or affecting the remainder interest.
On an application for registration, by way of succession to a limited owner, it must be ascertained whether any of the burdens already entered as affecting the estate of the limited owner, affect the applicant’s estate and whether there are any other burdens, under the settlement, affecting the remainder estate. If so, such burdens must be entered in the register. The consent of the applicant(s) is necessary.
2.4 Trustees of the Settlement for the purposes of Settled Land Acts 1882 to 1890.
The following persons in the following priority were such trustees:
1. Trustees under a Settlement with power of sale
2. Persons declared Trustees for purposes of Settled Land Acts l882 to 1890
3. Trustees with power of sale under a trust for sale of land subject to same limitations as land in question
4. Trustees with future power of sale or future trust for sale or power to consent to such future sale. (Section 2(8) of 1882 Act and section 16 of 1890 Act refer.)
5. If none of the foregoing, then trustees appointed by the Court.
Powers and Duties of Trustees of the Settlement:
1. To exercise powers of life tenant on behalf of an infant (minor) life tenant where life tenant is dealing with the settled land
2. To receive a months notice of life tenants exercise of statutory power
3. To receipt capital monies. The Settled Land Act Trustees invest capital sums in authorised trust investments and the trusts of settlement then attach to these investments.
Section 39 of the Settled Land Act 1882 required, that capital money be paid to at least TWO Trustees of the Settlement, unless the settlement authorised payment of capital to a sole trustee.
2.5 Infant’s Property
General
Prior to the coming into operation of the Age of Majority Act, 1985, on 1st March 1985, a person under 21 years of age was an infant. The Age of Majority Act, 1985 reduced the age of majority to 18 years and provided that a person under 18 years of age may be referred to as a minor.
The property of an infant/minor full owner was deemed to be settled lands, by virtue of section 59 of the Settled Land Act 1882. An effective transfer of lands, held by an infant/minor registered full owner, could be made only by persons, appointed by the Court as Settled Land Act Trustees, pursuant to section 60 of the Settled Land Act 1882. The aforementioned trustees exercised the powers of a life tenant, on behalf of the infant/minor owner. Although the land was deemed to be settled and the infant was deemed to be a tenant for life, for the purposes of section 59 of the 1882 Act, there was no instrument in existence, which could have been defined as a settlement. Therefore, the Court was the only body with power to appoint such trustees. In such cases, the purchase money realised on a sale of the lands, on behalf of an infant/minor full owner, was paid into Court. The cases Re Dudley [1887] 35 Ch 338; Re Greenville Estates 11 Law Reports Ireland 138 and Re Goswells Trusts [1915] 2 Ch 106 refer. (See Instrument C2574/83.)
Where land was held in settlement and the limited owner in possession was an infant/minor, then the trustees of the settlement for the purposes of the Settled Land Acts 1882 to 1890, could exercise the powers of a life tenant on behalf of the infant/minor limited owner.
The provisions of section 57 of the Succession Act 1965 [No. 27 of 1965], section 101 of the Registration of Title Act, 1964 [No.16 of 1964] and Rule 148 of the Land Registration Rules 2012 [S.I. No. 483 of 2012] refer.
2.6 Joint Owners
If property was transferred “to A.B. and C.D. during their joint lives and then to the survivor of them”, they were registered as joint limited owners.
2.7 Powers of the Life Tenant
To over-reach the trusts of the settlement by sale, certain mortgages and certain limited types of leases. (See below on Dealings with settled lands). Sections 6 of Settled Land Act 1882 and Section 79 of Landlord and Tenant Act, 1980 refer.
2.8 Future Interests
What follows is a very brief outline of a difficult and technical topic. Chapter 5 in Wylie on Irish Land Law, or some other suitable text, should be consulted for a full treatment of this area.
Where a grantor failed to dispose of his entire interest, what remained vested in him/her by operation of law, on determination of the prior vested interest, was a reversion. If the future interest was vested or limited to vest in someone other than the grantor, it was a remainder. Remainders were either vested or contingent.
Vested Remainders – Where holder was entitled to current enjoyment of the land, his estate was vested in possession. Where he had a present right to a future enjoyment, his estate was vested in interest only.
Contingent Remainders – These arose where:
1. Holder not yet ascertained and/or
2. The interest cannot take effect immediately upon determination of prior estate.
Common Law Remainder Rules
These, especially (i) and (ii) below, were based on the doctrine of “no gap in seisin”, i.e. they prevented shifting and springing estates. They also only applied to freehold interests. The Common Law held void a remainder which did not comply with all of the following:
(i) Remainder must be supported by prior freehold estate. (ii) Remainder must not cut short prior freehold estate. (iii) No Remainder after a fee simple. (iv) Remainder must vest during (viz. interest) or immediately upon determination (viz. possession) of prior freehold estate.
Statute of Uses
Statute Law prevailed over Common Law and so, to some extent, Common Law Remainder Rules could be avoided by legal executory limitations. These were shifting or springing uses executed under the Statute of Uses as legal interests.
For example, in the limitation “to B for 20 years with remainder to C in fee simple provided C is married”, the remainder to “C” is void under Common Law Remainder Rule (1) if C is unmarried, as B’s estate is not a freehold that can support the contingent remainder. If C is married, his estate is vested in interest and so his remainder is valid.
If limitation had read “To A in fee simple to the use of B for 20 years remainder to the use of C in fee simple provided C is married”, it would be valid as a springing use.
In the limitation “to B for life, but if B marries C then to D in fee simple” -D’s interest is void under Common Law Remainder Rule (2) as a shifting interest, that may cut short B’s life estate. However, if the conveyance read “to A in fee simple to the use of B for life but if B marries C then to the use of D in fee simple”, this is valid as shifting use.
Note (1): Statute of Uses only applied to conveyances/transfers between living persons. However, the Courts interpreted Wills more liberally than Deeds. Therefore, a springing or shifting devise is valid.
Note (2): The holder of a determinable fee simple, with a valid shifting or springing use that operates as a gift over, had the powers of a life tenant under the Settled Land Acts and would have been registered as limited owner.
The Statute of Uses has been repealed by the 2009 Act.
3. Rules against Remoteness
This section deals with the law up to and including the 30th November 2009.
These were attempts by the law to balance the rights of landowners to control future ownership of their property with public policy, which requires all owners should be free to deal with their property.
3.1 Rule against Restraints on Alienation
Any covenant or condition in a Deed of Transfer, which places a total restraint on future dispositions or alienation of the property by the transferee, is void. Such a covenant or condition is repugnant to the estate granted.
A partial restraint on alienation is void if it offends public policy. This is generally a matter for the Courts to decide. The most usual type of partial restraint, which has been seen in the Registry, is a provision in a Deed of Transfer that the transferee is required to pay over a portion of the proceeds of any future sale made during the lives of the transferors or other children of the transferors. There may also be an application to register a charge to secure such payment. In such cases, the following letter should be sent to the lodging solicitors:
“In view of the law as stated in Byrne v Byrne 87 I.L.T.R. 183, the proposed registration of a charge for €x in the event of a sale during the lifetime of [transferor or as case may be] amounts to a restraint on alienation and is void. We are prepared to proceed with registration of the transfer free from the charge. If this is not acceptable, we will consider formally refusing registration, whereupon an appeal may be made to the Court under section 19(1) of the Registration of Title Act 1964.”
The letter may be adapted to suit the particular case. Sometimes, instead of registration of a charge being sought, a caution or inhibition is sought to protect what appears to be a restraint on alienation. The matter is fully discussed in Instrument J83/74.
Note (1): The rule against restraints on alienation does not apply to gifts to charities.
Note (2): Section 9(4) of the 2009 Act provides “a fee simple remains freely alienable”, therefore the above provisions also apply on or after the 1st December 2009.
3.2 Rule in Whitby V. Mitchell
The rule, which appears to be an old Common Law rule that was restated in the above case, is now generally referred to as the Rule in Whitby V. Mitchell. The rule stated that where an interest in land is granted to an unborn person, any remainder over to the issue of that person and any subsequent limitations are void.
This Rule was abolished by Section 16 of the 2009 Act.
3.3 Rule against Perpetuities
This Rule may be stated thus: “If any interest is to vest it must vest during a life or lives in being or within 21 years thereafter”. A gestation period was also allowed for. However, there was no wait and see element. If there was any possibility that an interest would vest outside the period, it was void under the Rule. Lives in being were generally persons connected with the disposition or sometimes lives named in the disposition. Vesting, for the purposes of this rule, refers to vesting in interest.
This Rule was abolished by Section 16 of the 2009 Act.
4. Dealings with Settled Lands.
This section deals with the law up to and including the 30th November 2009.
4.1 Transfer by a limited owner of his/her limited estate:
When a registered limited owner transferred the limited estate to a person, who was not entitled to be registered as full owner in remainder, the transferee was registered as follows:
“A.B. is assignee of the estate of the limited owner”.
The limited ownership was not cancelled. The powers of the life tenant were not assignable although the limited estate was.
4.2 Transfer by person entitled in remainder of his/her remainder estate to a stranger
Where a person entitled in remainder transferred his/her remainder estate to a stranger, the registration effected was an inhibition as follows:
“No registration of ownership under the settlement is to be made after the determination of the interest of the registered limited owner except with the consent of ………”.
4.3 Leases by Limited Owner:
The limited owner had restricted powers of leasing settled lands, e.g. 99 years for building lease or 35 years for other leases. Section 6 of the Settled Land Act 1882 refers.
4.4 Easements:
Any easements, which are pre-existing as appurtenant or subject rights over the settled lands, will be dealt with in the normal way in a sale or exchange.
5. Cesser of Limited Ownership
This section deals with the law up to and including the 30th November 2009.
5.1 Application by person entitled in remainder or reversion:
An application by a person, entitled in remainder or reversion, after the life estate of the registered owner has determined prior to 1st December 2009, provided there are no other intermediate estates or interests, should be grounded on affidavit in Form 45 or 46 of the Land Registration Rules 2012. Form 45 is used where the limited owner was registered on foot of a post 1959 transmission. In all other cases, Form 46 should be lodged.
See paragraph 1.8 above in relation to the death of a registered limited owner on or after the 1st December 2009.
5.2 Fee Tail:
The owner of a fee tail estate had the powers of a tenant for life, under the Settled Land Acts, and would have been registered as a limited owner if s/he held that interest in possession. Fee tail is defined in the glossary. In the event that the fee tail is a remainder estate, coming after a prior life estate, the owner of the life estate is known as the protector of the settlement.
Prior to 1st December 2009, a person holding or entitled to a fee tail could enlarge that estate into a fee simple. A Disentailing Deed was required. For registered lands, the fee tail should have been transferred in fee simple to a nominal trustee to the use of the fee tail owner. In this case, notwithstanding section 123 of the Registration of Title Act, 1964 [No.16 of 1964], the words of limitation, “in fee simple” were necessary. The consent of the protector of the settlement was required and the Deed must have been enrolled in the High Court, prior to lodgement for registration. An example of such a Deed is filed on Instrument W2666/75. If any of the formalities are not followed, the fee tail was enlarged into a base fee, which was a lesser estate than the fee simple.
This topic is fully dealt with by Wylie on Irish Land Law and in other leading texts.
Section 13 of the 2009 Act abolished the creation a fee tail from the commencement date of 1st December 2009. Provided the “proctorship” has ended, any fee tail subsisting on the commencement date is enlarged into a fee simple. Any applications by a limited owner, claiming to hold in fee tail, for enlargement, should be referred to the Divisional Manager.
6. Trusts for Sale
A trust for sale should be distinguished from a power of sale. In the case of a trust for sale, the trustees are obliged to sell the property, with discretion only to postpone the sale. The legal estate is vested in the trustees. In the case of a power for sale, the trustees have discretion whether to sell or to hold the property. Prior to 1st December 2009, if there was a beneficiary, who has the statutory powers of a life tenant, that person was registered as limited owner. In such circumstances, the legal interest vested in such registered limited owner and not the trustees.
The object of a strict settlement was to keep land in the family by tying it up in unmarketable successive estates. This object was largely defeated by the Settled Land Acts giving the life tenant power to dispose of a marketable title. On the other hand, trusts for sale were designed to ensure lands were sold. However, section 63 of the Settled Land Act defeated the object of trusts for sale. This deemed land subject to a trust for sale to be settled land; deemed the Deed or Instrument creating the trust to be a settlement; deemed the person entitled to the income as tenant for life; and deemed the trustees to be Settled Land Act trustees. The net effect of this was to divest trustees of their power to deal with the lands and transfer those powers to persons deemed life tenants.
Sections 6 and 7 of the Settled Land Act 1884 attempted to amend this position. The effects of those sections were that trustees could exercise their powers, provided no Court Order under the 1884 Act had been obtained by the person deemed tenant for life and registered as a lis pendens in Judgments Office. In the case of registered land, it was not necessary to register the order as a lis pendens but the order should have directed that the person, who had the powers of tenant for life, be registered as limited owner.
Form 29 and Rule 69 of the Land Registration Rules 2012 [S.I. No. 483 of 2012] should be noted.
7. Trustees
With regard to Trusts, the main areas dealt with are:
- Appointment of trustees
- Charitable trusts
The main Acts governing this area are the Trustee Act 1893 [Note Trust Law: General Proposals (LRC 92-2008) which includes a Draft Trustee Bill 2008] and Charities Act, 1961 [No.17 of 1961] Charities Act, 1973 [No.13 of 1973] and Charities Act 2009 (No. 6 of 2009).
Section 92 of the Registration of Title Act, 1964 [No.16 of 1964] and Form 77 of the Land Registration Rules 2012 [S.I. No. 483 of 2012] should be noted.
7.1 General
In general, trusts are kept off the register. See section 92 and section 123(3) of the Registration of Title Act, 1964 [No.16 of 1964]. The legal estate is vested in the trustees and these are registered as owners, usually joint tenants.
It will be noted from Rule 64 and Rule 69 of the Land Registration Rules 2012 [SI. No. 483 of 2012] that where a transfer is made to trustees, it is a matter for the transferees to have entered in the register an inhibition to protect the trusts on which they hold. There is no obligation on the Authority to insist on the entry of such an inhibition but the lodging solicitor should be referred to Rule 64 or 69 as the case may require.
The classification of trusts is dealt with in Chapter 9 of Wylie on Irish Land Law and in other leading texts. Original trustees are appointed by the person or persons creating the trust. Replacement trustees may be appointed by the person or persons having power of appointment. In addition, the following should be noted:
7.2 Section 10 of Trustee Act 1893
The surviving trustee(s), or the personal representative of the last surviving trustee, may appoint new trustees. In the case of registered land, this appointment must be effected by Deed of Transfer. Section 12(3) of Trustee Act, 1893, is considered wide enough to exclude registered land, (which is transferable in a prescribed statutory form), from the form of vesting permitted elsewhere in section 12.
Section 10 of Trustee Act, 1893, allows for appointment of new trustees to replace any trustee unfit or unwilling to act or who has remained outside the jurisdiction for more than 12 months. Such a trustee, although one of the joint registered owners, need not join in the Deed of Transfer appointing his replacement. See correspondence filed on Instrument W255/85.
A Deed of Transfer, appointing new trustees, or transferring property out of a trust to the beneficiaries, does not require a Particulars Delivered stamp or revenue stamping.
7.3 Replacement of Trustees of Scheme under sections 4 and 20 of Irish Land Act 1903, Section 18 of Land Act 1909 and section 30 of Land Act 1957
Section 7 of the Land Act 2005 facilitates trustees in the transfer to users of former Land Commission trust property, by providing the Minister for Agriculture Food and the Marine with the power to arrange for the transfer of title of the entire or a part of a trust property when so requested by the trustees, relieving them of the legal and financial burden involved. At present the Minister for Agriculture Food and the Marine may consent to a proposal from the trustees that they transfer the entire or a part of a trust property and the legal work necessary to effect a change of ownership in the Land Registry Office is the responsibility of the trustees.
Section 30 of the Land Act, 1950 (amending sections 4 and 20 of the Irish Land Act, 1903) provides for the framing of schemes for the user of land by trustees (e.g. G.A.A. trustees). Schemes may be brought to an end and the property disposed of by the trustees with the consent/authorisation of the Minister for Agriculture Food and the Marine under section 30(7)(f) or 30(9)(a) of the Land Act, 1950.
Such applications may be registered on receipt of the following:
1. Form 17
2. Deed of Transfer by registered owners
3. No stamp duty or registration fees are payable – section 30(19) of the Land Act, 1950.
4. If the transferors are not the registered owners a Warrant of Appointment under section 30 of the Land Act, 1950 appointing new trustees is required.
5. If the disposal is under section 30(7)(f) the original consent of the Minister is required.
If the disposal is under section 30(9)(a), by Delegation Authorisation of the Minister any Principal Officer of the Minister may exercise this power. The original consent of such Principal Officer should be on headed paper and should recite that the consent is exercised under Delegation Authorisation of the Minister.
7.4 Charitable Trusts
General:
The Charities Act, 1961 [No. 17 of 1961], Charities Act, 1973 [No.13 of 1973] and Charities Act 2009 [No. 6 of 2009] govern charitable trusts and trustees. Sections 1, 2, 5, 10 (other than 10(3) and 10(4)) and Section 99 of the 2009 Act were commenced on 1st September 2009 by S.I. No. 284 of 2009. Sections 4 and 90 were commenced on 26th June 2010 by S.I. No. 315 of 2010.
Under the Charities Act 2009 (Commencement) Order 2014 (S.I. 457 of 2014), the remainder of Part 1, together with Parts 2, 3, 5 and 6 and Schedules 1 and 2 of the Charities Act 2009 commenced on 16th October 2014. The Charities Regulatory Authority was also established, in place of the Commissioners of Charitable Donations and Bequests for Ireland, on 16th October 2014, by virtue of the Charities Act 2009 (Establishment Day) Order 2014 (S.I. 456 of 2014)
Section 13 and Schedule 1 of the 2009 Act provide, inter alia, that the Charities Regulatory Authority shall be a body corporate with perpetual succession and an official seal and shall have power to sue, and may be sued, in its corporate name.
Section 82 of the 2009 Act provides that all functions, which immediately before the establishment day were vested in the Commissioners, are transferred to the Charities Regulatory Authority. References in any enactment or statutory instrument to the Commissioners of Charitable Donations and Bequests for Ireland shall be construed as references to the Charities Regulatory Authority.
On the registration of ownership, in which the fact that the applicants hold the property on a charitable trust is disclosed, the lodging solicitors should be asked, if the entry of an inhibition in accordance with Rules 64 and 69 of the Land Registration Rules, 2012 [S.I. No. 483 of 2012], is required unless the applicant is an incorporated body. The inhibition should be one restricting dealings by the registered owners without prior notice to the Secretary or person in administrative control of the educational, diocesan, parochial or other charitable objects of the organisation for which the property is held. No trust is in any case to be presumed by reason merely of the owners being described as clergy or as being members of religious orders.
Appointment of new trustees of property held on charitable trusts:
General:
Primarily new trustees of all property held on trust may be appointed by the persons nominated to appoint such trustees in the instrument creating the trust. Various statutes give powers in certain circumstances to other persons to appoint trustees. Section 10 of the Trustees Act, 1893, provides the machinery for the appointment of new trustees most widely used and this section is available for the appointment of trustees for Charitable Trusts.
1850 Act:
Under section 3 of the Trustee Appointment Act, 1850, as amended by the Trustees Appointment Act 1890, the congregation or society may appoint new trustees of the charitable trust, provided the trust is for one of the following purposes:
1. Church or other place of religious worship.
2. Residence for a clergyman or caretaker of a church or other place of religious worship.
3. Schoolhouse, playground, teacher’s or caretaker’s house.
4. College academy or seminary with or without grounds.
5. Parochial Hall.
6. Burial Ground.
The method of exercise of this power is by Deed of Memorandum and Choice of Appointment as shown below. The appointment under a “Memorandum and choice of appointment” is not completed until six months after the date of such memorandum. (See section 6 of Act of 1890.)
MEMORANDUM of the choice and appointment of new trustees of the …………. situate in the parish of ………, in the county of ……………, at a meeting duly convened and held for that purpose on the ……….. day of ………… 19…..,A.B. of ……….., chairman.
Names and descriptions of all the trustees on the constitution or last appointment of trustees, made the ……… day of
-C. D. etc. (Names and descriptions of all the trustees in whom the said …………………. and premises now becomes legally vested)
First – Old continuing trustees
– E. F etc.
Second – New trustees now chosen and appointed:
– G. H etc.
Dated this ………….. day of
Signed, sealed, and delivered by the said A B ……………, as chairman of the said meeting, at and in the presence of the said meeting, on the day and year aforesaid, in the presence of …………………
[2 witnesses]
Charities Act 1973: Appointment of Trustees
Section 14 of the Charities Act, 1973 [No.13 of 1973], gives the Charities Regulatory Authority, (previously the Commissioners of Charitable Donations and Bequests for Ireland), power to appoint trustees for any charity and by order to vest the property of such charity in such trustees for such estate as the order directs. On lodgement of a copy order under the seal of the Charities Regulatory Authority and payment of the prescribed fees, the person or persons in whom the land is vested are to be registered as owner(s). If the property of the charity being vested is a charge, the lodgement of the copy order has a like effect taking into account the nature of the ownership of a charge.
It is to be noted that the powers of a trustee appointed under this Section are retrospective as if s/he had been appointed by the instrument creating the trust.
Establishment of Trustees as body corporate
The Charities Regulatory Authority is given power under section 2 and section 3 of the Charities Act, 1973 [No.13 of 1973], to frame a scheme, under its seal, establishing the trustees of a charity as a body corporate and vesting the property of the charity in that body. The date of vesting is the “operative date”, that is, the date specified in the order as that on which the scheme is to come into operation.
The Land Registry is required by section 3 (2) of the Charities Act, 1973 [No.13 of 1973], to register the Body Corporate as owner in the appropriate register on production of a copy of the Scheme under the seal of the Charities Regulatory Authority and on payment of the prescribed fees.
The following practice should be followed:
1. Where the trustees who made application for the framing of the scheme are the registered full owners of the property in question, the body corporate established by the Scheme should be registered as full owner of the property, on production of a copy of the scheme under the seal of the Charities Regulatory Authority. The date of the registration is the “operative date” (as explained above).
2. In any other case it must be shown that the Folio lands are the property of the Charity. The Divisional Manager should be consulted in cases of doubt.
Sale of property held on charitable trusts:
Any “disposition” of registered land within the meaning of section 11 of the Charities Act, 1973, without the consent of the Charities Regulatory Authority is voidable only. The Charities Regulatory Authority can authorise with retrospective effect any disposal of land by sale, exchange or surrender of a lease.
Accordingly, on a sale by the registered owner without the consent of the Charities Regulatory Authority, registration is to proceed without inquiry.
Disposition of property of charity by two-thirds majority of the trustees:
Section 55 of the Charities Act, 1961 [No.17 of 1961] provides that a two thirds majority of the trustees of a charity, assembled at a meeting of their body duly constituted, have power to execute all deeds and documents and do all acts necessary to carry into legal effect any disposition of the trust property.
Where charitable trustees are registered as owners of property and a disposition of such property is lodged, executed by some only of such registered owners purporting to act in accordance with section 55 aforesaid, the dealing is to be referred to one of the Deputy Registrars.
School Leases
Leases of National Schools, created pursuant to the Leases for Schools (Ireland) Act, 1881, may grant to the Minister for Education and Skills the power to appoint new or replacement trustees. If such Deed of Appointment is lodged, the Lease should be examined for evidence of the power to appoint. Subject to that, registration should proceed. Note the 1881 Act was repealed by the Land and Conveyancing Law Reform Act 2009 as of the 1st December 2009.
The Charities Regulatory Authority may make a vesting order in relation to land comprised either in a school lease, or in any other lease made for a charitable purpose, pursuant to section 6 of the Charities Act, 1973 [No.13 of 1973].
Failure of Charitable Gifts
Under section 16 of the Charitable Donations and Bequests (Ireland) Act, 1844 (7 & 8 Vic. c. 97), gifts to charities failed on the death of the donor, within 3 months of the date of the relevant Deed or Will and, in the case of a Deed, the gift failed if the Deed was not registered in the Registry of Deeds, within 3 months of execution. These provisions no longer apply as the 1961 Act repealed the 1844 Act in full. A charitable gift whether given by Deed or Will is now in the same position as any other gift.
Charges for the maintenance or improvement of graves and memorials
Section 50 of the Charities Act, 1961 [No.17 of 1961] provides that gifts for the provision, maintenance or improvement of graves and memorials are now charitable, up to £60 (€76.18) per year in the case of a gift of income or £1,000 (€1,269.74) in any other case. Such a gift may now therefore be enforced and if such a gift is charged on registered property it may be registered as a charge.
Property Registration Authority
01 December 2009
Updated 22 January 2015
Settlements and Trusts Charts
Settlements and Trusts Charts prior 1st December 2009:
Settlements and Trusts Charts post 1st December 2009: