When a settlor creates a trust, it isn't enough to intend one — they must make clear exactly what property is held on trust and what each beneficiary is to receive. This is certainty of subject matter, the second of the three certainties. As a solicitor drafting or reviewing trust documents, this is where careless wording does real damage: if the property or the shares can't be pinned down, the trust is void and everything results back to the settlor or their estate. Knowing where that line falls lets you draft trusts that hold and advise clients when an existing one is in trouble.
What this lesson covers:
- The Requirement — what certainty of subject matter means, where it sits among the three certainties, and what happens when it fails.
- Identifying the Trust Property — when a description of property is certain enough, and why vague terms like 'the bulk' fall down while 'residue' survives.
- Tangible v Intangible Fungible Assets — why a number of identical shares can be held on trust without segregation, but goods from a larger bulk cannot.
- Ascertaining the Beneficial Interests — how the shares each beneficiary takes are fixed, and what happens when a mechanism breaks down.
- Key Distinctions — the crucial contrasts between specified numbers and proportionate shares, and between fixed and discretionary trusts.