Which Type of the Two Types of Resulting Trust Outlined

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The Answer is The type of resulting trust outlined in the statement you provided is known as an "automatic resulting trust." In Re Vandervell's Trusts (No 2), Megarry J distinguished between two types of resulting trusts: automatic resulting trusts and presumed resulting trusts.

An automatic resulting trust arises by operation of law when an express trust fails to dispose of the entire beneficial interest. This can happen when the trust instrument does not completely deal with all the equitable interests, or when the trust purposes fail. In such cases, the remaining equitable interest that has not been disposed of 'results' back to the settlor (or the settlor's estate if they have died) by default, without any need to demonstrate the settlor's intention regarding the non-disposed part of the equitable interest.

In contrast, a presumed resulting trust arises from a presumption of the settlor's intention. It typically occurs when property is transferred to another person, and it is presumed that the transferor did not intend to gift the beneficial interest, so the property is held in trust for the transferor. This presumption can be rebutted by evidence showing that a gift was indeed intended.

The statement you provided describes a situation where there is no evidence of the settlor's intentions regarding the non-disposed part of the equitable interest, which aligns with the concept of an automatic resulting trust, as the trust property automatically reverts to the settlor without the need to establish any presumed intention.

Which Type of the Two Types of Resulting Trust Outlined

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Which Type of the Two Types of Resulting Trust Outlined

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