Equitable Assignment of Legal Property Where there is an equitable assignment the donor will hold the legal interest

t on trust for the donee. Questions about assignments o Is it a gift or was there valuable consideration? o What type of property is being assigned? o Is the interest in the property legal or equitable? o What are the requirements for assigning that interest in property at law and in equity? o What steps has the donor taken to assign the property? o Are those steps effective to complete the assignment at law or in equity? Valuable consideration must be more than nominal but need not reflect the full value (Corin v Patton) Equitable property o Interest of a beneficiary under a trust o Equitable mortgages o Rights under a partnership o Legatees right to an unadministered estate (chose in action) Livingstons case Chose in action - an intangible right enforceable only by taking legal action (debt). Property assignable in equity only o Equitable interests in property o Future property o Parts of a chose in action eg. Half of a debt. If all the steps for the assignment of legal property at law are not complied with equity may still regard the transfer as complete. For this to happen, in the case of a voluntary assignment, the assignor must have done EVERYTHING NECESSARY to transfer the property and render the settlement binding on himself. (Milroy v Lord) The meaning of Everything Necessary o In Corin v Paton the High Court adopted the view of Griffith CJ in Anning v Anning. o Under this construction, everything necessary means that the donor must take all the statutory steps that can only be taken by the donor personally. An assignment will be complete in equity if the remaining statutory steps can be taken by the assignee. In Corin v Paton, the High Court held that a gift of Torrens Title property would be beyond intervention and recall (and therefore be complete) if the donor delivered an executed memorandum of transfer and the certificate of title, or means of obtaining the certificate of title, to the donee. In Costin v Costin, the NSWCA held that merely giving the donee the means to obtain the certificate of title may not be sufficient to complete an equitable assignment of real property. Gifts must be beyond the recall of the donor (irrevocable).

Assignment of chose in action o At law a chose in action can be assigned by compliance with s12 Conveyancing Act o This requires A clear intention to assign An absolute assignment (all of the debt unconditionally) Writing Signed by the assignor Written Notice provided to the debtor (by assignor/assignee) o No need for consideration or a deed. o In equity a chose in action can be assigned if it is: Intentional Irrevocable Immediate (Norman v FCT) o The absence of notice will not defeat the assignment as this can be done by the donee (Comptroller of Stamps v Howard Smith) o An oral assignment of a legal chose in action will be effective in equity (Norman v FCT / Shepherd v FCT) o An equitable chose in action will be a subsisting equitable interest and under s23C(1)(c) of the Conveyancing Act writing would be required for a valid assignment in equity.

Assignments of Equitable Interests A valid voluntary assignment of equitable property usually requires o A clear expression of an intention to make an immediate disposition (Norman v FCT) o That the assignment be evidenced in writing, pursuant to the relevant section of the Conveyancing Act Questions to ask o What is the mode of dealing? o Is there evidence of a clear and immediate intention to dispose of the property in that way? o Can that form of assignment be done orally? Forms of dealing (Timpsons Executors v Yerbury) o A donor can assign property to the party directly o A donor can declare themselves a trustee of the interest for a third party o A donor can direct the trustees to hold the property on trust for a third party o A donor can contract for valuable consideration to assign the equitable interest. The steps taken must be those required for that particular form of dealing. Even if they would make another form of dealing valid they will not make the gift complete. (Milroy v Lord) The form of dealing will be determined by the actual intention of the donor.

The court will consider the text of the document and the document in the context of the surrounding circumstances (Comptroller of Stamps v Howard-Smith) Section 23C(1) Conveyancing Act o (a) and (c) must actually be in writing whereas (b) need only be manifested and proved by writing o A trust with respect to land only requires compliances with (b). In other words it needs to manifested and proved by writing and that writing can be made after the oral declaration of trust. (Department of Social Security v James) o (a) and (c) allow the writing to be done by an authorised agent. (b) does not allow an agent to do the writing. o (c) applies to both real and personal property (Adamson v Hayes) o (c) applies only to subsisting equitable interests in both personal and real property. It does not apply to the creation of an equitable interest for the purpose of disposition eg. a declaration of trust over personal property. o An oral declaration of trust over personal property would be valid (Grey v IRC) A revocable mandate is a form of authority to act. An interest cannot pass until the mandate is acted upon. If the mandate is acted upon then the assignment will be complete. But, if the mandate is revoked (expressly or by the death of the donor) before it is acted upon, the assignment will fail. Direct assignments occur where the donor attempts to immediately give their equitable interest in property to another. The necessary elements are the 3 EYEs o Intention o Immediate o Irrevocable (Norman v FCT) Writing will be required. (c) if personalty and (a) if real property. Notice will not be necessary. (Comptroller of Stamps v Howard-Smith) Parts of choses in action are assignable in equity where the 3 EYEs are present. There is no requirement of writing as it is not a subsisting equitable interest and therefore not caught by s23C(1)(c) A declaration of trust is constituted when the assignor declares that they retain their interest but now hold it on trust for the assignee (sometimes called a subtrust). Writing will be required as will the 3 EYEs. Notice will not be necessary.