Melbourne Law School - Theses

Permanent URI for this collection

Search Results

Now showing 1 - 1 of 1
  • Item
    Thumbnail Image
    Proprietary Fixed Trusts and Administrative Discretionary Trusts: A Pluralist Account
    Barkley, Tobias John ( 2020)
    Express trusts are not all the same. They are found in different contexts, have different purposes and the rules of trust law do not apply uniformly to them all. Nevertheless, the cases and scholarship retain a strong commitment to a central unity in trust law. This commitment is the idea that trust law is unified by the unique legal form of a duty to hold assets for the benefit of others. However, the integrity of this unique form is challenged by the unrelenting rise in discretionary trusts. Discretionary trusts contain doctrinal differences that challenge the archetypal legal form and the conceptual monism at the heart of trust law. This challenge requires us to ask what it means for trustees to hold assets for the benefit of others and how that meaning has changed. The object of this thesis is to answer these questions using an interpretive analysis of the legal materials. This thesis argues that there are two distinct answers to what it means for trustees to hold assets for the benefit of others. It presents two distinct models of the legal form of the trust. Fixed trusts are explained by the traditional proprietary model of trusts, which is defined by beneficiaries’ distributive entitlements. Fixed beneficiaries are entitled to be distributed specific benefits from the trust assets and those entitlements are immune from divestment at the volitional choice of another person. In contrast, discretionary trusts fit an administrative model of trusts, which is defined by beneficiaries’ procedural entitlements. Discretionary beneficiaries are not entitled to distributions but are entitled to have trustees follow procedures in making decisions about distributions. The thesis argues that the distinction between these two trust models is well established in the case law. Moreover, the administrative discretionary trust model accounts for trustees with mere powers of appointment as well as trustees with imperative trust powers. However, the thesis argues that development of the administrative model remains incomplete because the law on discretionary beneficiaries’ procedural entitlements is inconsistent and uncertain. That is, the internal core of the administrative model — the rights and duties that regulate trustees’ distributive discretions — is incoherent and beset by numerous areas of uncertainty. This has produced a spectrum of different types of discretionary trust that range from low-accountability trusts, where the discretionary beneficiaries have weak procedural entitlements, to high-accountability trusts, where they have much stronger procedural entitlements. The lack of internal coherence in the administrative trust model can be traced back to deep disagreement about the meaning and purpose of discretionary trusts. This thesis argues that the future development of discretionary trusts may be usefully inspired by public administrative law. Public law can inform a purposive theory for the regulation of discretionary trusts that produces a more coherent administrative model than that promoted by the currently dominant contractarian theory.