In the realm of equity and trusts, the Three Certainties act as the essential pillars for creating a valid private express trust. If any of these pillars crumble, the trust fails. ​Crucially, as established in the landmark case of Vandervell v IRC [1967], if a trust fails for lack of certainty, the property does not simply become a gift to the trustee; instead, it "reverts" back to the settlor (the giver) via a Resulting Trust.

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Certainty Missing

Primary Consequence

Where does the money go?

Intention

No trust created

Stays with the recipient (as a gift).

Subject Matter

Trust is uncertain

Reverts to the Settlor.

Objects

Trust is void

Reverts to the Settlor via Resulting Trust.




    In the realm of equity and trusts, the Three Certainties act as the essential pillars for creating a valid private express trust. If any of these pillars crumble, the trust fails.

​Crucially, as established in the landmark case of Vandervell v IRC [1967], if a trust fails for lack of certainty, the property does not simply become a gift to the trustee; instead, it "reverts" back to the settlor (the giver) via a Resulting Trust.

​1. Certainty of Intention

​To create a trust, the settlor must manifest a clear intention to create a legal obligation, not just a moral one.

  • ​The Standard: The court looks at the substance of the words used. "Precatory words"—words expressing a hope or desire (e.g., "I give this to my wife in the confidence she will do the right thing")—usually fail to create a trust.
  • ​The Failure: If there is no clear intention to create a trust, the "trustee" (recipient) usually takes the property as an absolute gift. In this specific instance, the money stays with the recipient because no trust was ever successfully started.

​2. Certainty of Subject Matter

​This requires that the property itself and the beneficial interests within it are clearly defined.

  • ​The Standard: You cannot leave "the bulk of my estate" or "some of my shares" if they aren't specifically identified.
  • ​The Failure: If it is impossible to identify what property is supposed to be held in trust, the trust fails.
    • ​The Outcome: Because the court cannot even identify what the trust property is, it cannot be separated from the settlor’s estate. Therefore, it remains with (or reverts to) the settlor.

​3. Certainty of Objects

​The "objects" are the beneficiaries. A trust must have identifiable people (or a valid class of people) who can enforce it.

  • ​The Standard: For fixed trusts, you must be able to compile a "complete list" of beneficiaries. For discretionary trusts, you must be able to say with certainty whether any given individual "is or is not" a member of the class (McPhail v Doulton).

  • ​The Failure: If the beneficiaries are too vague (e.g., "my best friends"), the trust is void.

​The "Vandervell" Principle: Resulting Trusts

​The core of your inquiry rests on what happens when the intention to create a trust is clear, but the Objects or Subject Matter are poorly defined.

​In Vandervell v IRC, the House of Lords clarified the Automatic Resulting Trust:

  1. ​Equity Abhors a Vacuum: Equity does not like property to be "in the air." If a settlor successfully transfers legal title to a trustee but fails to effectively dispose of the "equitable interest" (the actual benefit of the money), that interest cannot just vanish.
  2. ​The Reversion: Because the trustee was never intended to own the money personally, they cannot keep it. Since the beneficiaries are unknown or the trust is void, the equitable interest "results" (springs back) to the settlor.

  1. ​The Trustee’s Role: The trustee holds the money on a "bare trust" for the settlor and must return it.

    2. ​Key Takeaway: Unless the settlor intended the transfer to be an outright gift, any failure in the certainties (specifically Subject or Object) means the trustee holds the funds for the settlor. The trustee is a mere vessel; they do not get to keep the "windfall."

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