A trust is created intentionally by a person where he or she transfers legal title to a property and uses words that indicate that the transferee is to hold title for the benefit of the beneficiary. If a settlor clearly states that certain property is to be held on trust, then an express trust is created .Gill v Grant (1988) 30 ETR
A document stating that a person holds property in trust for another would be an example of an express trust.
It is well-established that for a trust to be created, there must be the three certainties, namely:
- Certainty of intention to create a trust;
- Certainty of the subject matter of the trust;
- Certainty of the beneficiaries or objects of the trust.
Typically in trust disputes there is no argument as to the applicable law, but only whether a trust is established on the facts of each situation.
However the caselaw recognizes that a trust is not always as clearly expressed as in a document and often the courts must examine behaviour and less technical words or expressions to determine when and if a trust was created.
Technical words or expressions are not necessary to create a trust- the test is ” there must be sufficient evidence of an intention on the payor’s part that the funds or property received by the trustee are not to become part of his own property but are to be or remain the property of the beneficiary. Bank of Montreal v BC Milk Marketing Board ( 1994) 94 BCLR (2d) 281 .
In Sutherland Estate v Nicoll estate (1944) SCR 253 at 263 the Supreme Court of Canada stated that the communication must be clear that the communication was made in circumstances in which an obligation was imposed upon and accepted by the trustee.