• In the case of Hunter v Moss [1994] 1 WLR 452, one does not have to specify nor segregate the intangible assets, such as a proportion of shares, from the others for a trust to be validly created.

Facts of Hunter v Moss [1994] 1 WLR 452

  • The D was the registered holder of 950 shares in a company
  • He orally declared himself trustee of 5% (otherwise known as 50 shares) of the company’s share capital for the C
  • He disputed the finding by the trial judge that the oral declaration of trust was valid, on the ground of uncertainty as to the subject matter

Issues in Hunter v Moss [1994] 1 WLR 452

  • The D had not specified which 50 shares he would hold on trust for the C, would this mean the trust would fail?
  • The trust in Re London Wine Co [1986] failed as there was uncertainty as to the subject matter as the wines were not segregated, the shares here were not either, would that case apply here?

Held by the Court of Appeal

  • Appeal dismissed, it was not necessary to identify the particular 50 shares, segregation from the others was not required.

Lord Justice Dillon

Re London Wine Co did not apply here for the facts in the present case are easily distinguished

  • “that case is a long way from the present. It is concerned with the appropriation of chattels and when the property in chattels passes.” [458]

Lord Justice Dillon found that there was no issue of uncertainty in the present case:

  • “here the discussion is solely about the shares of one class in the one company” [457]
  • “Just as a person can give, by will, a specified number of his shares of a certain class in a certain company, so equally, in my judgment, he can declare himself trustee of 50 of his ordinary shares in M.E.L. or whatever the company may be and that is effective to give a beneficial proprietary interest to the beneficiary under the trust. No question of a blended fund thereafter arises and we are not in the field of equitable charge.” [459]

Editorial comment

Unlike in Re London Wine Co [1986], the present case concerned intangible assets which were essentially the exact same and thus did not have to be segregated. In the wine case, there were tangible assets which were required to be separated for the trust to be certain and therefore valid.

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