What is the difference between a constructive trust and a resulting trust?

Asked By: Marketa Cardanho | Last Updated: 23rd January, 2020
Category: business and finance bankruptcy
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A resulting trust is based upon the presumed intention that arises where a person provides funds for the purchase of property. A constructive trust is founded upon a common intention that can either be expressed or inferred but cannot be based upon an intention that the parties never in fact had.

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Also asked, what are resulting and constructive trusts?

Similarly, 'constructive trusts' are trusts that may exist even though an express trust has not been expressly created. A resulting trust arises essentially where property is transferred back to someone who is implied to have held the property on trust for the benefit of another.

Furthermore, what is a common intention constructive trust? A common intention constructive trust is based on the assertion that the parties had a common intention for assets to be held for their equal benefit, regardless of the legal ownership of those assets.

Likewise, people ask, how do you prove a constructive trust?

Generally, the court will consider whether the circumstances warrant the imposition of a constructive trust.

The three elements needed to prove common intention are:

  1. There must be a domestic relationship.
  2. There must be a common intention.
  3. The detriment caused to the plaintiff is a real detriment.

What is a resulting trust in equity?

Resulting trusts in English law are trusts created where property is not properly disposed of. Automatic resulting trusts arise from a "gap" in the equitable title of property. The equitable maxim "equity abhors a vacuum" is followed: it is against principle for a piece of property to have no owner.

31 Related Question Answers Found

What is the purpose of a constructive trust?

A constructive trust is an equitable remedy imposed by a court to benefit a party that has been wrongfully deprived of its rights due to either a person obtaining or holding a legal property right which they should not possess due to unjust enrichment or interference, or due to a breach of fiduciary duty, which is

What are the two forms of implied trust?

There are three types of implied trusts: statutory trusts, resulting trusts, and constructive trusts.
  • Statutory Trusts. A statutory trust arises when a statute, or law, creates a trust.
  • Resulting Trusts.
  • Constructive Trusts.

What is the point of a trust?

What Is a Trust? A trust is traditionally used for minimizing estate taxes and can offer other benefits as part of a well-crafted estate plan. A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries.

What are the duties and benefits of a trustee?

The trustee acts as the legal owner of trust assets, and is responsible for handling any of the assets held in trust, tax filings for the trust, and distributing the assets according to the terms of the trust. Both roles involve duties that are legally required.

What is a presumptive trust?


A presumption in trust, contract and family law which suggests that property transferred from a parent to a child, or spouse to spouse, is a gift and would defeat any presumption of a resulting trust.

How do trusts arise?

Presumed resulting trusts arise either from voluntary transfer of the legal estate or by contribution to the purchase price. In such circumstances a resulting trust arises and the transferor or the person making the contribution retains or takes a share in the beneficial interest.

What is an implied trust in land?

When co-ownership of a land is granted to a person whose name is not recorded as trustees or under the title, it is called as implied trust. This usually happens when someone buys the land or pays for improvement of the property, thereby acquiring an interest on it. Implied trusts are of two different types.

What are the three requirements of a constructive trust?

“The imposition of a constructive trust requires: (1) the existence of res (property or some interest in property); (2) the right of the complaining party to that res; and (3) some wrongful acquisition or detention of the res by another party who is not entitled to it.” See Burlesci v. Petersen, 68 Cal.

What is the difference between an institutional and a remedial constructive trust?

An institutional constructive trust arises upon the happening of the events which bring it into being. Its existence is not dependent on any order of the Court. A remedial constructive trust is one imposed by the Court as a remedy in circumstances where, before the order of the Court, no trust of any kind existed.

What are the fiduciary duties?


Fiduciary duty is a legal obligation of the highest degree for one party to act in the best interest of another. The party charged with the obligation is the fiduciary, or one entrusted with the care of property or money.

What does proprietary estoppel mean?

Proprietary estoppel is a means of creating a proprietary interest in land in the absence of following the correct formalities. The doctrine of proprietary estoppel can be used to create freehold ownership, a lease, a licence or an easement.

What is beneficial ownership of property?

Beneficial owner is a legal term where specific property rights ("use and title") in equity belong to a person even though legal title of the property belongs to another person.

What does unjust enrichment mean?

Unjust enrichment means when a person unfairly gets a benefit by chance, mistake or another's misfortune for which the one enriched has not paid or worked and morally and ethically should not keep. A person who has been unjustly enriched at the expense of another must legally return the unfairly kept money or benefits.

What is a constructive trust Canada?

Constructive trust. Related Content. A trust that arises by operation of law where it would be unconscionable for a person (A) who holds an asset to deny the beneficial interest of another person in the asset. For example, a constructive trust may arise where: A holds funds that he knows have been paid to him by

What is a bare trustee?


Bare Trustee Definition: The trustee of a bare trust; a trust that has been reduced to holding the trust property at the absolute disposal and benefit of the beneficiaries. Related Terms: Bare Trust.

Is constructive trust a cause of action in California?

Constructive trusts are authorized by case law and statute. California Civil Code section 2224 provides that a person who gains a thing by fraud, violation of a trust or other wrongful conduct is an involuntary trustee of it for the benefit of the person who would otherwise have had it. Civ. Code § 2224.

What is common intention?

In the legal terminology of property law, common intention is where there is an express or implied agreement between unmarried cohabitees as to their beneficial entitlements in the family home. The common intention constructive trust has been used by English courts to divide assets upon separation.