Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Friday, April 16, 2021

Article: Landmark Cases in Tracing: Re Tilley's Will Trusts (1967) and Turner v Jacob (2006)

Derek Whayman recently published an article entitled,  Landmark Cases in Tracing: Re Tilley's Will Trusts (1967) and Turner v Jacob (2006), Wills, Trusts, & Estates Law ejournal (2021). Provided below is the abstract to the Article: Estate planning

This is a sample chapter for a proposal, Landmark Cases in Tracing, made by Derek Whayman (Newcastle University) and Katy Barnett (Melbourne University).

The issue for the first instance judges in Re Tilley’s Will Trusts and Turner v Jacob was very simple: could a beneficial interest under a trust be traced into substitute property after being mixed with non-trust money where the trustee had not set out to use trust money and had not used it? The far more fundamental questions were not expressly considered in the judgments but are addressed in this paper. What is the basis of allowing access to substitute property? What is the basis of allowing access to any increase in value of that property? What is the basis of allowing priority in insolvency? Does the underlying cause of action matter to the process of identifying claimable value, i.e. to what extent is tracing, the process, divisible from tracing, the claim?

It is argued that the difficult fact patterns presented in these cases demands the following answers. The basis of allowing increases in value is a breach of fiduciary duty. To allow priority in insolvency what is required is a breach of trust. Consequently it therefore impossible to separate process and claim. Conversely, if one accepts the obiter dicta in the leading case of Foskett v McKeown, that tracing, the process, is separate to these matters of fault and tracing, the claim, is a right of property, injustices result. These apparently minor cases therefore have major ramifications for the law of tracing both in terms of its conceptualisation and practical application.

https://lawprofessors.typepad.com/trusts_estates_prof/2021/04/article-landmark-cases-in-tracing-re-tilleys-will-trusts-1967-and-turner-v-jacob-2006.html

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