SQE1 certainty of trusts: what you must know and how it is tested

SQE1 certainty of trusts questions test the three certainties an express trust needs: intention, subject matter and objects. If any one is missing, the trust fails, and the effect depends on which one. Read it with the wider Trusts Law guide.

SubjectTrusts Law (FLK2)

Key lawKnight v Knight; McPhail v Doulton

Question typeSingle best answer, five options

The rules to apply

Certainty of intention. The settlor must show an intention to create a trust, not a hope or wish. No special words are needed, but precatory words such as 'in the confidence that' or 'I hope' usually create no trust (Re Adams and Kensington Vestry; contrast Comiskey v Bowring-Hanbury). The court looks at the whole document and the surrounding circumstances. A label does not decide the matter (Paul v Constance shows intention can be inferred from conduct). If intention is missing, the gift is usually absolute.

Certainty of subject matter. Both the trust property and each beneficiary's share must be identified. 'The bulk of my estate' is too uncertain (Palmer v Simmonds). A trust of a stated number of shares in a company, out of a larger holding of identical shares, was upheld in Hunter v Moss, but a trust of part of a stock of wine that is not separated failed in Re London Wine. Where the beneficial shares are not identified, as in Boyce v Boyce (two houses, one daughter to choose first), the trust fails. If the property is uncertain, the trust fails.

Certainty of objects. For a fixed trust, the complete list test applies: it must be possible to list all the beneficiaries (IRC v Broadway Cottages). For a discretionary trust, the is-or-is-not test applies: can it be said with certainty whether any given person is or is not a member of the class (McPhail v Doulton; Re Gulbenkian)? The class must be conceptually certain, such as 'employees', rather than vague, such as 'friends'. The trust must be administratively workable and not capricious. If the objects are uncertain the trust fails and the property returns to the settlor on a resulting trust.

Formalities and constitution are separate: a declaration of trust of land must be evidenced in writing signed by the settlor (s53(1)(b) LPA 1925), a disposition of an existing equitable interest must be in writing (s53(1)(c)), and a trust must be properly constituted (Milroy v Lord) by transfer of the property to the trustee or by a declaration.

Traps examiners use

Treating a wish as a trust.
Using the is-or-is-not test for a fixed trust.
Treating 'friends' as certain for the complete list test.
Forgetting that failure of the objects leads to a resulting trust.
Confusing the certainties with formalities and constitution.
Missing that uncertainty of shares can defeat the whole trust.

Worked question 1

Ravi gives his brother £50,000 with the words: 'I am confident you will use this to look after my children.' Is a trust of the money created?

A. Yes, because the words show a clear intention to create a trust.
B. No, because the words are precatory, so Ravi's brother takes the money absolutely.
C. Yes, because the children are the objects of the trust.
D. No, because a trust must be created in writing.
E. Yes, because the amount is certain.

Answer: B. 'I am confident' expresses a hope, not a command, so the certainty of intention is missing and the brother takes absolutely. The amount is certain but that is only one of the three certainties. D is wrong on formalities, as money can be held on trust by oral declaration.

Worked question 2

Dalia leaves £100,000 'to my trustees to be divided equally among my friends.' Which statement is correct?

A. The trust is valid, because the is-or-is-not test is satisfied.
B. The trust is valid, because the trustees can use their discretion.
C. The trust fails for uncertainty of objects, because it is a fixed trust and 'friends' is conceptually uncertain.
D. The trust fails for uncertainty of intention.
E. The trust is valid, because the money is certain.

Answer: C. An equal division makes the trust fixed. A fixed trust needs a complete list, and 'friends' is too vague to provide one. A and B treat it as discretionary. D is wrong, as the intention is clear. The failed trust is held on resulting trust for Dalia's estate.

Checklist before you move on

Is the intention to create a trust clear?
Is the property identified, and each share?
Fixed or discretionary trust: complete list or is-or-is-not?
Is the class conceptually certain and workable?
Formalities (s53, Wills Act) satisfied?
Properly constituted?

Test yourself on more original questions in our SQE1 practice questions.

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Questions

What are the three certainties?

Certainty of intention, certainty of subject matter and certainty of objects.

What is the is-or-is-not test?

The test for a discretionary trust: it must be possible to say with certainty whether any given person is or is not a member of the class.

What happens if a trust fails for uncertainty?

The property is held on a resulting trust for the settlor or their estate, unless the failure is of intention, when the gift is generally absolute.

Sources: SRA: SQE1 Assessment Specification (from 1 September 2026); Law of Property Act 1925, section 53; Wills Act 1837. Checked 10 November 2026.