Comprehensive Legal Advice: Rex Lear's Will, Trust, and Share Claims

This case study provides legal advice to Cordelia regarding claims and management of Rex Lear's estate. It examines whether Goneril and Regan must return funds to the Lear family trust due to breaches of fiduciary duties by investing in private securities against the will's stipulations. It further explores the potential liability of Fredrick's company, SFIM, for charging management fees without proper authorization and consent. Finally, the analysis addresses Edmund's handling of company shares held on Rex's behalf, focusing on whether Cordelia can contest claims on those shares and related assets after Edmund's bankruptcy. The advice leverages principles of trust law, fiduciary duties, and equitable assignments to assess the legal standing of each party and the potential for Cordelia to recover assets for the estate. Desklib offers similar solved assignments for students.

Final Client Legal Advice

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
1...................................................................................................................................................3
2...................................................................................................................................................5
3...................................................................................................................................................6
4...................................................................................................................................................8
CONCLUSION................................................................................................................................9

INTRODUCTION
Legal advice refers to the providing of the professional opinion on the procedure
of the law related to the particular situations. The professionals providing legal advice
involves analysis of facts and advices to take particular legal action based on the law.
The case revolves around the will of Rex Lear who has made a will prior his
death. He had invested in trust which was suppose to go to the relatives each years as
selected by the elder daughter. However no selection is made till yet. In the will money
was allowed only to be invested in government bonds or securities however, both the
younger daughters invested it in the private securities. Rex also let Edmund hold his
shares in a public company but Edmund spend all the money on his personal expenses.
The report will aim to focus on proving legal advice to Cordelia on various questions
regarding the claims and management of all the money of Rex.
MAIN BODY
1.
Gonerial and Regan have to return all the funds to the Lear family Trust to her
father’s state. This is because the trust was supposed to provide money to all the
relatives and family as decided by Cordelia. In England the equitable interest is vested
which means a retains no equitable interest at all when equitable party has vested in B.
the Act also states that the subject matter of declaration in writing is necessary. Rex had
made the trust deed as the income from trust shall be distributed to the relatives and
friends as Cordelia selects. It also stated that the money shall be invested in fixed
securities only but Goneril and Regan breached the trust deed by investing in stock
market. This leads to breach in fiduciary duties by Goneril and Regan as trustees of the
trust.
From the above mentioned directions, Cordelia can take any direction as it is up-to
her to make selections according to the will of her father. The others cannot perform any
other duty without prior informing to her. The Fiduciary duties are declared as
prospective which means the fiduciary cannot make any unauthorized profit from their
fiduciary position.
In the case Rex clearly mentioned in the trust's will that the money cannot be invested in
any of the other securities rather than the government bonds and the securities.

However, Gonerial and Regan took the advice of Frederick and invested in private
securities. It was breach of fiduciary duty by both of them. These duties are strict which
means there will be no allowance for contributory negligence (Trustee nature,
obligations). In the case of Pilmer v Duke Group Ltd., the Court has said that positive
duties are regulated by contract, tort or other equitable doctrines. In simple words it
means the fiduciary is not allowed to argue that the principle should have been more
careful. It can be invested only by the fully informed consent of those to whom the duty
is owned. It clearly depicts the situation of Cordelia. Codelia have the full rights to ask
Gonerial and Regan for paying back the money to their Father's trust as Cordelia was
the beneficiary who had the duty to transfer those funds. However, Gonerial and Regan
breached their duties without prior asking to Cordelia and used the money, even when
they do not had the authority to do so.
The informed consent states that a fiduciary is able to escape the liability a
breach of fiduciary duty if the informed consent of the person to whom the fiduciary
obligations were owned. Only the person whom have the legal capacity cab give the
consent. However, in the case, Gonerial and Regan did not informed Cordelia before
investing in private securities. Also Cordelia was the one who could give them the
consent and then they could invests. From the law it is considered that the there are
strict equitable principles which states that the person occupying position of confidence
in relation to another owes which other a duty not to be put in a position to make a
profit for self. They must be made accountable for all the material fact to the party on
which the duty is obliged. In the reach of duty, the other parties who have breached he
law are obligated to account for the duties breached (Breach of fiduciary duty).
However, the duties were breached and Cordelia can take legal actions against
Gonerial and Regan if they do not return all the funds of Trust in their father's estate.
The chances of success of Cordelia are high as she has the legal authority as depicted
by law.

2.
In the law the person who have inter-meddled in the affairs of the trust without
the authority and have assumed some measures of control over the trust property are
regarded as trustee de son tort. They are regarded as a trustee who is through their one
wrongdoings. It is also to be noted that the property which are subject to a trust and
transfer is not authorized is included in breach. The recipient have not participated in
the breach but must have knowledge about it. Here in this case fiduciary duties are
applicable. In Law Fredrick can ask for managing fee as the company was managing
the funds of trust.
In the case of Cordelia, Fredrick was the third party. He was not an authorized
trustee for the trust yet his company was charging amounts of fee for managing the trust
fund. He was the one in whose company the investment was made. He did not had the
authority to do so. Gonerial and Regan were the trustees and had some knowledge of
the same. So both of them are also involved in the breach (Breach of fiduciary duty)..
The recipient liability is also seen as fault based liability and the same notice
demands assistance in the same. From the Law it is states that dispose of property
beyond the authority whether actual or usual, the dealing is to be treated as void and no
interest to the third party passes. From the Dishonest design it can be analyses that the
breach of trust is too onerous to impose equitable liability on professional advisers if the
breach is declared innocence. There are many actions which against parties who
procures an Innocent breach of trust.
However, in the case of Cordelia, she had no knowledge regarding the charging
of fee by Fredrick's company for the management of Lean family trust funds. However
the other parties which are Gonerial and Regan are considered to have knowledge
regarding the same as they agreed to invest in Fredrick's company. Here there is
breach of trust which allows Cordelia to take a legal action against the same. She can
ask Fredrick to return all the fee charged by his company to her father's trust. In the
case of Gonerial and Regan innocent breach of trust can also be considered as they
invested in Fredrick's company yet they were unaware of the fee charged by his
company to manage the funds of Trust.

Also the fiduciary duties also depict that the fiduciary cannot make any
unauthorized profits from their fiduciary position. In the case of Farah constructions Pty
Ltd v Say-Dee Pty Ltd (2007), before Barnes, a line of cases accepted that thirst party
must be treated as a participant in breach of trust. (The fiduciary obligation and duties)
Here the profits made form SFIM were earned by Fredrick involving a management fee.
Fredrick did not had any authority to charge fee from the Lean family trust nor the other
trustees, Gonerial and Regan had authority to invest in Fredrick's company. This all
leads to breach of trust. Cordelia can take action against SFIM for charging fee for
which it did not had any authority and nor had informed consent of beneficiary which is
Cordelia. In the principle of equity is the fiduciary has to account to the person who have
obligation for any gain. This principle was also neglected in the case of Cordelia as she
did not has any information.
Fredrick may be assessorial available as Goneril and Regan have breached their
fiduciary duties. Fredrick has induced the breach of trust through trustees. Before
Barnes, there was a line of cases in which it was accepted that a third party might be
treated as a participant in a breach of trust where the third party had knowingly induced
or immediately procured breaches of duty by a trustee where the trustee had acted with
no improper purpose. Gonerial and Regan did not had information regarding Fredrick’s
investment management. However, they went against the rules of the trust and
breached their duties (Accessorial Liability).
3.
Edmund was holding the shares of the company on behalf of Rex. Rex had told
him to hold the shares until he decides what will he do next. After the death of Rex,
Edmund had to return the amounts of dividend received from the shares of that public
co0mpany. The official receiver in bankruptcy have claimed the remaining items of
Edmund including a parcel and bank balance and the expensive artwork as well. Rex
has given the claims of his shares of public company to Edmund for holding. The shares
were legally in the names of Edmund. Now Rex is dead so the anything received was
suppose to go to Edmund regarding the company. The law states that the shares were

of Edmund as they were of his name. Rex’s statement stipulated that might be for
Edmund (Equitable assignment of equitable property).
In the case Express trust can be applied. Express trust is the trust in which a
person holds property of other persons not for their benefit but the benefit of others. The
trustee owe fiduciary duties to all beneficiaries. The express trust also states that the
benefits received from the property of trust are to be shared equally or as decided
between the beneficiaries. If the distribution of entitlements is not defined or is
depended upon trustee it is called discretionary trust. Bare trust on the other hand have
no active duties, they just hold the property for other person. However, shares were
future property which has different rules.
Here in this case, Rex told Edmund to hold the property not for his personal
benefit but for the benefit of others. Here the situation is of bare trust. Rex just
expressed his trust to Edmund in the form of bare trust. No duties were asked to be
performed by Edmund. When Rex died, Edmund received dividend on the property of
Rex which he had bare trust. But after his death Edmund used all the money received
from the dividend paid on shares on his personal expenses. Here is the breach of bare
trust. Here the daughters of Rex were beneficiaries. The claim of dividend was suppose
to go to the beneficiaries which are Rex's daughters. But instead Edmund used all the
money on himself.
From the express trust, it is depicted that the trust of benefit must go to the
specific person which are regarded as beneficiaries unless it is a charitable trust. In the
case of Creak V James Moore & Sons Pty Ltd (1992) majority held that return of actual
property cannot be claimed. Rex did not wanted his name on the register this is way he
used Edmund's name on the register. He was just the trustee for the property. Edmund
was no owner of the money received, yet he used that money. The money received by
Edmund was not charitable. When Edmund went bankrupt, the money was claimed by
the official receiver of bankruptcy. Cordelia cannot contest the Official receiver's claims
on the shares registered in Edmund's name and the art piece as well. Cordelia wanted
shares and the remaining funds. However, Edmund’s shares were 100,000 which
means he is not liable for any funds.

Diamond ring was a gift which means that it was now Amy’s property not Edmund’s.
The diamond ring can be traced back to Amy. Cordelia has no right on the diamond ring
(Assignment of gifts).
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In the present case, Elizabeth called Cordelia and stated that she wants them to
give some of the property to her younger sister Margaret on 2 October. But on 5
October the Elizabeth died, but she named her three daughters as the beneficiaries. In
the present case, Cordelia is not obliged to distribute the property of Rex to Margaret.
This is particularly because of the reason that in the present case there is no legal
obligation of Cordelia to provide the property to Margaret. The reason underlying this
fact is that there is not any legal binding contract or any written note stating that
Elizabeth is giving a part of property of Rex to Margaret. Thus, the decision relies upon
all the three daughters that whether they need to share a part of property with Margaret
or not. Along with this, in case they wish to keep the wish of their mother then they can
share a little part of property with her younger sister. But this is also not based only on
decision of Cordelia. This is because of the reason that when all the three daughters
that is Goneril, Regan and Cordelia are the beneficiaries. Hence, the decision will be on
the consensus of all the three and not only of one single that is Cordelia.
In addition to this, another reason which states that the wish of Elizabeth is not
valid is that this wish must be present in will of the person. This is particularly because
of the reason that each and every wish is being listed in the terms of the will. In case all
the items present in the will are not fulfilled then against this any legal action can be
taken. This is particularly the will is a legal document and all the things mentioned in will
need to executed in the same manner. But, in the present case of Elizabeth, nothing
was mentioned in the will and because of this, it is the decision of all the beneficiary of
trust the whether they need to share the property with Margaret or not. The use will is
very essential as it is a document which outlines the wish of the person who is either
dead or facing some of the health issues. Elizabeth was the sole beneficiary of Rex’s
will. The beneficiaries on Elizaberth’s will were Gonreial, Regan and Cordelia. The

assignment of legal property law states that the discretionary trust “relatives and friends”
which Elizabeth had on Margret (Assignment of legal property). From the case of sale of
goods Act 1923, passing of property in goods by sale is depicted. Tangible property is
treated as a part of trade law, consumer law and commercial law.
Along with this, it is also very essential for the person to have the will in writing
and get it notified from the court. The reason underlying this fact is that when the will not
be in writing and notified then any person can do some change in the will after death of
the person. Hence, because of this reason it is essential for person to have will in
writing and get it notified. Hence, in case all these things are done then no person can
change the will. In the current case of Elizabeth, as well they are not having anything in
written and because of this, the decision is in hands of all the three beneficiaries only
and not as per the wish of Elizabeth. So Elizabeth could do anything to assign the
property to Margret. She has done enough through which she can transfer the property
to Margret. She can demand for equitable compensation and constructive trusts as
remedy (Discretionary trust “relatives and friends”).
CONCLUSION
From the above discussion it can be concluded that the legal advices allows a
person to have professional opinions on the legal proceedings. The whole case
revolves amount Rex and his daughters. After his death various situations are depicted
where legal advice is needed by Cordelia the eldest daughter who is also the
beneficiary of the will. But certain situations Fredrick, both the sisters and her nephew
had claimed money without her informed consent for which she demanded legal advice.
She is provided with legal advices as per the situations and the action which she can
take as well. In one situation she claims the money from all the sisters as they spend it
on the Fredrick's company. In other case she gets to know that Fredrick is charging
money for managing the fee of her father;s trust funds which she had no idea about.

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