speech of Lord Upjohn in Vandervell v IRC [1967] 2 AC 291

Please read the following extract from the speech of Lord Upjohn in Vandervell v IRC [1967] 2 AC 291 and then answer the questions which follow. Note that this case is also vitally important in the area of resulting trusts. That aspect of the decision, however, has been omitted. You should also note that Lord Wilberforce decided the section 53(1)(c) point on a different ground altogether from the rest of his brethen. That reasoning is not pursued here.
(Brief facts: Mr Vandervell was the beneficiary of a bare trust of shares. He orally directed his trustee to transfer the shares to the Royal College of Surgeons, which it did, his intention being that they receive the shares outright. The question for the House of Lords was whether this oral direction was a purported disposition of Vandervell's interest under the trust and therefore void for want of writing, with the result that the Royal College of Surgeons only held the shares on bare trust for Vandervell, and not outright as he had intended. The Court of Appeal had found that section 53(1)(c) had no application to the facts of the case. The case then went to the House of Lords.)
Lord Upjohn
The question is whether notwithstanding the plainly expressed intention of the appellant by himself or his agents the absence of writing prevented any equitable or beneficial interest in the shares passing to the college so that contrary to his wishes and understanding they remained bare trustees for him. This depends entirely upon the true construction of section 53(1)(c) of the Law of Property Act, 1925, which the Crown maintain makes writing necessary to pass the beneficial interest. This section was generally thought to re-enact section 9 of the Statute of Frauds and that section had never been applied to a trust of an equitable interest of pure personalty. Before the cases of Grey v Inland Revenue Commissioners and Oughtred v Inland Revenue Commissioners, both in your Lordships' House, this argument would have been quite untenable.
It was shown in those cases that the Law of Property Act, 1925, was not re-enacting section 9 but that it had been amended by the Law of Property Act, 1924. The relevant words of section 53 are: '...a disposition of an equitable interest or trust subsisting at the time of the disposition, must be in writing signed by the person disposing of the same. ....' Those words were applied in Grey and Oughtred to cases where the legal estate remained outstanding in a trustee and the beneficial owner was dealing and dealing only with the equitable estate. That is understandable; the object of the section, as was the object of the old Statute of Frauds, is to prevent hidden oral transactions in equitable interests in fraud of those truly entitled, and making it difficult, if not impossible, for the trustees to ascertain who are in truth his beneficiaries. But when the beneficial owner owns the whole beneficial estate and is in a position to give directions to his bare trustee with regard to the legal as well as the equitable estate there can be no possible ground for invoking the section where the beneficial owner wants to deal with the legal estate as well as the equitable estate.
I cannot agree with Diplock LJ that prima facie a transfer of the legal estate carries with it the absolute beneficial interest in the property transferred; this plainly is not so, eg, the transfer may be on a change of trustee; it is a matter of intention in each case. But if the intention of the beneficial owner in directing the trustee to transfer the legal estate to X is that X should be the beneficial owner I can see no reason for any further document or further words in the document assigning the legal estate also expressly transferring the beneficial interest; the greater includes the less. X may be wise to secure some evidence that the beneficial owner intended him to take the beneficial interest in case his beneficial title is challenged at a later date but it certainly cannot, in my opinion, be a statutory requirement that to effect its passing there must be some writing under section 53(1)(c).
Counsel for the Crown admitted that where the legal and beneficial estate was vested in the legal
owner and he desired to transfer the whole legal and beneficial estate to another he did not have to do more than transfer the legal estate and he did not have to comply with section 53(1)(c); and I can see no relevant difference between that case and this.
As I have said, that section is, in my opinion, directed to cases where dealings with the equitable estate are divorced from the legal estate and I do not think any of their Lordships in Grey and Oughtred had in mind the case before your Lordships. To hold the contrary would make assignments unnecessarily complicated; if there had to be assignments in express terms of both legal and equitable interests that would make the section more productive of injustice than the supposed evils it was intended to prevent.
I think the Court of Appeal reached a correct conclusion on this point ....