ABSTRACT
A person who lacks legal title to money or property may have an equitable title to the same. In the class of case already discussed, where by trust the transferor divests himself of both the legal and the equitable title to the property, the intention of the settlor is defeated, in that if the whole trust fails for illegality the equitable title reverts to him, and if it is only a condition that is illegal, the beneficiary sometimes takes free of the illegal condition. The traditional rule of equity against recognising the equitable title in the cases remained the law for almost 200 years. The traditional rule which denies recovery once it is shown that the transfer was made for an illegal purpose has attracted some degree of criticism, primarily because its application “is indiscriminate and so can lead to unfair consequences as between the parties to litigation”.
