McPhail v Doulton / Re Baden’s Deed Trusts (No1) [1971]

Case concerned discretionary trust for large class of
employees and their relations.
House of Lords decided by 3:2 majority that the ‘is or
is not’ test was appropriate for discretionary trusts as well.
Lord Wilberforce pointed out that in applying tests courts
are concerned only with conceptual uncertainty,
not evidential uncertainty.
Trust will not fail for latter.
Problems of applying individual ascertainability test:
1.  In
considering exercise of discretion, trustees should (per Lord Wilberforce in McPhail) make a survey of the entire
field of objects, and consider each individual case on its merits.
Since under new test trustees may be unable to
discover identities of all possible beneficiaries, administrative problems.
Wilberforce suggested way out of problem:
Even if a disposition satisfies the test, might still
fail if class is so widely drawn as to be administratively unworkable.
Eg Gift to ‘all the residents of Greater London’
2.  How can Saunders v Vautier operate if the entire
class of beneficiaries cannot be ascertained?