Rule in Re Atkinson
Encyclopedia
Re Atkinson [1904] Ch 160 is an English trusts law
case, which lays down a rule of equity relating to the disposition by the trustee
s of an authorised mortgage security where the security forms part of a trust fund
, and the beneficiaries of the trust fund include a tenant for life and a remainderman
. Where the security is sold and the proceeds are insufficient to satisfy the principal and interest in full, it is necessary to determine the way in which the loss shall be shared as between the tenant for life and the remainderman. The sum realised by the sale must be apportioned between the life tenant and the remainderman in the proportion that the amount due for the arrears of interest bears to the amount due in respect of principal. The rule also applies to debenture stock, but not to dividend
s or arrears of dividends on preference shares.
English trusts law
English trusts law is the original and foundational law of trusts in the world, and a unique contribution of English law to the legal system. Trusts are part of the law of property, and arise where one person gives assets English trusts law is the original and foundational law of trusts in the...
case, which lays down a rule of equity relating to the disposition by the trustee
Trustee
Trustee is a legal term which, in its broadest sense, can refer to any person who holds property, authority, or a position of trust or responsibility for the benefit of another...
s of an authorised mortgage security where the security forms part of a trust fund
Trust law
In common law legal systems, a trust is a relationship whereby property is held by one party for the benefit of another...
, and the beneficiaries of the trust fund include a tenant for life and a remainderman
Remainderman
A remainderman is a person who inherits or is entitled to inherit property upon the termination of the estate of the former owner. Usually this occurs due to the death or termination of the former owner's life estate, but this can also occur due to a specific notation in a trust passing ownership...
. Where the security is sold and the proceeds are insufficient to satisfy the principal and interest in full, it is necessary to determine the way in which the loss shall be shared as between the tenant for life and the remainderman. The sum realised by the sale must be apportioned between the life tenant and the remainderman in the proportion that the amount due for the arrears of interest bears to the amount due in respect of principal. The rule also applies to debenture stock, but not to dividend
Dividend
Dividends are payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders. When a corporation earns a profit or surplus, that money can be put to two uses: it can either be re-invested in the business , or it can be distributed to...
s or arrears of dividends on preference shares.