A conveys property to B in trust to sell it and pay out of the proceeds the claims of A's creditors. A…
Section 78 lets the author revoke a trust for payment of his debts at pleasure only where it "has not been communicated to the creditors". The illustration to section 78…
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A conveys property to B in trust to sell it and pay out of the proceeds the claims of A's creditors. A reserves no power of revocation. The creditors are parties to the arrangement. Under the Indian Trusts Act, 1882, can A revoke the trust?
Answer and explanation
Correct answer C
Section 78 lets the author revoke a trust for payment of his debts at pleasure only where it "has not been communicated to the creditors". The illustration to section 78 adds that "if the creditors are parties to the arrangement, the trust cannot be revoked without their consent". Once the creditors are parties, the trust is for their benefit and is no longer A's to undo.