The constituting a trust were not satisfied. In Milroy,

The general rule
in equity held that to be valid a trust needs to be completely constituted
following the rules established in the case of Milroy v Lord. In this later,
Turner LJ held that: “The settlor must have done everything which (…) was
necessary to be done to transfer the property and render the settlement binding
upon him (…)” He, then has to transfer the property to the trustee “for the
purpose of the settlement” or has to hold the trust himself, and because equity
cannot perfect an imperfect trust. Indeed, an imperfect attempt to create a
trust using third party as a trustee will not be interpreted as a declaration
by the settlor of himself as trustee.

            Then if the settlor has failed to
create a perfect trust, the court will not create a trust that was not intended
by the settlor. When the trust is imperfect, the intended beneficiary does not
necessarily acquire an interest in the property, as seen in Milroy.             So, if the settlor does not succeed
to set up a trust property and did not comply with the requisite formalities,
then the court will not intervene to save it , as seen in the case of Jones v
Lock.1
To be perfectly constituted, the trust needs to be binding on the settlor and
should clearly define what interest are to be taken by the beneficiaries. When
the trust is not correctly established, beneficiaries have then no equitable
interest, in such circumstances, they are volunteers. A trust will not be completely constituted until the
legal title has been vested in the intended trustees. Then, it may fail if it
does not follow the legal rules unless all the formal steps to vest the
property in the trustee have been followed. 
Where there was an agreement to create a trust but there was no legal
transfer of the title, the trust is incomplete and there is no possibility to
enforce it as the requirement for constituting a trust were not satisfied. In
Milroy, what makes it an imperfect trust is that there was no intention for the
settlor to create a trust as the property was not vested in the name of the
transferee. Moreover, for an effective constitution of trust legal title must
be transferred to the trustee. In case of fraud, equity will not permit common
law to be used as an engine of fraud as seen in the case of La Rochefoucauld2.

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            The principle held in Milroy v Lord3,
 was beside confirmed by Jessel, in the
case of Richards v Delbridge4,
that a man may transfer his property only in one of two ways : first he may do
such acts as amounted in law to a conveyance or assignment of the property, and
thus completely divest himself of the legal ownership, in which case the
transferee takes it beneficially or on trust, as the case may be, or the
legal owner may by one or other of the modes recognised as amounting to a valid
declaration of trust, constituting himself as a trustee. In the case of
Richards v Delbridge5,
the court confirmed the decision in Milroy that a purposed gift will not save
(or perfect) an imperfect gift by creating a trust. Thus, to be perfectly and
correctly constituted, an express trust needs to see the settlor declare
himself a trustee of the trust  or
transfer to trustees to hold on trust, as confirmed by Lord Cranworth LC in the
case of Jones v Lock,6
that if there is no valid declaration of trust to be held in favour of the
trustee, then the trust fails. Therefore, an imperfect transfer will not give
rise to a valid constitution of trust. In this case, no trust was created, as the grandfather did not  declare himself a trustee of the lease for
the grandson, therefore the court will not construe an ineffectual transfer as
a valid declaration of trust as supported by Maitland7.

            Consequently, as analysed by
Halliwell8,
the case of Milroy sets up three methods to establish a settlement, “by way of
gift, by way of transfer to trustee to hold on trust or by declaration of
trust”. Therefore, if it is not following one of those three methods, it will
fail as equity does not assist a volunteer in perfecting an imperfect trust.

1
Jones v Locks (1865) 1 Ch App 25

2 La Rochefoucauld v Boustead (1897)
1 Ch 196

3
Ibid1

4
George Jessel, in Richards v
Delbridge (1874) LR 18 Eq 11 CA

5 Ibid

6 Ibid 2

7 Frederic W Maitland, Equity :
A Course of Lectures (Cambridge University Press, 1909),73

8 Margaret Halliwell,’Perfecting imperfect gifts and trusts: have we
reached the end of the Chancellor’s foot’ (2003) Conv 192,3