Trust

Trust, Trustee. A trust in its simplest form is a relation between two persons by virtue of which one of them (the trustee) holds property for the benefit of the other (the cestui que trust), while as regards the outer world he is for most purposes the absolute owner of it. The right of the cestui que trust to that benefit is enforceable as a personal right only against the trustee and those who have acquired interests in the trust property with notice of the trust. As between the trustee and cestui que trust, and those claiming under them, the cestui que trust is in effect beneficial owner of the trust property, either absolutely or with restrictions, according to the nature of the trust. As trusts were formerly enforced only in equity, he is sometimes called equitable owner. This equitable ownership or interest is assignable, except in the case of a restraint on alienation, or anticipation, or of a discretionary trust. By the Statute of Frauds all grants and assignments of trusts must be in writing, signed by the grantor or assignor. No particular form of words is required for an assignment of a trust, but it is the custom to employ the same kind of instrument and the same form of words as if the interest were legal instead of equitable. The devolution of a trust follows the rules of law applicable to a corresponding legal estate or interest. Trust property is liable to be taken in execution, and if the cestui que trust becomes bankrupt it vests in the trustee in his bankruptcy, The ownership of the trustee, on the other hand, is not subject to his debts, does not pass to his trustee if he becomes bankrupt, and is not, liable to succession duty on his death. Trusts arise either by the act of the party, or by operation of law, i.e. implied. (1) Trusts by act of the party are either express or implied. An express trust is one created by clear words, as where A gives property to B in trust for C, or otherwise expresses a clear intention that C shall have the benefit of it. A is called the author of the trust or the settlor, testator, etc., according to the instrument by which the trust is created. (2) An implied trust is where the intention to create the trust is inferred. Thus if A gives property to B, "not doubting," "entreating," or "hoping" that B will employ it for the benefit of, C, a trust is implied in favour of C; the execution of which C can enforce.