Trust definition (duhaime)

R. Oerton's Underhill's Law Relating to Trusts & Trustees (London: Butterworths, 1970),
page 3 defines a trust as:

".. an equitable obligation binding a person (who is called a trustee) to deal with property
over which he has control (which is called the trust property), for the benefit of persons
(who are called beneficiary or cestui que trust), of whom he may himself be one, and any
one of whom may enforce the obligation. Any act or neglect on the part of a trustee
which is not authorized or excused by the terms of the trust instrument, or by law, is
called a breach of trust."

A legal obligation with respect to property given by a person (donor) to another (trustee)
to the advantage of a beneficiary

Related Terms: Constructive Trust, Discretionary Trust, Express Trust, Resulting Trust,
Secret Trust, Sprinkling Trust, Trustee, Beneficiary, Fixed Trust, Settlor, Donor, Cestui
Que Trust or Cestui Que Use , Use

A legal obligation given by a person called the donor or settlor, binding upon the trustee,
for the benefit of another person (the beneficiary, cestui que trust or donee).

An independent legal process that a person, usually called a settlor or a donor, can initiate
and once started, runs its course to the benefit of a beneficiary and as administered by a
person of the settlor's choice, called a trustee, the latter, once apppointed, accountable to
the beneficiary.

The American authority, Scott on Trusts (formal citation: Scott, A. and Fratcher, W., The
Law of Trusts, Boston: Little, Brown and Company, 1987, p. 41) very meekly proposes
this definition (of an express trust), which leads one to imagine the lengthy committee
meeting from which it issued:

"... a fiduciary relationship with respect to property, subjecting the person by whom the
title to property is held to equitable duties to deal with the property for the benefit of
another person, which arises as a result of a manifestation of an intention to create it."

The trustee manages and administers the property, actual ownership is shared between the
trustee and the beneficiary and all the profits go to the beneficiary.

The word fiduciary can be used to describe the responsibilities of the trustee towards the
beneficiary.

When a person dies, their assets are held in trust until they can be distributed. Thus, a will
forms a trust (called a testamentary trust) but trusts can be formed during the lifetime of
the settlor in which case it is called an inter vivos or living trust.
Trusts are further subdivided into express trusts, statutory trusts, and resulting or
constructive trusts end even quistclose trusts.

Further Reading:
 Introduction To The Law of Trusts
 Trust Law: The Players
 Trust Law: When Things Get Nasty
 Charitable Trusts
 Constructive and Resulting Trusts
 Trust Law: The Big Cases

CATEGORIES AND TOPICS:

This term applies to the following categories or areas of law:

 Trusts, Wills, Estates and Probate Law Dictionary

Unless otherwise noted, this article was written by Lloyd Duhaime, Barrister, Solicitor,
Attorney and Lawyer (and Notary Public!). It is not intended to be legal advice and you
would be foolhardy to rely on it in respect to any specific situation you or an
acquaintance may be facing. In addition, the law changes rapidly and sometimes with
little notice so from time to time, an article may not be up to date. Therefore, this is
merely legal information designed to educate the reader. If you have a real situation, this
information will serve as a good springboard to get legal advice from a lawyer.