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10 Cards in this Set

  • Front
  • Back
Trust Defined
A trust is a fiduciary relationship where the title is divided between the trustee who has legal
title and the beneficiary who has beneficial title.
Parties to a trust
1. settlor
2. Trustee
3. beneficiaries
Parties to a Trust
o Settlor -the person who creates the trust
o Trustee -the person managing the trust
o Beneficiary - Those whom the trust benefits
Charatible Trusts
Not subject to the Rule against Perpetuities
• They have to be for the good of the community at large
• Must be for a charitable purpose
 Religion, Medicine, Science, Government (parks. Research, education

Most honorary trusts do not qualify as charitable trust
• Must be in favor of a reasonably large number of unidentifiable beneficiaries
• Cy Pres-when a specific charitable purpose can no longer be accomplished, it
may be reformed under cy pres ("as nearly as possible").
 Court first determines the intent of the settlor
• If there is a broad intent found then the trust will be reformed
 There is a strong tendency to uphold charitable gifts, and to keep such
gifts in the charitable domain rather than the private domain by finding that cy
pres should be applied
Resulting Trust
Arises as an operation of law in one of two situations:
 Where an express trust fails or makes an incomplete disposition, or
 Where a person pays purchase price and causes the property to be
taken in the name of another person who is not the natural object of the bounty
of the purchaser
• Also known as a purchase money resulting trust
Constructive Trust
There must be unjust enrichment - where justice allows
 Confidential relationship, promise by transferee, reliance on the
promise and unjust enrichment for the transferee
Creation of a Trust
1. intent
2. delivery
3. trust property
4. trust beneficiaries
5. written instrument
6. execution
Creation of a Trust
intent
No particular form of words is necessary
• The sole question is whether the grantor manifested an intention to create a
trust
• Some to vest legal ownership in one person for another declaration showing
intent
• There is a corresponding intent to impose duties
Creation of a Trust
Delivery
Delivery of the subject matter of the trust with the intent to pass title to the trustee
• Transfer of an interest in deed or writing
 Transfer can be created gratuitous or contractual
• Delivery of the trust property must occur during the settlor's/grantor's lifetime
Creation of a Trust
Trust Property
Must be some property interest on which the trust relationship can be imposed
• Res can be any type of property so long as it is in existence and can be
transferred
• If there is no certain and identifiable trust property there is no trust
Creation of a Trust
Trust Beneficiaries
Trust must be in favor of ascertainable beneficiaries
 Immediate family includes children, grandchildren and their issue, but
not aunts, uncles, nieces and nephews (nothing lateral)
• A beneficiary has standing to bring suit
• The trust may be may be private or charitable but they must be sufficiently
ascertainable
 A private express trust must be for ascertainable beneficiary's
 A class of beneficiaries may be designated if sufficiently definite
• If the beneficiary designation does not specifically describe an
individual or group, the trust fails.
 A charitable trust cannot be for the benefit of identifiable private
individuals
• If not for a specifically identifiable charitable agency, it must be
in favor of a reasonably large class of indefinite beneficiaries
 Absent a statute, pets cannot be the beneficiary of a trust
• FL has such a statute.
• Also known as an honorary trust
 A beneficiary's interest is assignable as long as it is not a spendthrift
trust.