Also known as: equitable owner · equitable owners · beneficial ownership · equitable title
Written by attorneys · grounded in primary & secondary sources — see below
An interest in property held by a beneficiary when legal title is vested in another party such as a trustee or installment seller. The interest carries the economic benefits and burdens of ownership including risk of loss under equitable conversion and priority in disputes with subsequent claimants to the extent of payments made in good faith.
Grantor placed future profits from a construction project into an irrevocable trust and gave Xavier authority to allocate the shares. Xavier executed a signed writing directing the trustee to assign the beneficial interests to East Builders and Vanessa. The allocation transferred equitable ownership of the profit shares to the named recipients under the power.
MetroCare entered an installment land contract with Lewis for a factory and paid half the price while taking possession and recording the contract. Regional later claimed under an earlier unrecorded agreement. The court recognized MetroCare's equitable ownership to the extent of its payments and granted an equitable lien protecting that interest.
Select any source to read its text and confirm it supports the definition.
Echo Systems registered shares in the name of a nominee. The board adopted a procedure allowing the beneficial owner to file a certificate electing record-shareholder treatment. Upon filing the certificate the beneficial owner obtained the rights and privileges of record ownership for voting and distributions.
Husband transferred assets to a revocable trust retaining broad powers over the property. After his death the wife claimed the transfer was illusory and sought to reach the assets for her elective share. The court examined whether the husband had truly divested himself of equitable ownership during life.
Williams purchased stock and executed a declaration stating that he held the shares in trust for named beneficiaries with the trust to terminate on a future date. The beneficiaries acquired an immediate equitable ownership interest in the stock even though legal title remained with Williams.
A Nebraska court awarded a wife an equitable interest in Washington land as part of a divorce decree. The husband later conveyed the land to a third party in Washington. The Supreme Court held that the Nebraska decree could not directly transfer legal title to out-of-state real property but recognized the wife's equitable ownership claim.
The seller retains legal title as security until the buyer completes payment. The buyer immediately receives equitable ownership together with possession and the risk of loss. Upon default the seller may pursue forfeiture or foreclosure depending on state law.
Supporting sources
A corporation may adopt a procedure allowing the person on whose behalf shares are held by a nominee to file a beneficial ownership certificate. Once filed the certificate holder is treated as the record shareholder for the rights and privileges specified in the procedure while the nominee loses those rights.
Supporting sources
No. The donee receives only the authority to designate who will receive beneficial ownership interests in the appointive property. The donee does not hold equitable ownership of the property itself unless the donee is also a permissible appointee and exercises the power in that capacity.
Supporting sources
The court quiets title in the prior claimant but grants the later buyer an equitable lien measured by payments made in good faith. The lien attaches to the property and must be satisfied by the prevailing title holder.
Supporting sources
…(Cf. Lines v. Lines , 142 Penn. St. 149; Potter Title & Trust Co. v. Braum , 294 Penn. St. 482; Beirne v. Continental-Equitable Title & Trust Co. , 307 Penn. St. 570.) In other jurisdictions transfers in trust have been upheld regardless of their purpose where a husband retained a right to enjoy the income during his…