Also known as: express trusts
Written by attorneys · grounded in primary & secondary sources — see below
A trust intentionally created by a settlor through a declaration of trust or a transfer of property to a trustee for the benefit of designated beneficiaries. Creation requires the settlor's intent to create a trust, delivery of identifiable property to the trustee, and ascertainable beneficiaries. The trustee holds legal title subject to fiduciary duties enforceable in equity.
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Jade serves as personal representative of her father's estate holding a conservative bond portfolio. She liquidates the bonds and reinvests the proceeds in high-risk derivatives managed by a personal friend, producing substantial losses. Alexis, the sole beneficiary, sues and recovers the losses because Jade's improper exercise of power triggers liability measured by the standard applied to a trustee of an express trust.
David executes a written instrument directing South Freight to segregate five percent of freight receipts in a separate account for fleet repairs benefiting Irene and other drivers. When insolvency produces competing claims, the court applies the Uniform Trust Code because the instrument creates an express trust administered under its provisions.
A husband conveys property to a trustee with directions to pay income to himself for life and, upon his death, to apply the principal as he appoints by will. After his death without exercising the power, his heirs claim a remainder. The court holds that the undisposed interest is a reversion in the settlor's estate rather than a remainder passing by purchase.
Farkas executes trust instruments naming Williams as beneficiary of corporate stock and directing that Williams become absolute owner upon Farkas's death unless the trust is revoked. Williams dies before Farkas. The court determines that Williams acquired an immediate beneficial interest that passed to his estate rather than being defeated by his prior death.
Eyerman's will directs her executor to raze her residence and sell the lot, with proceeds added to the residuary estate. Neighbors and the city object that demolition would harm the neighborhood. The court refuses to enforce the direction because the purpose violates public policy and cannot be carried out through an express trust.
The settlor must manifest intent to create a trust, transfer identifiable property to a trustee, and designate ascertainable beneficiaries. A writing is required when the trust involves real property or is created by will. These requirements distinguish express trusts from resulting or constructive trusts that arise by operation of law.
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An express trust arises from the settlor's intentional declaration or transfer. A constructive trust is an equitable remedy imposed without regard to intent to prevent unjust enrichment from fraud, breach of confidence, or similar misconduct. The two devices serve different functions and rest on different foundations.
…reach the same conclusion. The direction to the trustee is the superfluous expression of a duty imposed by law. “Where an express trust is created, every legal estate and interest not embraced in the trust, and not otherwise disposed of, shall remain in or revert to, the person creating the trust or his heirs” (Real Prop.…
…the creation of the trust. As stated in 4 Powell, The Law of Real Property, at page 87: “Interests of beneficiaries of private
…by the owner of property to another person as trustee for the transferor or for a third person.” Further, we have held: “An
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Yes. The Code governs express trusts whether charitable or noncharitable and whether created during life or by will, provided the trust is to be administered in the manner of an express trust. It also reaches trusts created by statute, judgment, or decree that require express-trust administration.
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Under the Uniform Probate Code, a personal representative who improperly exercises power over estate assets is liable to interested persons for resulting loss to the same extent as a trustee of an express trust. The standard incorporates fiduciary duties of care and loyalty that govern express trustees.
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Yes. A settlor may convey legal title to a trustee while creating enforceable equitable interests in beneficiaries. Absent a statute limiting the purpose or duration of private land trusts, successive present and future equitable interests may be carved out of the trust property.
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