Introduction to trusts

Question 1

Key Characteristics of the Trust Concept

Answer 1

1) Property owned and managed by trustee/s
2) For the benefit of B/ charitable purpose; settlor usually drops out the picture (Unless s=b, or he reserved power of appointment)
3) Trusteeship is normally an onerous fiduciary duty to which rights and obligations are automatically attached (trust property is managed for the proper purpose of the trust)
4) Trustee owes equitable personal obligation to account for her stewardship of the trust property to B
5) B has corresponding equitable personal rights against Ts AND equitable proprietary interest in the trust fund
6) The trust fund (or segregated trust fund) is not available to meet the claims of the trustee’s personal creditors
(7) The court has a supportive role in addition to its enforcement role)

Question 2

What does Bs equitable proprietary interest in the trust fund mean/ what power do they have

Answer 2

due to their equitable proprietary interest in the trust assets Bs are entitled to trace the trust assets and recover from anyone but a bona fide purchaser for value without notice of the beneficiaries’ rights