Remedia Trusts

Question 1

What is a remedial trust?

Answer 1

A remedial trust is an equitable remedy created by operation of law and therefore is not subject to the trust creation requirements, nor can it be challenged on Statute of Wills or Statute of Frauds grounds.

Question 2

What is the purpose of a resulting trust?

When is a resulting trust imposed?

Answer 2

When a trust fails or there is incomplete disposition of trust property, a court creates a resulting trust requiring the holder of the property to return it to the settlor or his estate ro prevent unjust enrichment.

Resulting trusts may be imposed when there is
-> a failure of an express trust, either because the trust is void or unenforceable or because the beneficiary cannot be located, unless the trust provides for disposition of the trust property in cases in which the trust may fail
OR
-> there is an incomplete distortion of trust assets due to an excess corpus

Question 3

What is a constructive trust?

Answer 3

A trust that is imposed when the court concludes that the person holding title to the property would profit by a wrong or be unjustly enriched.
-> wrongful conduct is required

Question 4

What is a gift-over clause?

Answer 4

Provides for the disposition of trust property if trust purpose fails.