Trust Flashcards
Who are the parties to a trust? What are their obligations?
A person who establishes trust is called a trustor, one in whom confidence is reposed as regards property for the benefit of another person is known as the trustee, and the person for whose benefit the trust has been created is referred to as the beneficiary.
What are the two kinds of trusts? Explain each briefly.
Trusts are either express or implied. Expressed trust are created by the intention of the trustor or of the parties. Implied trusts come into being by operation of law.
Is there any required form for expressed trusts?
Generally, there is no particular words or format required for expressed trust. Intention of the parties are sufficient. However, expressed trust concerning immovable properties or any interest therein must be in writing.
Is acceptance of the trust necessary to establish expressed trust?
Generally, acceptance of the beneficiary is necessary. Nevertheless, if the trust imposes no onerous condition upon the beneficiary, his acceptance shall be presumed, if there is no proof to the contrary.
What are the two kinds of implied trusts?
(1) Implied Resulting Trust - One that arises where a person makes or causes to made disposition of property under circumstances which raise an inference that he does not intend that the person taking or holding the property should not have beneficial interest in the property.
(2) Implied Constructive Trust - One imposed where a person holding the title to the property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if he were permitted to retain it.
What are the nine instances that an implied trust is established?
(1) A property is sold, and the legal estate is granted to the trustee, but the price is paid by the beneficiary for the purpose of having the beneficial interest of the property.
(2) A donation is made to the trustee, but it appears that although the legal estate is transmitted to the donee, he nevertheless is either to have no beneficial interest or only a part thereof.
(3) The price of a sale of property is loaned or paid by one person for the benefit of the other and the legal title is made to the lender to secure the payment of the debt.
(4) Two or more persons agree to purchase a property but the legal title is taken in the name of one of them for the benefit of all.
(5) A property is conveyed to a person in reliance upon his declared intention to hold it for or transfer it to another or the grantor.
(6) If an absolute conveyance of property is made in order to secure the performance of an obligation of the grantor toward the grantee.
(7) Trust funds is used to purchase a property and causes the conveyance to be made to him or to a third person.
(8) Land passes by succession to any person and he causes the legal title to be put in the name of another.
(9) Property is acquired through mistake or fraud, the person obtaining it is considered as the trustee for the person from whom the property comes.
