LAW OF TRUSTS

English Trust Japanese Trust Chinas Trust

13/03/2014

LAW OF TRUST(LAW 3711)

English Trust
Pierre

Le Paulle ; The trust is the guardian angel of Anglo-Saxon, accompanying him everywhere, impassively, from cradle to grave. (Gerweyn Ll Griffiths The Guardian Angel Spreads Its Wings? Trusts and What They Bring to Legal Systems.)
13/03/2014 LAW OF TRUST(LAW 3711) 2

 Developed

from the concept of use to a more stable and established institution. Used for variety of reasons. Uniquely British institution.

13/03/2014

LAW OF TRUST(LAW 3711)

4 Essential Elements of A trust

1) Trust property : the corpus or body 2) The trustee the person or entity in whom the corpus is entrusted. 3) Beneficiaries the persons on whose behalf the property is managed 4) The Deed or instructions the documents which outlines the manner in which the trust property is to be dealt with on behalf of the beneficiaries

13/03/2014 LAW OF TRUST(LAW 3711) 4

1) Trust property :
The corpus or body Specific property land or personal property Lord Browne- Wilkinson In Westdeutche v Islington London Borough Council [1996] 2 All ER 961 at 988 In order to establish a trust there must be identifiable trust property

13/03/2014

LAW OF TRUST(LAW 3711)

2) The trustee
The

person or entity in whom the corpus is entrusted Trustees become owners at common law and are given control of the property Trust property need to be constituted in the hand of trustee
13/03/2014 LAW OF TRUST(LAW 3711) 6

3) Beneficiaries
The

person who is entitled to the trust property. The settlor / trustee may be the beneficiary or one of the beneficiaries.

13/03/2014

LAW OF TRUST(LAW 3711)

4) The Deed
When

a person created a trust through trust instruments, he is known as settlor. Sometimes, trust can be created verbally. It can also be created in a will the person who created the trust is known as testator
13/03/2014 LAW OF TRUST(LAW 3711) 8

Article 2 of the Hague Convention on the Law Applicable to Trusts On Their Recognition (English Recognition of Trust Act 1987)

For the purpose of this Convention, the term trust refers to the legal relationship created intervivos or on death- by a person, the settlor, when assets have been placed under the control of a trustee for The benefit of a beneficiary or for specified purpose.

13/03/2014

LAW OF TRUST(LAW 3711)

A trust has the following characteristic; a) The assets constitute a separate fund and are not part of the trustees own estate b) Title to the trust assets stands in the name of the trustee or in the name of another person on behalf of the trustee; c) The trustee has the power and the duty, in respect of which he is accountable, to manage, employ or dispose of the assets in accordance with the terms of the trust and the special duties imposed upon him by law
13/03/2014 LAW OF TRUST(LAW 3711) 10

Classification of Trust
Many

ways to categorize trust. Broadly classified into: Depends on the objectives of the trust.

13/03/2014

LAW OF TRUST(LAW 3711)

11

From the point of view of intent to create trust a) Express or declared b) Presumed or implied; or c) Constructive trust

From point of view if the objects of the trust; a) Private or b) Public or charitable
13/03/2014 LAW OF TRUST(LAW 3711) 12

From the point of view of the nature of the duties imposed upon trustee a) Simple or b) Special

From the point of view of the form of declaration of trust a) Executed or b) Executory
13/03/2014 LAW OF TRUST(LAW 3711) 13

TYPES OF TRUST
Private Trust
Express Trust

Public Trust
Charitable

Constructive
Resulting
Executed & Executory
13/03/2014 LAW OF TRUST(LAW 3711)

Non charitable
Offshore
Completely Constituted & Incompletely Constituted
14

Trust and other concept.

Trust

and Bailment Trust and Agency Trust and Contract Trust and Debt Trust and Power.

13/03/2014

LAW OF TRUST(LAW 3711)

15

TRUST AND BAILMENT Bailment: Goods are delivered to a bailee to he held for a particular purpose upon an express/implied condition that it will be redelivered to the bailor when the purpose has been carried out Bailment
Limited to personal chattel Bailee : no fiduciary duties Bailor : Legal ownership Bailee: special property Unauthorised sale by bailee: no good title All property Trustee : fiduciary duties Trustee: Legal ownership Beneficiary : Legal Ownership Unauthorised sale by trustee: to bona fide purchaser : good title

Trust

13/03/2014

LAW OF TRUST(LAW 3711)

16

TRUST AND AGENCY

Agency Personal right Based on contractual relationship Act according to business agency

Trust Proprietary right Based on fiduciary relationship Act according to the trust deed

13/03/2014

LAW OF TRUST(LAW 3711)

17

TRUST AND CONTRACT Contract Based on agreement Consideration Doctrine of Privity Trust Based on intention Can be enforced by beneficiary

Personal Remedy
Terms of contract can be varied Limitation Period for BOC

Proprietary Remedy
Terms can only be varied under certain ctc Limitation Period for BOT

13/03/2014

LAW OF TRUST(LAW 3711)

18

Japanese Trust
Very

different from UK : trust is a legal medium for property management. In Japan : all property belongs to the family : family estate. Properties were also donated for religious purposes No clear and defined systematic type of trust in Japan
13/03/2014 LAW OF TRUST(LAW 3711) 19

Property management
Civil Code of Japan : based on the principles of German private law It satisfied every needs for property administration : from family law to will implementation No need for introduction of trust Concept of act of trust and trust like act were referred to in some court rulings and discourse Eg : mortgage-like contract ,a pension entitlement.

13/03/2014 LAW OF TRUST(LAW 3711) 20

Modern trust system

First introduced from the middle of the Meiji period Can be found in article 9 paragraph 4 of Industrial Bank of Japan Act 1900 Later in Secured Bond Trust Act 1905 : concept of trust was put to use for the first time Introduced Trust Act 1922 in the Parliament

13/03/2014 LAW OF TRUST(LAW 3711) 21

Chinas Trust Law

Trust

business has been in existence for over 20 years. One of the weakest and least regulated industries. In 2001, government took steps in introducing new trust law

13/03/2014

LAW OF TRUST(LAW 3711)

22

Chinas Trust Law

Law of Peoples Republic of China on Trusts (Trust Law) Adopted on 28th April 2001 In force on 1st October 2001 8 years of hard work by various government committees. Extensive survey was conducted on trust law in many jurisdictions.

13/03/2014 LAW OF TRUST(LAW 3711) 23

Impact.
Chinas further economic development with respect of many matters.Eg Corporate Organization Preservation of overseas state assets Individual estate planning NGO charitable trust.
Enhance
13/03/2014 LAW OF TRUST(LAW 3711) 24

The trust Law closely follows the trust laws in Taiwan, Japan and Korea- AngloAmerican law of trusts. Embodied many principles found in the common law countries. Certain unique principles which are inconsistent with Anglo- American law of trusts, .

13/03/2014 LAW OF TRUST(LAW 3711) 25

 Trust

law has assimilated many principles in Anglo- American trust law New principles to China Well drafted but China faces difficult task in implementing it. It is a borrowed statute.

13/03/2014

LAW OF TRUST(LAW 3711)

26