TRUST. In Roman and English law alike that legal relation between two or more persons implied in the word trust was of comparatively late growth. The trust of English law is probably based upon a combination of the Roman conceptions of usus and fideicommissum. To usus is perhaps due the name as well as the idea of that right over property, coordinate with the right of the nominal owner, possessed by the person having the use. To fidei-commissum appears to be due the name as well as the idea of that confidence reposed in another which is the essence of the modern trust. Usus was in Roman law a personal servitude, or right of one person over the land of another, confined to his personal wants and without the right to the produce and profits which ususfructus carried. It has little in common with the use of English law but the name and the conception of a dual ownership. The fideicommissum is more important; see Roman Law, vol. xx. p....
707. By the legislation of Justinian the law of legata was practically assimilated to that of fideicommissa. The only thing that distinguished the one from the other was the mode in which the gift was made: if by words of direct bequest, it was a legatum, if by precatory words, a fideicommissum. It may be noticed, as an illustration of the course afterwards taken by the law in England, that fideicommissa in favour of the church were so far favoured over others that if paid over by mistake they could not be recovered. In addition to usus and fideicommissum, the Roman division of ownership into quiritary and bonitary (to use words invented at a later time) may perhaps to some extent have suggested the English division into legal and equitable estate. The two kinds of ownership were amalgamated by Justinian. Legal and equitable estate are still distinct in England, though attempts have been made in the direction of amalgamation. The gradual manner in which the beneficiary became subject to the burdens attaching to the property of which he enjoyed the benefit was a feature common to both the Roman and the English system.
Uses in Early English Law.— The use or trust is said to have been the invention of ecclesiastics well acquainted with Roman law, the object being to escape the provisions of the laws against Mortmain (q.v.) by obtaining the conveyance of an estate to a friend on the understanding that they should retain the use, i.e ., the actual profit and enjoyment of the estate. Uses were soon extended to other purposes. They were found valuable for the defeat of creditors, the avoiding of attainder, and the charging of portions. A use had also the advantage of being free from the incidents of feudal tenure: it could be alienated inter vivos by secret conveyance, and could be devised by will. In many cases the feoffee to uses, as he was called, or the person seised to the use of another, seems to have been specially chosen on account of his rank and station, which would enable him to defy the common law and protect the estate of his cestui que use, or the person entitled to the beneficial enjoyment. The Act of 1 Ric. II. c. 9 was directed against the choice of such persons. This alienation of land in use was looked upon with great disfavour by the common law courts, in whose eyes the cestui que use was only a tenant at will. Possibly the ground of their refusal to recognize uses was that the assizes of the king’s court could only be granted to persons who stood in a feudal relation to the king. The denial of the right followed the denial of the remedy. The use was on the other hand supported by the Court of Chancery, and execution of the confidence reposed in the feoffee to uses was enforced by the court in virtue of the general jurisdiction which as a court of conscience it claimed to exercise over breach of faith. Jurisdiction was no doubt the more readily assumed by ecclesiastical judges in favour of a system by which the church was generally the gainer. A double ownership of land thus gradually arose, the nominal and ostensible ownership,—the only one acknowledged in the courts of common law,—and the beneficial ownership protected by the Court of Chancery. The reign of Henry V. to a great extent corresponds with that of Augustus at Rome, as the point of time at which legal recognition was given to what had previously been binding only in honour. The means of bringing the feoffee to uses before the court was the writ of subpoena, said to have been invented by John de Waltham, bishop of Salisbury and master of the rolls in the reign of Richard II. By means of this writ the feoffee to uses could be compelled to answer on oath the claim of his cestui que use. The doctrine of the Court of Chancery as to the execution of a use varied according as there was transmutation of possession or not. In the former case it was unnecessary to prove consideration; in the latter, generally a case of bargain and sale, the court would not enforce the use unless it was executed in law,—that is, unless there was a valuable consideration, even of the smallest amount. Where no consideration could be proved or implied, the use resulted to the feoffor. This theory led to the insertion up to a recent date in deeds (especially in the lease of the lease and release period of conveyancing) of a nominal consideration, generally five shillings. Lands either in possession, reversion, or remainder could be granted in use. Most persons could be feoffees to uses. The king and corporations aggregate were, however, exceptions, and were entitled to hold the lands discharged of the use. On the accession of Richard III., who from his position of authority had been a favourite feoffee, it was necessary to pass a special Act (1 Ric. III. c. 5), vesting the lands of which he had been feoffee either in his co-feoffees or, in the absence of cofeoffees, in the cestui que use. The practical convenience of uses was so obvious that it is said that by the reign of Henry VII. most of the land in the kingdom was held in use. The freedom of uses from liability to forfeiture for treason must have led to their general adoption during the Wars of the Roses. The secrecy with which a use could be transferred, contrary as it was to the publicity required for livery of Seisin ( q.v.) at common law, led to the interference of the legislature on several occasions between the reigns of Richard II. and Henry VIII., the general tendency of the legislation being to make the cestui que use more and more subject to the burdens incident to the ownership of land. One of the most important statutes was the Statute of Mortmain (15 Ric. II. c. 5), forbidding evasion of the Statute De Religiosis of Edward I. by means of feoffments to uses. Other Acts enabled the cestui que use to transfer the use without the concurrence of the feoffee to uses (1 Ric. III. c. 1), made a writ of formedon maintainable against him (1 Hen. VII. c. 1), rendered his heir liable to wardship and relief (4 Hen. VII. c. 17), and his lands liable to execution (19 Hen. VII. c. 15). At length in 1535 the famous Statute of Uses (27 Hen. VIII. c. 10) was passed. The preamble of the statute enumerates the mischiefs which it was considered that the universal prevalence of uses had occasioned, among others that by fraudulent feoffments, fines, recoveries, and other like assurances to uses, confidences, and trusts lords lost their feudal aids, men their tenancies by the curtesy, women their dower, manifest perjuries in trials were committed, the king lost the profits of the lands of persons attainted or enfeoffed to the use of aliens, and the king and lords their rights of year, day, and waste, and of escheats of felons’ lands. To remedy this state of things it was enacted, inter alia, that, where any person was seised of any hereditaments to the use, confidence, or trust of any other person by any means, the person having such use, confidence, or trust should be seised, deemed, and adjudged in lawful seisin, estate, and possession of such hereditaments. Full legal remedies were given to the cestui que use by the statute. He was enabled to distrain for a rent charge, to have action, entry, condition, &c. The effect of this enactment was to make the cestui que use the owner at law as well as in equity (as had been done once before under the exceptional circumstances which led to 1 Ric. III. c. 5), provided that the use was one which before the statute would have been enforced by the Court of Chancery. For some time after the passing of the statute an equitable as distinct from a legal estate did not exist. But the somewhat narrow construction of the statute by the common law courts in Tyrrel's case (1557) enabled estates cognizable only in equity to be again created. In that case it was held that a use upon a use could not be executed; therefore in a feoffment to A and his heirs to the use of B and his heirs to the use of C and his heirs only the first use was executed by the statute. The use of B being executed in him, that of C was not acknowledged by the common law judges; but equity regarded C as beneficially entitled, and his interest as an equitable estate held for him in trust, corresponding to that which B would have had before the statute. The position taken by the Court of Chancery in trusts may be compared with that taken in Mortgage (q.v. ). The Judicature Act, 1873, while not going as far as the Statute of Uses and combining the legal and equitable estates, makes equitable rights cognizable in all courts. From the decision in Tyrrel's case dates the whole modern law of uses and trusts. In modern legal language use is restricted to the creation of legal estate under the Statute of Uses, trust is confined to the equitable estate of the cestui que trust or beneficiary.
Uses since 1535.— The Statute of Uses is still the basis of conveyancing. A grant in a deed is still, after the alterations in the law made by the Conveyancing Act, 1881, made “to and to the use of A.” The statute does not, however, apply indiscriminately to all cases, as only certain uses are executed by it. It does not apply to leaseholds or copyholds, or to cases where the grantee to uses is anything more than a mere passive instrument, e.g. , where there is any direction to him to sell the property. The seisin, too, to be executed by the statute, must be in another than him who has the use, for where A is seised to the use of A it is a common law giant. The difference is important as far as regards the doctrine of Possession ( q.v.). Constructive possession is given by a deed operating under the statute even before entry, but not by a common law grant (at any rate sufficient to entitle the grantee to be registered as a voter), until actual receipt of rent by the grantee. The operation of the Statute of Uses was supplemented by the Statute of Inrolments and that of Wills. (See Will.) The Statute of Inrolments (27 Hem VIII. c. 16) enacted that no bargain and sale should pass a freehold unless by deed indented and inrolled within six months after its date in one of the courts at Westminster or with the custos rotulorum of the county. As the statute referred only to freeholds, a bargain and sale of a leasehold interest passed without inrolment. Conveyancers took advantage of this omission (whether intentional or not) in the Act, and the practical effect of it was to introduce a mode of secret alienation of real property, the lease and release, which was the general form of conveyance up to 1845. (See Real Estate, Sale.) Thus the publicity of transfer, which it was the special object of the Statute of Uses to effect, was almost at once defeated. In addition to the grant to uses there were other modes of conveyance under the statute which are now obsolete in practice, viz., the covenant to stand seised and the bargain and sale. Under the statute, as before it, the use has been found a valuable means of limiting a remainder to the person creating the use and of making an estate take effect in derogation of a former estate by means of a shifting or springing use. At common law a freehold could not be made to commence in futuro ; but this end may be attained by a shifting use, such as a grant (common in marriage settlements) to A to the use of B in fee simple until a marriage, and after the celebration of the marriage to other uses. An example of a springing use would be a grant to A to such uses as B should appoint and in default of and until appointment to C in fee simple. The difficulty of deciding where the seisin was during the suspension of the use led to the invention of the old theory of scintilla juris, or continued possibility of seisin in the grantee to uses. This theory was abolished by 23 and 24 Vict. c. 38, which enacted that all uses should take effect by force of the estate and seisin originally vested in the person seised to the uses. The most frequent instances of a springing use are powers of appointment, usual in wills and settlements. There has been much legislation on the subject of powers, the main effect of which has been to give greater facilities for their execution, release, or abandonment, to aid their defective execution, and to abolish the old doctrine of illusory appointments.
Trusts.— A trust in English law is defined by Mr Lewin, adopting Coke’s definition of a use, as “a confidence reposed in some other, not issuing out of the land, but as a thing collateral, annexed in privity to the estate of the land, and to the person touching the land, for which cestui que trust has no remedy but by subpoena in Chancery.” The term trust or trust estate is also used to denote the beneficial interest of the cestui que trust. The term truster is not used, as it is in Scotland, to denote the creator of the trust. A trust has some features in common with Contract (q.v.) ; but the great difference between them is that a contract can only be enforced by a party or one in the position of a party to it, while a trust can be, and generally is, enforced by one not a party to its creation. It has more resemblance to fideicommissum. But the latter could only be created by a testamentary instrument, while a trust can be created either by will or inter vivos ; nor was there any trace in Roman law of that permanent legal relation which is suggested by the position of trustee and cestui que trust. The heir, too, in Roman law was entitled, from 70 a.d. to the reign of Justinian, to one-fourth of a hereditas fideicommissaria as against the beneficiary, while the very essence of the trust is its gratuitous character. Trusts may be divided in more than one way, according to the ground taken as the basis of division. One division, and perhaps the oldest, as it rests on the authority of Bacon, is into simple and special, the first being where the trust is simply vested in a trustee and the nature of the trust left to construction of law, the second where there is an act to be performed by the trustee. Another division is into lawful and unlawful, and corresponds to Bacon’s division into intents or confidences and frauds, covins, or collusions. A third division is into public and private, the former being synonymous with charitable trusts. A division often adopted in modern text-books and recognized by parliament in the Trustee Act, 1850, is into express, implied, and constructive. An express trust is determined by the person creating it. It may be either executed or executory, the former where the limitations of the equitable interest are complete and final, the latter where such limitations are intended to serve merely as minutes for perfecting the settlement at some future period, as in the case of marriage articles drawn up as a basis of a marriage settlement to be in conformity with them. An implied trust is founded upon the intention of the person creating it; examples of it are a resulting trust, a precatory trust, and the trust held by the vendor on behalf of the purchaser of an estate after contract and before conveyance. In this case the vendor is sometimes called a trustee sub modo and the purchaser a cestui que trust sub modo. A constructive trust is judicially created from a consideration of a person’s conduct in order to satisfy the demands of justice, without reference to intention. The distinction between an implied and a constructive trust is not always very consistently maintained. Thus the position of a vendor towards a purchaser after contract is sometimes called a constructive trust. The present law governing trusts rests upon the doctrines of equity as altered by legislation. Its great importance has led to its becoming one of the most highly developed departments of equity. The devolution of successive interests in wills and settlements is almost wholly attained by means of trusts.
Who may be a Trustee or Cestui que Trust.— The modern trust is considerably more extensive in its operation than the ancient use. Thus the crown and corporations aggregate can be trustees, and personalty can be held in trust Provision is made by the Municipal Corporations Act, 1882, for the administration of charitable and special trusts by municipal corporations. The crown does not appear to be a trustee to as complete a degree as a subject may be. Unsuccessful attempts have recently been made to impress the crown, or a secretary of state as agent of the crown, with trusts of funds voted by parliament for the public service, of booty of war granted by royal warrant, and of money paid over by a foreign state in pursuance of a treaty. There are certain persons who for obvious reasons, even if not legally disqualified, ought not to be appointed trustees. Such are infants, lunatics, persons domiciled abroad, felons, bankrupts, and cestuis que trustent. The appointment of any such person, or the falling of any existing trustee into such a position, is generally ground for application to the court for appointment of a new trustee in his place. Any one may be a cestui que trust except a corporation aggregate, which cannot be a cestui que trust of real estate without a licence from the crown.
Creation and Extinction of the Trust.— A trust may be created either by act of a party or by operation of law. Where a trust is created by act of a party, the creation at common law need not be in writing. The Statute of Frauds (see Fraud) altered the common law by enacting that all declarations or creations of trusts or confidences of any lands, tenements, or hereditaments shall be manifested and proved by some writing, signed by the party who is by law enabled to declare such trust, or by his last will in writing, or else they shall be utterly void and of none effect. Trusts arising or resulting by implication or construction of law are excepted, and it has been held that the statute applies only to real estate and chattels real, so that a trust of personal chattels may still be declared by parol. The declaration of a trust by the crown must be by letters patent. Trusts created by will must conform to the requirements of the Wills Act (see W ill). Except in the case of charitable trusts, the cestui que trust must be a definite person. A trust, for instance, merely for keeping up family tombs is void. Alteration of the trust estate by appointment of a new trustee could up to 1860 only be made where the instrument creating the trust gave a power to so appoint, or by order of the Court of Chancery. But now by the Conveyancing Act, 1881 (superseding Lord St Leonards’s Act of 1860), the surviving or continuing trustee or trustees, or the personal representative of...
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