Trust Agreement Uk

In essence, the term “trust” applies to any situation where a person owns property in the name of another person and the law recognizes the obligations to use the property for the benefit of the other. [32] The main situation in which a trust is formed is the express intention of a person who “bills” the property. The “Settlor” will give property to someone he trusts (an “agent”) to use for someone close to his heart (a “beneficiary”). The fundamental requirement of the law is that a trust was truly “intentional” and that a gift, a relaxation or an agency relationship was not. The courts not only seek a guarantee on the intent of the administrator, but also propose that the terms of the trust be sufficiently secure, particularly with respect to the property and who should benefit from it. The courts also have the rule that a trust must ultimately be for people and not for a purpose, so that if all beneficiaries agree and age the most complete, they can decide how to use the property itself. [33] The historical trend towards the construction of trusts is to find a way to tax them. However, if the trust is designed as a charity, public order must ensure that it is always enforced. Non-profit trusts are one of the specific types of trusts governed by the Charities Act 2006. There are also very detailed rules for pension funds, for example under the Pensions Act 1995, in particular to define the legal obligations of dependants and to require a minimum of funding. The remedy for the beneficiaries is the return of all profits and, in theory, all profits are maintained on a constructive trust in the trust fund.

[212] The same rule applies to adversarial transactions called “self-negotiation” where an agent enters into contracts with himself or a party related to the name of the trust. Although an agent is strict on the merits, he may at any time simply seek the consent of the beneficiaries or the court before seizing an opportunity that might be of interest to the trust. The extent of the tax and the authorized transactions of certain types may also be defined in the fiduciary company in order to exclude liability. According to Millett LJ in Armitage/Nurse[202], to the point that the agent still acts “honestly and in good faith for the good of the beneficiaries.” Finally, if an agent has indeed acted honestly, while a court can formally confirm that the agent must forego its profits, the court may recognize the agent as a generous quantum meruit.