HomeAbout UsWorldwide OfficesContact UsLinks
Home > Services > Trust services > Trust concept
Services

Trust concept

The concept of a trust was first used in Anglo Saxon times and is an arrangement whereby property is transferred from one person (The Settlor) to another person or corporate body (The Trustee) to hold the property for the benefit of a specified list or class of persons (The Beneficiaries). Although a trust can be created solely by verbal agreement it is normal for a written document to be prepared which evidences the creation of the trust (the Trust Deed), sets out the terms and conditions upon which the trust assets are held by the Trustees and outlines the rights of the Beneficiaries. In essence, a trust is not dissimilar to a will except that assets are transferred to trustees during lifetime rather than those assets being transferred to executors on death. The trust deed is analogous to the deed of will. Those unfamiliar with the trust concept usually express concern at the idea of transferring ownership of their property to a trustee. However, this concern can be alleviated if the trust concept and the distinction between legal ownership as contrasted with beneficial ownership is properly understood and the trust is governed by a sound trust law which can be enforced in a reputable jurisdiction. The distinction between legal and beneficial ownership in English law evolved over centuries and has been transferred to many jurisdictions around the world, either through the adoption of English common law and equitable principles or as part of the express legislation of local law. International recognition of trusts has also been achieved by The Hague Trusts Convention which has been signed, ratified and implemented by a number of countries.