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*CHAPTER II.

CLASSIFICATION OF TRUSTS.

1. Trusts simple or special. The first and natural division of trusts is into simple and special.

Simple trust.—The simple trust is where property is vested in one person upon trust for another, and the nature of the trust, not being prescribed by the settlor, is left to the construction of law. In this case the cestui que trust has jus habendi, or the right to be put into actual possession of the property, and jus disponendi, or the right to call upon the trustee to execute conveyances of the legal estate as the cestui que trust directs.

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Special trust. The special trust is where the machinery of a trustee is introduced for the execution of some purpose particularly pointed out, and the trustee is not, as before, a mere passive depositary of the estate, but is called upon to exert himself actively in the execution of the settlor's intention; as where a conveyance is to trustees upon trust to sell for payment of debts.

2. Special trusts either instrumental or discretionary. Special trusts have again been subdivided into ministerial (or instrumental) and discretionary. The former, such as demand no further exercise of reason or understanding than every intelligent agent must necessarily employ; the latter, such as cannot be duly administered without the application of a certain degree of prudence and judgment.

A trust to convey an estate must be regarded as ministerial; for, provided the estate be vested in the cestui que trust, it is perfectly immaterial to him by what manner of person the conveyance is executed.

Trust to sell held by Mr. Fearne to be instrumental. · - A trust for sale was considered by Mr. Fearne as also ministerial; "for the price," he said, "is not arbitrary, or at the trustee's discretion, but to the best that can be gotten for the

estate, which is a fact to be ascertained independently of any discretion in the trustee" (a). But there is múch room for judgment in the time * and mode of pro- [*19] ceeding to a sale, and the precautions that are taken will have a material influence upon the price; and Mr. Fearne's opinion cannot at the present day be maintained (a).

Examples of discretionary trusts. A fund vested in trustees upon trust to distribute among such charitable objects as the trustees shall think fit (b), or an advowson conveyed to them upon trust to elect and present a proper preacher (c), is clearly a discretionary trust; for the selection of the most deserving objects in the first instance, and the choice of the best candidate in the second, is a matter calling for serious deliberation, and not to be determined upon without due regard to the merits of the candidates, and all the particular circumstances of the case.

3. Mixture of trust and power. There is frequent mention made in the books of a mixture of trust and power (d), by which is meant a trust of which the outline only is sketched by the settlor, while the details are to be filled up by the good sense of the trustees. The exercise of such a power is imperative, while the mode of its execution is matter of judgment and discretionary.

Distinguished from trust with power annexed. A mixture of trust and power is not to be confounded with a common trust to which a power is annexed; for, in the former case, as in a trust "to distribute at the discretion of the trustees," they are bound at all events to distribute, and the manner only is left open; but in the latter case, the trust itself is complete, and the power, being but an accessory, may be exercised or not, as the trustee may deem it expedient; as

(a) Fearne's P. W. 313.

(a) See King v. Bellord, 1 H. & M. 343; Robson v. Flight, 5 N. R. 344; S. C. 4 De G. J. & S. 608; Clarke v. Royal Panopticon, 4 Drew. 29.

(b) Attorney-General v. Gleg, 1 Atk. 356; Hibbard v. Lambe, Amb.

309; Cole v. Wade, 16 Ves. 27; Gower v. Mainwaring, 2 Ves. 87.

(c) Attorney-General v. Scott, 1 Ves. 413; Potter v. Chapman, Amb.

98.

(d) Cole v. Wade, 16 Ves. 43; Gower v. Mainwaring, 2 Ves. 89.

1 Steere v. Steere, 5 Johns. Ch. 1; 9 Am. Dec. 256.

where lands are limited to trustees with an authority to grant leases, or stock is transferred to trustees with a power of varying the securities; for in such cases the power forms no integral part of the trust, but is merely collateral and subsidiary, and the execution of it, in the absence of fraud, cannot be compelled by application to the Court.

4. Trusts lawful and unlawful. Again, trusts may be divided, with reference to the object in view, into lawful and unlawful. The former, such as are directed to some honest purpose (as a trust to pay debts, &c.), which are called by Lord Bacon Intents or Confidences, and will be administered by the Court. The latter are trusts created for the attainment of some end contravening the policy of the

law, and therefore not to be sanctioned in a forum [*20] professing not only justice but * equity, as a trust to

defraud creditors or to defeat a statute. Such are designated by Lord Bacon as Frauds, Covins, or Collusions (a). 5. Trusts public and private. - Another division of trusts is into public and private. By public must be understood such as are constituted for the benefit either of the public at large or of some considerable portion of it answering a particular description. To this class belong all trusts for charitable purposes, and indeed public trusts and charitable trusts may be considered in general as synonymous expressions (b). In private trusts the beneficial interest is vested absolutely in one or more individuals who are, or within a certain time may be, definitely ascertained, and to whom, therefore, collectively, unless under some legal disability, it is, or within

(a) Bac. on Uses, 9.

(b) See Attorney-General v. Aspinall, 2 M. & Cr. 622; Attorney-General v. Heelis, 2 S. & S. 76; Attorney-General v. Corporation of Shrewsbury, 6 Beav. 220; Walker v. Richardson, 2 M. & W. 892; Attorney-General v. Webster, 20 L. R. Eq. 483. But see Attorney-General v. Forster, 10 Ves. 344; Attorney-General v. Newcombe, 14 Ves. 1; Fearon v. Webb, ib. 19; Dolan v. Macdermot, 5 L. R. Eq. 60

(in which M. R. observed "Public purposes are such as mending or repairing roads, supplying water, making or repairing bridges, and are distinguished from charities in the shape of almsgiving, building almshouses, founding hospitals, and the like;" but public purposes, he added, "are all in a legal sense charities "); affirmed on appeal, 3 L. R. Ch. App. 677.

1 Lewis v. Nelson, 1 McCarter, 94.

*20 the allowed limit will be, competent to control, modify, or determine the trust. The duration of trusts of this kind cannot be extended by the will of the settlor beyond the bounds of legal limitations, viz., a life or lives in being with an engraftment of twenty-one years. A public or charitable trust, on the other hand, has for its objects the members of an uncertain and fluctuating body, and the trust itself is of a permanent and indefinite character, and is not confined within the limits prescribed to a settlement upon a private trust (c).

(c) Christ's Hospital v. Grainger, 1 Mac. & Gord. 460; Stewart v. Green, 5 I. R. Eq. 470.

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OF THE PARTIES TO THE CREATION OF A TRUST.

Now that we have defined and distributed trusts, we shall next enter upon the creation of them: First, By the act of a party, and Secondly, By operation of Law. Upon the subject of the former class we propose to treat, First, Of the necessary parties to the creation of a trust; Secondly, What property may be made the subject of a trust; Thirdly, With what 'formalities a trust may be created; Fourthly, Of Transmutation of Possession; Fifthly, What may be the object or scope of the trust; and Sixthly, In what language a trust may be declared.

In this chapter, we shall consider the necessary parties to a trust, under the three heads of the Settlor, the Trustee, and the Cestui que trust.

SECTION I.

OF THE SETTLOR.

1. General power creating a trust. As the creation of a trust is a modification of property in a particular form, it may be laid down as a general rule that whoever is competent to deal with the legal estate, may, if he be so disposed, vest it in a trustee for the purpose of executing the settlor's intention.

2. The Crown. The sovereign, as to his private property, may, by letters patent, grant it to one person upon trust for another (a). But the trust must appear upon the face of the letters patent; for if the grant be expressed to be

(a) Bac. on Uses, 66.

1 The settlor's intent must be carried into effect unless it contravenes some

policy of the law. Wright v. Miller, 8 N. Y. 9; 59 Am. Dec. 438.

2 In the United States, a state may be a settlor. Commissioners v. Walker, 6 How. (Miss.) 143; 38 Am. Dec. 433.