Trust: The Primer On Trusts

Trust is the relationship between a trustee to his trustor. Trustee is the person appointed by his trustor, the one who creates trust, to hold and manage or administer his assets for the benefit of the beneficiary (Manuals of Regulations of Banks, 2008). In trust, the trustor delivers a part or all of his assets for the benefit of the so-called beneficiary. (Primer on Trusts, n.d.). A trust is a legal structure in which title to property is transferred (Trust Arrangement, 2015). Each parties are involved in a formal agreement, called trust agreement. In this agreement, the trustor gives the rights of ownership to his properties to the trustee, on behalf of the beneficiary, for the conservation and protection. This agreement states the trust's

These are parties, intention, trust property, lawful purpose and the trust instrument. Parties are the participants to the trust, they are the persons engaged to trust. There are three parties in a trust, the trustee, the trustor and the beneficiary (Primer on Trusts, n.d.). For the succession of trust, each party must do their responsibilities and meet the expectations. A trust is started by a trustor who owns properties and assets. The trustor begins the trust with his intention to hold his properties to benefit someone. Trustor should have legal capacity to transfer properties. One of the trustor's reponsibilities is to determine who will be the beneficiary of his assets (Free Advice, n.d.). The next important party in a trust is the trustee. The trustee is the one who is responsible for holding properties of a trustor. Legal title is transferred to him by the the trustor to trust assets. He must agree that he will manage the property for the beneficiary. He has the full control to trust assets. Nevertheless, he should maintain the properties in a very good manner. Trustee may be a person or a corporation or intention (Seychelles International Trust, n.d.). The third party of a trust is the beneficiary. Beneficiary may be the trustor itself or other person. It can be an individual or entities. Beneficiary is the one benefits trust assets that has been created and is sufficiently identified as such. He has the equitable title to the trust

Trust can be effective through lifetime or after death. It can be a formed after death or by will. Trust is classified according to its purpose or form. Testamentary trust is a type of trust where the trustor transfers his trust assets through will and testament that will only be effective upon his death. (Primer on Trusts, n.d.). For example, the parent of the child wants their property to be pass after their death, they will make a will and testament stating that after their death, their property will be transfer to their child. The child must be old enough to manage the properties. In contrast to testamentary trust is the living or "inter vivos" trust. Inter vivos trust is a non-testamentary trust which is the created through agreement and takes effect on the lifetime of the trustor. For example, if the wife don't own many properties or if she plan to leave it all to his husband, a will may serve her better. Living trust is classified into two, revocable and irrevocable living trust. Revocable living trust, from the word itself, can be revoke. The trustor has the right to change or amend the terms and condition of trust, he has the right to get back his property while irrevocable is unchangeable once it is final (Hannibal, 2015). The next type is reversionary trust. It is when the trustor does not reserve the right to get the property but requires its automatic return to him after the lapse of a certain period or upon the