Simple English definitions for legal terms
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Definite trust beneficiaries are people who are named or can be identified as beneficiaries in a trust. A trust is a legal agreement where someone (the settlor) gives property to someone else (the trustee) to manage for the benefit of others (the beneficiaries). The beneficiaries must be identifiable, meaning there must be a clear way to know who they are. For example, saying "my children" is okay because it's clear who the settlor's children are, but saying "my friends" is not okay because it's too vague. If a trust doesn't have definite beneficiaries, it can't be enforced. However, if the trust is for a charity, it doesn't need definite human beneficiaries because it's enforced by the state attorney general.
Definition: Definite beneficiaries are individuals or groups of people who are named or can be identified as beneficiaries of a trust. A trust must have definite beneficiaries to be valid. This is because the beneficiaries are the ones who enforce the trust. The settlor can name the beneficiaries or identify a group or class of people as beneficiaries, as long as there are objective standards to define the group.
Example: "My children" is an example of an ascertainable class of persons because there are objective standards to identify who is included as the settlor's children. However, "my friends" is not an ascertainable class because it is a subjective identification and it is difficult to ascertain who is included in the class of "friends".
If a trust does not have definite beneficiaries and is not created for the benefit of a charity, it is deemed to be an unenforceable trust. However, an exception to this rule is when the trust is a charitable trust which is created to benefit a charity. A trust created to benefit a charity is not required to have definite human beneficiaries, because a charitable trust is usually enforced by the state attorney general.
Example: It would be permissible to create a charitable trust that gives 1 million "to be used to feed the hungry in Essex County, Massachusetts." This is an example of a charitable trust that does not have definite human beneficiaries, but instead has a definite charitable purpose.
These examples illustrate the importance of having definite beneficiaries in a trust, as well as the exception for charitable trusts. Definite beneficiaries ensure that the trust can be enforced and that the beneficiaries receive the intended benefits. Charitable trusts, on the other hand, do not require definite human beneficiaries because they are enforced by the state attorney general and have a definite charitable purpose.