Legal Definitions - express trust

An express trust is a legal arrangement created intentionally and explicitly by an individual or entity, known as the settlor. This type of trust is established through clear, direct instructions, usually documented in a written agreement like a will or a trust deed. The settlor clearly outlines their intention to create the trust, identifies the assets to be placed into it, names the beneficiaries who will benefit from the assets, and appoints a trustee to manage those assets according to the specified terms. Unlike an implied trust, which arises from circumstances or the law, an express trust is a deliberate and purposeful act of creation.

Here are some examples illustrating an express trust:

• Example 1: A Testamentary Trust for Minor Children

  A parent, Sarah, writes a will stating, "I hereby transfer all my assets into a trust for the benefit of my two minor children, Emily and David, to be managed by my sister, Aunt Carol, until each child reaches the age of 25. Aunt Carol shall use the trust funds for their education and living expenses."

  Explanation: This is an express trust because Sarah (the settlor) intentionally created it through her will, a written document. She explicitly named the beneficiaries (Emily and David), designated the trustee (Aunt Carol), specified the assets (all her assets), and clearly defined the terms and conditions for the trust's operation and distribution (for education and living expenses until age 25).

• Example 2: A Living Trust for Asset Management

  Mr. Henderson, a retiree, creates a detailed legal document titled "The Henderson Family Revocable Living Trust." In this document, he declares himself as the initial trustee and names his daughter, Lisa, as the successor trustee upon his incapacitation or death. He transfers his house, investment portfolio, and bank accounts into the trust, specifying that the assets are to be managed for his benefit during his lifetime and then distributed equally among his three children after his passing.

  Explanation: This is an express trust because Mr. Henderson (the settlor) deliberately established it through a written trust agreement. He explicitly identified the assets, named the beneficiaries (himself initially, then his children), appointed trustees (himself and Lisa), and clearly laid out the terms for managing and distributing the trust property.

• Example 3: A Charitable Foundation Trust

  A philanthropist, Dr. Anya Sharma, establishes "The Sharma Medical Research Trust" with a formal trust deed. She donates a substantial sum of money and specifies that the funds are to be permanently invested, and the annual income generated must be used exclusively to fund innovative medical research grants for diseases affecting children, administered by a board of trustees she appoints.

  Explanation: This constitutes an express trust because Dr. Sharma (the settlor) intentionally created it through a written trust deed. She explicitly defined the purpose (funding medical research), identified the beneficiaries (children affected by diseases, through research), contributed specific assets (a sum of money), and established clear terms for its ongoing management by the appointed board of trustees.