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CHAPTER III.

TRUSTS.

SECT. 1. Their Nature, Duration, Qualities, and Incidents.
SECT. 2. Classification of Trusts.
SECT. 3. How Created, Declared, and Transferred.
Sect. 4. Rights, Powers, and Duties of Parties to Trusts.
SECT. 5. Trusts under the Law of New York.

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THEIR NATURE, DURATION, QUALITIES, AND INCIDENTS.

1. Trusts of general use and application.
2. How early in use in England.
3. How enforced, writ of subpæna. ·
4. Of the terms legal and equitable applied to estates.
5. Use and trust formerly alike.
6. Principles of the statute 27 Hen. VIII. ch. 10.
7. Trusts defined.
8. Circumstances which led to their adoption.
9. On what the system rests, and how built up.
10. Tyrrel's case, no use upon a use.

1. The importance of the law of trusts may be, in some measure, appreciated, when it is considered, if works of good authority in England are to be relied on, that the title to a vast proportion of the lands in that kingdom is vested in trustees. And although this may not be true to the same extent of this country, it is beyond question that immense interests are involved in trusts here, and that these are increasing every year.1

1 Hill, Trust. 42; Tud. Lead. Cas. 276; Co. Lit. 290, Butler's note, 249, $ 15.

2. Something answering to trusts in respect to lands in cases where the simple rules of the common law were modified by the action of the chancellor, where equity required his interposition to enforce agreements in respect to such lands, was recognized in the English law, probably as early as A. D. 920.1

3. The mode by which the enforcement of a trust was at last sought to be accomplished, was by means of a writ, framed by the chancellor, called a writ of Subpoena, compelling the party charged with a trust to come into court, and answer to the articles which were contained in the petition, upon which the subpoena was issued. If there was a trust, the party was obliged to disclose it upon oath, and the court, thereupon, decreed that he should carry it into execution.2

4. It was because these collateral obligations could not be taken cognizance of as interests in lands, by the common law, and were cognizable as such, only in courts of equity, that they took the name of equitable to distinguish them from legal estates.3

5. Although, as has been shown in the preceding chapter, the equitable or beneficial interest which one man had in land, *which in the eye of the common law, belonged to another, [*161] was commonly called a use, it was also often called a trust, these being, in fact, convertible terms prior to the statute of 27 Hen. VIII., and the word “trust" is mentioned even in that statute as well as “use.”4 These terms, however, were at that time understood to indicate equitable interests of somewhat different natures. If the interest was a permanent enjoyment of the benefit or profits of the land, separate from the possession, it was called a use. If it was for a temporary purpose, as the raising of a sum of money out of the land, it was a trust. And in this sense, though every use was a trust, every trust was not a use.5

6. The rules which regulate trusts, are based upon the principles of a refined moral duty between persons who stand in the relation of confidence to each other. The statute of 27 Hen. VIII. c. 10, has

8 Ibid.

i Co. Lit. 290 b, Butler's note, 249, § 15; Gilbert, Uses, Sugd. ed. 2, 3.
3 Ibid. ; 1 Spence, Eq. Jur. 338.
• 2 Crabb, Real Prop. 512; 2 Bl. Com. 327; 1 Prest. Est. 184.

5 1 Prest. Est. 185; Cornish, Uses, 14, 15; 1 Spence, Eq. Jur. 448, who distinguishes them thus, the one an use or permanent trust,” the other “a temporary, special, or active trust.” VOL. II.

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been pretty fully considered in the preceding chapter. It classes “trusts,” “ uses,” and “confidences,” in one category, and undertakes to apply the same remedy to all, by uniting the legal with the equitable interest into a new legal estate. But it became apparent, upon applying this statute, that there were . cases where this could not be effected without defeating the obvious purposes of the trust, or extending the language of the statute beyond its necessary meaning. While, therefore, full effect was given to the statute where the seisin could be united with the use, or where, in other words, the use was executed by the statute, it was accordingly done, and only one interest or estate thereupon remained. But where the use could not be thus executed, the legal estate was necessarily left as at common law. But equity, perceiving that to allow the holder of the legal estate to have the beneficial use of it, was contrary to the intention

of the parties, interposed to hold the tenant of the legal es[*162] tate a trustee for him who was entitled to *the beneficial

use of it, and the consequence was, that while one party had a right to the seisin and possession of land as at common law, equity regarded him for whose use the land was designed, as the rightful owner thereof, and, in this way, there early grew up a double ownership of lands thus situated, the legal and the equitable one.

Thus it was held, that as a use was executed by uniting the seisin which was in one, with the use which was in another, and as there could be no seisin, properly speaking, of a use ; if there were a feoffment to A, to the use of B, to the use of C, the seisin in A passed to and was executed to the use in B. But as only a use was given to B, it was held, that the seisin which the statute united to the use in B, did not pass from him to C, and it consequently left the seisin in B, as the legal owner. In order, however, to give effect to the second part of the limitation, equity came in and required B to hold the estate to the use of C, and called this a trust. So it often happened, that lands were given to one to do certain acts in respect to the same for the benefit of a third person, a feme covert, for instance, which required him to hold the seisin and legal estate. In such a case, inasmuch as to execute the use in the one for whose benefit the land was granted or devised, would defeat the purposes of such grant or devise, the seisin was held to remain in the grantee

1 Ante, pp. *108_*156.

or devisee, while equity required him to perform the duty or confidence imposed upon him under the name of a trust. So, where land is given to A for a term of years in trust for B, it is a technical trust, since the statute of uses only executes a use in cases where a seisin is united with it.1

7. A trust may, therefore, be defined as a use, which, though lawful in itself, the statute does not operate upon to execute in the cestui que use, whereby the legal estate is in one, while another *has a right to a beneficial interest in and out of the [*163] same, the first being termed a trustee, the other a cestui que trust. Thus, for illustration, a grant or devise to A in trust for B, or to permit B to take the rents and profits, would be an executed use in B, unless B was a feme covert, when, in order to carry out the grantor's or devisor's intent, it would be a trust, or use not executed. If, on the contrary, the trust is created for some special purpose, as to convey the estate, or exercise control over it, such as paying the taxes, or making repairs upon it and the like, it is a trust which the statute will not execute, and of course it leaves the legal estate in the trustee. The following definition of trusts, as given by a writer, it will be perceived, corresponds nearly with that of uses before the statute, namely : “A right in the cestui que trust to take the profit of lands, whereof the legal estate is vested in some other person, and to compel the person, thus seised of the legal estate, to execute such conveyances of the land as the person entitled to the profits shall direct, and to defend the title to the property." 5 Mr. Sanders defines a trust to be “a right on the part of the cestui que trust to receive the profits and dispose of the lands in equity." And this is adopted by Ch. Kent.7'

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1 2 Sharsw. Bl. Com. 335-337 and notes ; 2 Crabb, Real Prop. 507; 1 Prest. Est. 190; Cornish, Uses, 27-29; 1 Spence, Eq Jur. 466; id. 490; 1 Sand. Uses, 266; Ilopkins v. Ilopkins, per Lord Hardwicke, 1 Atk. 591; 1 Eq. Cas. Abr. 383 ; Fletch. Trust. 27; Ashhurst v. Given, 5 Watts & S. 327.

2 Tud. Lead. Cas. 276; 2 Bl. Com. 336 ; 1 Prest. Est. 186; 1 Spence, Eq. Jur. 494; Fisher v. Fields, 10 Johns. 505.

31 Prest. Est. 190; Tud. Lead. Cas. 268; Doe v. Collier, 11 East, 377; Co. Lit. 290 b, n. 249, $ 6; 1 Eq. Cas. Abr..382; Harton v. Harton, 7 T. R. 653; Jones v. Bash, 4 Harring. I; Ayer v. Ayer, 16 Pick. 327, 330; Doe v. Biggs, 2 Taunt. 169.

* 2 Crabb, Real Prop. 509; Wms. Real Prop. 134 ; 1 Eq. Cas. Abr. 383; Hill, Trust. 232; 2 Sharsw. BI. Com. 335, n.; Willis, Trust. 21 ; Doe v. Homfray, 6 A. & E. 206. 6 i Spence, Eq. Jur. 496.

6 i Sand. Uses, 267. 7 + Kont, Com. 314.

8. Some of the same causes which operated to produce so general an application of uses before the statute, facilitated the introduction of the system of trusts. There were so many occasions when a necessity existed for creating fiduciary relations in respect to real pro

perty in order to effect the wants and wishes of its owners, [*164] while the common law afforded no adequate *means for pro

perly enforcing them, that there was a ready acquiescence in the action of the court of chancery when it practically resumed its jurisdiction over estates, through the persons and consciences of those who held them. This it did by recreating an equitable interest in real estate, distinct from the concurrent legal estate, after the very same exercise of jurisdiction had been solemnly denounced by. the legislature, and extinguished.

9. This was accomplished, as has already been stated, by discovering that there were cases of uses, which, because they could not be executed, were considered as not coming within the statute, and these included trusts of chattel estates in land. And when the courts of common law had determined that a use could not be exeouted upon a use, there was obviously no want of materials out of which to frame a system, for which these courts had already rules and precedents in the doctrine of uses in exercise before the statute, with which they were familiar. Among those who were the most active in building up, and giving form, symmetry, and consistency to the system of trusts, was Lord Nottingham, who was chancellor in 1675.3 Another class of uses which were held not to come within the statute, and were consequently seized upon by courts of equity in building up the system of trusts, were those which were implied. Thus where land was purchased in the name of one, but the consideration was paid by another, which was explained in a former chapter. And to these were soon added cases where the legal title to land was in one by fraud or accident, and the equitable claim to the same was in another, as where, for instance, one who had been intrusted with money by another to purchase for him an estate, should take the deed in his own name.5

2

8 2 Bl. Com. 336 ; Co. Lit. 290 b, note 249, 15; 1 Spence, Eq. Jur. 494 ; i i Spence, Eq. Jur. 491, 493.

Tyrrel's case, Dyer, 155. Wms. Real Prop. 134. • Ante, p. *101.

6 i Spence, Eq. Jur. 452, 467.

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