PRELIMINARY CHAPTER. BEFORE the relation of trustee can be constituted, there must necessarily exist: 1st, A subject-matter proper for a trust; 2nd, A person competent to create a trust; 3rd, One capable of holding property as trustee; and, 4th, A person for whose benefit the trustproperty may be held, who is known by the somewhat barbarous appellation of "cestui que trust." FIRST.-What may be the Subject-matter of a Trust. All property of a valuable nature, not only everything that may be legally transferred or disposed of, but also many things which the rules of common law do not recognize as available property, or at any rate do not permit to be dealt with by assignment; such as choses in action, and possibilities of every description, as well as mere naked powers and authorities, may be made the subject-matter of a trust (a). Although the courts of equity in England cannot in suits concerning Foreign prolands situated out of the limits of their jurisdiction make any decree perty real. directly affecting the realty (b), yet they will support a trust of such lands against a trustee resident within the jurisdiction by a decree operating in personam (c). Thus, questions involving trusts of real property in Ireland (d), in the Island of Sark (e), and the West Indies (ƒ), have been entertained by the Court of Chancery here; and it seems, that a similar jurisdiction would be exercised in the case of lands within the dominions of a foreign state (g). According to the law of England, and of almost every other country, And personal. personal property has no locality; but is subject to the law, which (a) 1 Cruis. Dig. Tit. 12 Ch. I.; Hobson v. Trevor, 2 P. Wms. 191; Wright v. Wright, 1 Ves. sen. 411. (b) E. of Kildare v. Eustace, 1 Vern. 421; Roberdeau v. Rous, 1 Atk. 543; Carteret v. Petty, 2 Sw. 323, n. (c) Penn v. Ld. Baltimore, 1 Ves. sen. Com. Dig. (Chancery), 3 X., 4 E., 454 4 W. 27. (d) E. of Kildare v. Eustace, 1 Vern. 182. (g) Angus v. Angus, 1 West, 23. Not property whose aliena tion is illegal, governs the person of the owner. It follows that the foreign personal property of a British subject may properly become the object of a trust, which will be recognized in this country (h). But no valid trust can be founded on an interest derived from an illegal contract, or established in contravention of the general policy or against pub- of the law (i). Thus, in the case of an officer's half-pay (k); or a lic policy. Copyholds. gaoler's fees (); or a right to property depending on the issue of a suit then pending (m); or any interest, the assignment of which is forbidden by the law on the ground of public policy (n); the court will not recognize any trust, which is attempted to be attached on a disposition of such property,-for such a trust would be in direct violation of those rules of law. Copyholds were not comprised in the Statute of Uses (o); but it has long been settled, that they may be subject to a trust; and the trust will be binding on the lord, if taken notice of on the court rolls (p). Previously however to the passing of the statute 4 & 5 Will. IV. c. 23, it seems, that copyholds would not have been bound by a trust, in case they had escheated to the lord by the failure or forfeiture of a trustee, where the admission of the trustee was expressed on the rolls to be absolute (q). But this distinction is done away with by that statute, which empowers the Court of Chancery, in all such cases, to enforce the execution of trusts of copyholds in favour of the parties beneficially interested. All persons, to the extent of their capacity, to convey. Persons non sui juris. Femes coverte. SECOND.-Who may create a Trustee. With regard to the capacity of creating a trustee, (independently of any power, conferred by a previous instrument, which will be the subject of future consideration,) it may be broadly stated, that every person, who is capable of making a valid disposition of property of any description, has also the power of attaching such limitations or declarations to the act of disposition, as will convert the person taking the legal estate into a trustee for the parties to whom the beneficial interest is given. The estate of the trustee, if created by persons not sui juris, will be valid only to the extent of their legal capacity to convey. Therefore an appointment by a feme coverte of a trustee of her real (h) Smith. Merc. Law, 567; Hill v. Reardon, 2 Russ. 608, 629. (i) Exp. Dyster, 1 Mer. 172; Curtis v. Perry, 6 Ves. 739; Exp. Houghton, 17 Ves. 251; Campbell v. Thompson, 2 Hare, 140. (k) Stone v. Lidderdale, 2 Anst. 533. (m) Stevens v. Bagwell, 15 Ves. 156. (n) Stone v. Lidderdale, ubi supra. (0) Gilb. Ten. 170; Co. Litt. 271, b., n. 1., VIII. (p) Burgess v. Wheate, 1 Ed. 232 ;. Weaver v. Maule, 2 R. & M. 97. (9) Att.-Gen. v. D. of Leeds, 2 M. & K. 343. H estate, must be executed with the formalities required by the recent act for the abolition of fines and recoveries.* So, where an infant makes over property to a person upon trusts, by Infants. any act of assurance, which is voidable only, and not void, the estate of the trustee will remain good, until the assurance be avoided (r). Although it might be a question, whether a resulting trust would not arise in such a case in favour of the infant (s). Previously to the statute 1 Vict. c. 26, an infant of the age of fourteen years might have appointed a trustee of personal estate by will (t); but now, by the 7th sect. of that act, it is declared, that no will, made by any person under the age of twenty-one years, shall be valid. mentis. A person non compos mentis, being in general incapable of disposing Persons non of his property by deed or contract, cannot appoint a trustee. But it compotes seems that a feoffment by such a person, with livery of seisin, cannot be avoided by him at law, although his heir may enter after his death (u). However, it is conceived, (from analogy to the case of a declaration of uses on a fine, levied by a person in a similar state of incapacity,) that no declaration of trusts on such a feoffment could be supported in equity, which in such a case would raise a resulting trust in favour of the feoffor. Previously to the statute for the abolition of fines and recoveries, if an infant, or an idiot, or lunatic, were permitted to levy a fine, or suffer a recovery, and he made a declaration of its uses, the estate so created would be good at law, until the fine or recovery were reversed (x). But in cases of that nature a court of equity would unquestionably interpose the doctrine of resulting trusts, and would relieve against the parties taking the legal estate, by treating them as trustees for the person making the conveyance (y). This, however, applies to the question of the creation of trustees by implication, which will be considered in a future place. Before the Statute of Uses the sovereign might have declared uses The sovereign. upon his letters patent (2). By common law, and also by the statute 39 & 40 Geo. III. c. 88, he has the power of disposing of his personal estate by will (a); and there can be little doubt, but that any declara (r) Co. Litt. 248, a.; Hearle v. Greenbank, 1 Ves. 304. (8) 4 Cruis. Dig. 130. (t) Hearle v. Greenbank, 1 Ves. sen. 303; Lew. Trust. 24. (u) Co. Litt. 247, b. (x) 2 Rep. 58, a. ; 4 Rep. 124; Bac. (y) 4 Cruis. Dig. 130; 5 ib. 253. *But a feme coverte, with respect to property settled to her separate use, is regarded in equity as a feme sole. She may therefore convey her equitable interest in such property, whether real (Major v. Lansley, 2 R. & M. 355) or personal, (Fettiplace v. Gorges, 1 Ves. sen. p. 46,) to trustees, for the benefit of herself or others, as effectually as if she were unmarried. Corporations. Aliens. Persons at son or felony, when? Of real estate. Of personal estate. tion of trust, made upon a valid legal transfer of property by the sovereign, would be capable of being enforced in a court of equity. Thus, the validity of a grant of the Deccan prize-money, by a warrant under the royal sign-manual to trustees for certain purposes, was not disputed in a recent case (b); although it was determined, that no definite right had been conferred by the warrant upon the cestuis que trusts, which could be enforced by them against the trustees.* In like manner all corporations of every description, subject to the restrictions imposed by the disabling statutes, have at law a general right of alienating their property (c): and their consequent power of appointing trustees, on any disposition made by them, is co-extensive with this right (d). No alien is capable of holding real property in this country (e). He has no ability to make a feoffment, grant, or lease (f); nor can he confer any legal or equitable right or interest in real estate by contract, or other disposition. An alien enemy, unless residing in this country with the king's license express or implied, is equally incapable of holding or disposing of any personal property. But an alien friend may acquire property in goods, money, and other personal estate, except chattels real, with the same powers of disposition, as a British subject. He may therefore convey such property upon trusts, either by act inter vivos, or by will (g). Attainder for treason or felony works a forfeiture of the real estate of the offending party, which has relation backwards to the time when the act was committed (h); and it would therefore invalidate any conveyance upon trusts, made by the attainted party subsequently to the commission of the crime. However, by the statute 54 Geo. III. c. 145, "no attainder for felony, except high treason, petit treason, or murder, shall extend to the disinheriting any heir, nor to the prejudice of any other person than the offender himself during his life." It follows therefore, that a bona fide conveyance upon trusts by an attainted person who comes within the operation of that act, would be supported to the extent of any interest given after his decease. The forfeiture of goods and chattels takes effect on the conviction of the party of treason or felony, and has no relation backwards: (b) Alexander v. D. of Wellington, 1 R. & M. 35; vide et Stevens v. Bagwell, 15 Ves. 152. (c) Mayor of Colchester v. Lowten, 1 V. & B. 226. (d) Att.-Gen. v. Aspinall, 2 M. & Cr. 613; Att.-Gen. v. Wilson, 1 Cr. & Ph. 1. (e) Com. Dig. (Alien), C. 4; 1 Bl.Com.371. (f) Co. Litt. 42, b. (g) Com. Dig. (Alien), C. 5, 7; 1 Bl. Com. 372. (h) 4 Bl. Com. 380. *By the statute 39 & 40 Geo. III. c. 88, the sovereign is authorized to grant trust property, which has escheated to the crown, to trustees, for the purpose of executing the trusts. therefore a traitor or felon may, if bonâ fide and for a good consideration, convey his personal property to trustees for other persons at any time before his conviction. But if the transaction be collusive, the law, and particularly the statute 13 Eliz. c. 5, will reach them, and recover them for the king (i). Outlaws also, though it be but for debt, are incapable during their Outlaws. outlawry, of appointing trustees of their personal property by act inter vivos or will (k); for their goods and chattels are forfeited during that time. By the operation of the Bankruptcy Acts (1), the whole present Bankrupts. property of a bankrupt, as well as what he may acquire before obtaining his certificate, becomes ipso facto vested in his assignees by virtue of their appointment. An uncertificated bankrupt is therefore disabled from passing any interest in property, to any other person, either as trustee or otherwise. However it seems that his right to his allowance, and the surplus of his estate, is an interest that remains vested in him with all the incidents of property (m). It follows, that a bankrupt may make a valid disposition of such an interest, either upon trusts or otherwise. By the recent act for abolishing arrest on mesne process (1 & 2 Insolvents. Vict. c. 110, s. 27), the order of the Insolvent Court made upon the petition of a prisoner, has the effect of vesting in the provisional assignee the whole real and personal estate of the insolvent, either present, or what he may acquire before he becomes entitled to his final discharge. An insolvent therefore, subsequently to such an order, is equally incapacitated with an uncertificated bankrupt from conveying property to a trustee. THIRD.-Who may be a Trustee. There is no equitable doctrine more firmly established, than that a Who may be a trust, once properly created, shall never fail on account of the death, trustee. disability, or non-appointment, of the trustee. The court will in all cases follow the subject-matter of a trust into the hands of the holder, unless he be a purchaser for valuable consideration without notice, and treat him as a trustee (n). However it very rarely happens, that a trust is declared, without a contemporaneous appointment of a trustee for its execution, who, unless otherwise incapacitated, will take the legal interest in the pro (i) 4 Bl. Com. 387; Perkins v. Bradley, 1 Hare, 219. (*) 2 Bl. Com. 499; and see Att.-Gen. v. Rickards, 8 Jurist, 230. (1) 6 Geo. IV. c. 16, ss. 63 to 68; 1 & 2 Will. IV. c. 56, ss. 25 and 26. (m) Ex parte Safford, 2 Gl. & J. 128. (n) Att.-Gen. v. Downing, Amb. 550; Bennet v. Davis, 2 P. Wms. 316; Souley v. Clock-Makers' Company, 1 Br. C. C. 81; Sand. Us. 349; 2 Fonbl. Eq. 142, n.; 1 Madd. Ch. Pr. 580; Co. Litt. 113, a., n. 2 and ib. 290, b. n. 1, VI. |