CHAPTER 20 Trusts

• Date: 07 April 2025

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CHA PTER 20

TRUSTS

A. INTRODUCTION

In general terms, a trust is an equitable obligation under which a trustee

holds property for the benef‌it of a benef‌iciary. The three main types of

trusts are express, constructive and resulting. The second and third ofthese

types tend to arise by operation of law and can be seen as partof the law

of remedies. Accordingly, the law applicable to constructive and resulting

trusts is usually the law under which they are held to exist — in other

words, the law applicable to the substantive obligation giving rise to the

trust. In contrast, express trusts arise as a result of intentional acts taken

by a person to create the trust. They are not remedies, arising in response

to some situation: they are legal arrangements usually based on consent.

This chapter considers the law applicable to express trusts. An express trust

can be either a testamentary trust, created by a testator or testatrix on death

using a will, or an inter vivos trust, created by a settlor during his or her life.

The Hague Conference on Private International Law has been active

in the area of choice of law for trusts. In 1985 it drafted the Convention on

the Law Applicable to Trusts and on Their Recognition and the convention

came into force in 1992.1 The convention has been ratif‌ied by fewer than

twenty countries including Australia, Canada and the United Kingdom.2

1 23 ILM 1388 (1984) [Hague Convention]. See the Explanatory Report on the con-

vention by Alfred von Overbeck at 25 ILM 593 (1986). A very useful resource on

the convention is Jonathan Harris, The Hague Trusts Convention: Scope, Application

and Preliminary Issues (Oxford: Hart Publishing, 2002).

2 It is useful to review the United Kingdom’s jurisprudence on the convention,

especially in the absence of Canadian authority. See Lawrence Collins & Jonathan