Resulting Trusts

• Author: Eileen E. Gillese, Martha Milczynski
• Pages: 101-112

CHAP TER 6

RESULTING TRUSTS

A. INT RODUCTION

The resulting trust, like the constructive trust, ari ses by operation of

law. It occurs when the legal owner of property is found to hold the

property for the benef‌it of the donor. Unlike the constructive trust,

however, the resulting trust i s a static legal concept; the scope of its op-

eration is limited and the courts appear unwilling or unable to expand

its application outside of three situations:

1. Where a trustee holds property under the terms of an expre ss trust

and the trust fa ils in whole or in part. In th is case, a resulting trust

may be said to be a consequence of the failed express trust.

2. Where A purchases propert y and title is taken in the name of B, or,

jointly, in the names of both A and B.

3. Where A voluntar ily and gratuitously transfers property into the

name of B, or into the joint names of Aand B.

At various times, t he concept of resulting trust has been unsuc-

cessfully invoked as a me ans of resolving new t ypes of legal problems.

The most recent example can be found in the area of pension tr usts.

The resulting trust concept was urged upon the courts as a mean s of

determining entitlement to pension fund surpluses. The argument was

made primar ily by those representi ng employers and ran along these

lines: when an employer created a pension plan, it placed f unds in trust

to ensure that it could pay the promised pension benef‌its; when the

pension plan was wound up, if there were asset s in excess of those

101