Overview

sub-trust


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N.

A trust created out of a trust such that A holds property on trust for B and B then declares himself to be trustee of his beneficial interest for C. If, in making such a declaration of trust, B has no duties to perform as trustee (because A continues to perform all such duties), then B will simply drop out of the picture leaving the original trustee, A, holding in trust for C (Grainge v Wilberforce (1889) 5 TLR 436). This is not a genuine example of a sub-trust. If B, however, by declaring the trust in favour of C, has some duty to perform in his capacity as trustee, then a genuine sub-trust will have been created and B will not drop out of the picture.

Subjects: Law.


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