Equity and Trusts: Examining Trust Structures and Applications

This report delves into the definition and applications of trusts within the framework of property law, specifically in the UK context. It explains the nature of a trust as a fiduciary relationship involving a trustor, trustee, and beneficiary, outlining the duties of the trustee to manage property for the benefit of the beneficiary. The report highlights the legal ownership of the trustee and the equitable ownership of the beneficiary. It further explores the various applications of trusts, including wealth preservation, family property arrangements, and charitable purposes, referencing relevant case law such as McKenzie v. McKenzie and academic sources like Davies, Penner, Hudson, and Watt. The report emphasizes the importance of trusts in safeguarding family assets and promoting public welfare, providing a comprehensive overview of trust structures and their significance in legal and financial contexts.

Running head: EQUITY AND TRUSTS
Equity and Trust
Name of the Student
Name of the University
Author Note

1EQUITY AND TRUSTS
Trust is one of the creations of the property laws prevailing in the United Kingdom. It
depicts a fiduciary relationship existing between three parties. In this system, trustor makes a
transfer of a property upon the trustee, who needs to administrate property for the benefits of
a third party namely the beneficiary. In this form of arrangements, the legal owner pertaining
to the property is the trustee1. The beneficiary of the trust is regarded as the equitable owner
pertaining to the same. The trustees are conferred with a fiduciary duty to ensure the
transactions relating to the trust property to be in favour of the equitable owners. A trustee
can be any natural person, business entity or even a public body. All the actions taken by the
trustee with respect to the trust property need to ensure that the maximum welfare of the
beneficiary2.
Trust is a widely used arrangement with respect to property law. It has many applications
in in property law as well as in company law. One of the most popular application of trust is
the preservation of the wealth pertaining to a family. It protects the family properties from
being alienated. In case of family breakdowns, trust properties can be created for the purpose
of determining the rights of the parties jointly owning a property. This can be illustrated with
the case of McKenzie v. McKenzie 349 Mich. 18, 84 N.W.2d 3333. The value of a trust can
also be found in the promotion with respect to security as well as financial purposes. Another
important application of trusts are the voluntary activities where search in charitable trusts are
created with intention to uplift public welfare4.
1 Watt, Gary. Trusts and equity. Oxford University Press, 2018.
2 Hudson, Alastair. Understanding equity & trusts. Routledge, 2016.
3 McKenzie v. McKenzie 349 Mich. 18, 84 N.W.2d 333
4 Davies, Paul S., and James Penner, eds. Equity, Trusts and Commerce. Bloomsbury Publishing, 2017.

2EQUITY AND TRUSTS
Reference
Davies, Paul S., and James Penner, eds. Equity, Trusts and Commerce. Bloomsbury
Publishing, 2017.
Hudson, Alastair. Understanding equity & trusts. Routledge, 2016.
McKenzie v. McKenzie 349 Mich. 18, 84 N.W.2d 333
Watt, Gary. Trusts and equity. Oxford University Press, 2018.