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Trust

Creation Of Express Trusts

To create an express trust, the settlor must own or have POWER OF ATTORNEY over the property that is to become the trust property or must have the power to create such property. The settlor must be legally competent to create a trust.

A trust cannot be created for an illegal purpose, such as to defraud creditors or to deprive a spouse of her rightful elective share. The purpose of a trust is considered illegal when it is aimed at accomplishing objectives contrary to public policy. For example, a trust provision that encourages DIVORCE, prevents a marriage, or violates the rule against perpetuities generally will not be enforced.

If the illegal provision pertains to the whole trust, the trust fails in its entirety. If, however, it does not affect the entire trust, only the illegal provision is stricken, and the trust is given effect without it.

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Law Library - American Law and Legal InformationFree Legal Encyclopedia: Tonnage tax to UmpireTrust - Basic Concepts, Private Trusts, Creation Of Express Trusts, Methods Of Creation, Protection Of Beneficiary's Interest From Creditors