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Property of any sort can be held on trust. The uses of trusts are many and
varied. Trusts can be created during a person's life (usually by a trust
instrument) or after death in a Will.
Creation
Trusts can be created by written document (express trusts) or they can be
created by implication (implied trusts).
Typically a trust is created by one of the following:
1. a written trust document created by the settlor and signed by both
the settlor and the trustees;
2. an oral declaration;[4]
3. the will of the settlor; or
4. a court order (for example in family proceedings).
In some jurisdictions certain types of assets cannot be the subject of a
trust without a written document.[5]
Formalities
Generally, a trust requires three certainties, as determined in *Knight v
Knight*:
1. *Intention*. There must be a clear intention to create a trust (*Re
Adams and the Kensington Vestry*)
2. *Subject Matter*. The property subject to the trust must be clearly
identified (*Palmer v Simmonds*). One cannot, for example, settle "the
majority of my estate", as the precise extent cannot be ascertained. Trust
property can be any form of property, be it real or personal, tangible or
intangible. It is often, for example, real estate, shares or cash.
3. *Objects*. The beneficiaries of the trust must be clearly
identified, or at least be ascertainable (*Re Hain's Settlement*). In
the case of discretionary trusts, where the trustees have power to decide
who the beneficiaries will be, the settlor must have described a clear
*class* of beneficiaries (*McPhail v Doulton*). Beneficiaries can
include people not born at the date of the trust (for example, "my future
grandchildren"). Alternatively, the object of a trust could be a charitable
purpose rather than specific beneficiaries.
