Vol. 12 · pages 351–355

CHAPTER II (i) The Creation of an Express Trust I. CONDITIONS FOR THE CREATION OF A VALID TRUST. For the validity of a declared Trust the following four conditions prescribed by law must be satisfied. (i) Section 6. (1) There must be necessary parties to the trust. (2) The language of the settlor must be such that the Court can find from it, as a fact, (a) an intention to create a trust; (b) of ascertainable property ; (c) in favour of ascertainable beneficiaries and (d) for an ascertainable purpose. (ii) Sections 7-8. The trust property must be of such a nature as to be capable of being transferred and settled in trust. (iii) Section 4. The object of the trust must be lawful. 2. The English Law of Trust differs from the Indian Law in regard to the creation of a trust. According to Snell the creation of a trust requires three certainties, (i) Certainty as to intention. (ii) Certainty as to trust property. (iii) Certainty as to beneficiary. According to Underhill the creation of a trust requires four certainties, those mentioned by Snell and one more namely. (iv) The purpose of the trust. The English Law does not require the transfer of the trust property to the trustee. But the Indian Law does.

331THE LAW OF TRUST (ii) Certainty as to intention (i) The intention to create a trust may be by words or acts. (ii) These are illustrations which show how a trust could be created by the acts of the author of the trust. Illus. (i) A father opening an account in his book in the name of his son in which money is credited in the name of his son. 9 Bom. 125 (ii) A buying shares in 5 Bom. 268 17 Col. 620 (628) 3. Examples of trust created by words are unnecessary. The question is what kind of language is necessary to show there is a certainty to show that there was intention to create a trust— (i) No technical expressions are needed for the creation of a trust The matter is one of construction. The question, therefore, which has to be determined is whether upon construction of the will or deed as a whole, the testator intended that the person to whom property was given should take as a mere trustee or should take beneficially, subject to a mere superadded expression of a wish or desire, which the testator may have thought would be sufficient to influence the donee, but which was not intended to and does not impose upon him any obligation. Question is did the author of the trust merely express a wish that the trustee should do a particular thing or did he impose an obligation upon him to do a certain thing. If an obligation was in fact intended then obviously he had the intention to create a trust. (iii) The language used may be either precatory or imperative. (i) The words request, recommend, desire, hope, etc., are precatory words. (ii) Such words cannot be said to indicate an intention to create a trust, because they do not show an intention to impose an obligation upon the trustee. (iii) Under the English Law such precatory words were held to constitute a trust and the trusts were called precatory trust. But the modern tendency is against. (iii) Certainty as to beneficiary 1. The beneficiary must be specified or described sufficiently as to be capable of identification.

332 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES 2. Illustrations of uncertainty. (i) Estate given to A with the direction that he would continue it in the family—family uncertain. (ii) To the settlor’s relations—relations uncertain. 3. Illustrations of sufficient description (i) Descendents-held to be sufficient description and therefore not uncertain 3. Certainty of Purpose 1. How the property is to be applied must be specified. 2. Illustrations of uncertainty of purpose. (i) To consider certain persons. (ii) To be kind to them. (iii) To make ample provision for them. (iv) To remember them. (v) To do justice to them. (vi) To take care of his nephew as might seem best in future. (vii) To use property for herself and her children and to remember the Church of God and the poor. 3. The purpose of the trust means the way in which the beneficiaries are to be benefitted the way in which the property is to be applied. 4. Certainty as to trust property 1. The property which is to be the subject-matter of the trust must be indicated with reasonable certainty. It must be specified or sufficiently described so as to be capable of identification. Illus. (i) A bequeathes certain property to B—directing him to divide the bulk of it among the children of C. There is no creation of a trust because the property is not indicated with reasonable certainty. (ii) A gives property in trust for his wife and directs that such part of it as may not be required by her shall, after her death, be held in trust for his children. (iii) A gives property in trust for his servants with a direction to reward them according to their deserts out of such parts of my estate as may not have been sold or disposed of by her.

333THE LAW OF TRUST Conclusion 1. Thus, it must be clear that the settlor intended to create a definite trust over definite property for definite persons. No trust can arise in the absence of an intent to create a definite equitable obligation giving definite equitable rights to definite beneficiaries. 2. It will, however, be noticed that the failure to nominate a definite person as a trustee does not invalidate the trust. Where a trust is clearly intended, then (subject to the rules as to voluntary trust), the mere omission to appoint a trustee will not invalidate the trust: for equity never allows a trust to fail for want of a trustee. So, if no trustee is appointed or if the trustee appointed fails, either by death, or disclaimed or incapacity or otherwise the trust does not fail, but fastens upon the conscience of any person (other than a purchaser for value without notice) into whose hands the property comes and such person holds it as a passive trustee, whose only duty is to convey it to new trustees when properly appointed. 3. The effect of uncertainty as to property or as to beneficiary or purpose of the trust is different: (i) Where the trust is affected by uncertainty as to property the trust is void. As there is no property capable of identification there is nothing to litigate about. (ii) Where the trust is affected by uncertainty as to the beneficiary or the purpose the trust is void. As there is no person named as a beneficiary no one can come forward to enforce it. (iii) Where the property is described with sufficient certainty, and the words actually used, or the surrounding circumstances make it clear that although the donor has not sufficiently specified. The objects of his bounty or the way in which the property was intended to be dealt with yet he never meant the trustee to take the entire beneficial interest, the Law implies a resulting trust in favour of the donor or his representative. II. TRUST PROPERTY MUST BE CAPABLE OF TRANSFER. 1. What property is capable of transfer ? 2. The answer to this question is to be found in section 6 of the Transfer of Property Act. 3. Property which can be transferred may be subject-matter of a trust.

334 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES 4. But there can be no trust of a beneficial interest under a subsisting trust. A Beneficiary cannot create a trust of his interest in trust. His interest is transferable but he cannot create a trust of it. 5. This marks an important distinction between the English Law and Indian Law of Trust. 6. Under the English Law a beneficiary can create a trust of his equitable estate. 7. The reason is that the Indian Law does not recognize the distinction between legal and equitable estates in a trust. Sec. II.— A Trust may be properly created and yet enforceable. 1. A trust may have been properly created but may not be enforceable. To be enforceable a trust must satisfy two other conditions:— I. The object of the Trust must not be unlawful. II. The formalities prescribed for the creation of a trust must be satisfied. Object of the trust Sec. 4. 1. The object of a trust must be lawful. 2. What are lawful objects ? (1) The purpose must not have been forbidden by Law. (2) Purpose must not be such which if permitted would defeat the provisions of any law. What are unlawful objects ? (1) Purpose which is fraudulent (2) Purpose which involves or implies injury to the person or property of another. (3) Purpose which is immoral or opposed to public policy. Illus. (1) Trust for the care of female foundings to be trained as prostitutes. (2) Trust to carry on smuggling business and to maintain it out of the profits. (3) Trust by a person in insolvent circumstances—defeating creditors. (4) Trusts for illegitimate children.