Which statement best defines an express trust?

Which statement best defines an express trust?

• A. A trust created intentionally by the settlor with a clear intention, property, beneficiaries or purpose, and a valid instrument
• B. A trust created automatically by law
• C. A trust created only by court order
• D. A trust that exists only for charities

Answer: (A)

An express trust is formed when the person who owns property (the settlor) actively declares that the property should be held by someone else for the benefit of identified beneficiaries or for a defined purpose, and this arrangement is set out in a valid instrument such as a trust deed or will. The key is explicit intention plus clearly defined property and beneficiaries or purpose, all documented in a formal instrument. This distinguishes it from trusts that arise automatically by law, which are not based on the settlor’s declared plan; or from trusts created only by court order, which are imposed by a judge rather than declared by the settlor. Charitable trusts are a type of express trust, but the essential definition centers on the settlor’s explicit declaration with a valid instrument, not merely the charitable status.

An express trust is formed when the person who owns property (the settlor) actively declares that the property should be held by someone else for the benefit of identified beneficiaries or for a defined purpose, and this arrangement is set out in a valid instrument such as a trust deed or will. The key is explicit intention plus clearly defined property and beneficiaries or purpose, all documented in a formal instrument. This distinguishes it from trusts that arise automatically by law, which are not based on the settlor’s declared plan; or from trusts created only by court order, which are imposed by a judge rather than declared by the settlor. Charitable trusts are a type of express trust, but the essential definition centers on the settlor’s explicit declaration with a valid instrument, not merely the charitable status.