Sep 15, 2021
In the above example, A is called the “trustor”, Bank 1 the “trustee”, and B the “beneficiary” according to the Trust Law. The agreement between Bank 1 and A is a “deed of trust” and the “duration of trust” is ten years. The amount under the special account (one million dollars plus interest) is the “trust property”. It can be seen that the fiduciary relationship is roughly composed of the rights and obligations of the three parties (the trustor, the trustee, and the beneficiary) and the legal acts that create fiduciary relationships are collectively referred to as “trust acts”. For example, the deed of trust above is a type of trust act. As far as the establishment of the trust relationship is concerned, once the trust property is transferred to the trustee in accordance with the trust deed, the fiduciary relationship is formed. As for its effect, once the fiduciary relationship is established, the ownership of the trust property in Anglo-American law is divided into “nominal ownership” and “substantial ownership”, which will be detailed in the third section on the characteristics of the trust.
To put it simply, the fiduciary relationship is the transfer of the property by the trustor, the management of the sanction by the trustee, and the beneficiary’s pure benefit. So far, we can see the two major functions of the trust: property transfer (the trustor wants to transfer some property to the beneficiary), and property management (the trustor hopes that the trustee will manage the property during the duration of the trust).