the purpose of the institution," if they were banks, for example, would be very narrow. One or more of the beneficiaries of an estate may be appointed as trustees. For example, a will may leave the entire estate or income from an estate to four surviving heirs, the principal to be divided among their heirs; and all four may be named as executors and trustees. Unincorporated associations may hold trusts for charitable purposes in every state except New York and Virginia.1 There is no obligation upon anyone to accept an appointment as trustee. He may refuse and has the right to do so; but once he has accepted the office "either expressly or by implication, it is conclusive; and he cannot afterwards, by disclaimer or renunciation, avoid the duties and responsibilities." 2 Anyone who is capable of receiving property may be a cestui que trust; and in the case of trusts for charitable purposes the beneficiary does not have to be capable of taking the legal title.3 Also voluntary associations, societies, clubs, etc., may be cestuis que trustent, although at common law they cannot take legal title to real property. The Subject Matter of a Trust. Every kind of real or personal property that can be assigned at law may be the subject matter of a trust. Furthermore, every kind of vested right which the law recognizes as valuable may be transferred in trust, such as a patent, a trade secret, etc.5 That which is held in trust is called the trust property, or the trust estate. 6 The Rule Against Perpetuities. The law will not permit a perpetual trust, under the so-called "rule against perpetuities." A perpetuity is defined as an inalienable, indestructible estate 7 1 Conyngton, Wills, Estates & Trusts, p. 381. 2 Perry on Trusts, p. 249. 3 Ibid., pp. 35-8. Conyngton, op. cit., p. 383. Perry on Trusts, p. 38. This is generally called the "rule against perpetuities" but it has been said that it should be called the rule against remoteness. Cf. Gray, The Rule Against Perpetuities (1886). 7 Gray, The Rule Against Perpetuities, p. 91. -one that cannot be alienated, "though all mankind should join in the conveyance." 1 When a person has built up a large estate it may be a source of annoyance to him to realize that perhaps his sons or his children's sons or daughters will squander it, and he would like to make it impossible for them thus to ruin themselves. Under this rule against perpetuities, he can do this only to a limited extent. As now broadly stated, the rule is that "no estate can be held from alienation for longer than a life or lives in being and twenty-one years after, and in case of a posthumous child, who would inherit, at most nine months longer. At the end of the period limited, the heir or heirs who take may alienate or mortgage or dispose of the estate at their pleasure." 2 Thus under this rule, one could not vest title in his estate to a trust company in trust for his heirs forever. It is considered that it would be a bad thing for mankind to hinder the free alienation of property, thus undermining commerce; and that it is not good for families to be kept wealthy after they have lost their ability to care for their wealth. Such a practice would be a tremendous influence towards the formation of caste and result in social instability. Summary. Thus two broad types of trust are distinguished: first, trusts where the trust property is under the control of the trustee; and second, trusts where the trust property is not directly under the control of the trustee. There are three parties to a trust: first, the donor, grantor, or settlor, who creates the trust; second, the trustee, who has the legal title; and third, the cestui que trust or beneficiary, to whom the equitable estate belongs. Trusts may be classified according to two or three different bases: (1) According to whether trustor is natural or artificial into a.-Personal trusts (by a natural person). b. Corporate trusts (by an artificial person or corporation). 1Quoted from Scattergood v. Edge, Salk. 229, by Perry on Trusts, p. 345. 'Conyngton, Wills, Estates and Trusts, pp. 374–5. (2) According to the condition of the person by whom the trust is made: a.-Testamentary trust. b.-Living, or voluntary trust. c.-Court trust. (3) According to the way in which it is created: a.-Express trusts. i. simple implied trusts. Under the law there are certain qualifications required of grantor, trustee and cestui que trust; but the law is particularly observant in the case of the trustee-requiring not only that he be legally qualified but that he also be capable of executing the trust. CHAPTER IV TRUST SERVICES FOR INDIVIDUALS An outline of the trust services which a trust company performs for individuals has been presented at the end of Chapter II, and it was indicated that certain kinds of trusts are by their nature related to individuals only; other kinds of trusts are by their nature related only to corporations, whereas certain trusts may be undertaken for either corporations or individuals. It is the purpose of the present chapter to discuss those trusts which are related to individuals only. Executorships and Administratorships. An executor is a fiduciary who is appointed in a will to carry out the terms of the will. The person or corporation who is appointed to do this is called the executor of the will. If the will provides for a simple distribution of the estate, the services of the executor will be required only for a period of time necessary to assemble the assets of the estate, take care of all claims against the estate, and make the distribution specified in the will. This period of time may vary from ten months to possibly two years, depending upon the circumstances of the case, and the laws of the states with regard to the time limit allowed creditors to make their claims. The Trust Company as Executor of the Will. The old-fashioned way of looking upon an executor of the will was to consider it an office in behalf of the dead, to carry out the wishes of the dead with reference to an estate of the dead. As a matter of fact it is quite natural that the office should have been so regarded under the conditions which existed formerly, where those who took the office did so for the most part as an avocation and their interest in the matter began upon the death of the testator. But under modern conditions, with the advent of the trust company which specializes in such work, builds up an organization for its proper execution, and further, with the increasing complication of the service, an entirely different conception of the fiduciary has evolved. It has come to be looked upon as a service for the living. The trust company becomes a specialist in this very thing, and it seeks the appointments. As a natural result of their efforts to receive appointments to the office, they seek the friendship and respect of the living; and it is urged and should be urged that the making of a will is not something to be done in contemplation of death, but is simply the statement of a plan for the future, put in writing in case it should happen that the author dies, and an executor and trustee named to carry out the plan in case such death takes place. During the lifetime of the individual the trust company coöperates with the individual in many ways, to carry out his financial plan by offering other services. There are two distinct problems in connection with every man's plan for the future of his estate, or his so-called "last will and testament"; the first problem is the plan as to what he wants to accomplish, and how it can be accomplished so far as the economics of the situation is concerned, and the second problem is the question of the legality of what he wants or how it can be most nearly accomplished in accordance with the law. The first problem may be referred to as the problem of administration, and the second one as the problem of law. It is only with reference to the first problem that the trust company may be of assistance the problem of law must be handled by lawyers. Lawyers are equipped to handle the legal aspect of the plan, and it is within their province to do so. On the other hand, trust companies are better equipped to handle the administrative part of the plan and to deal with the economic questions than are the specialists at law. It is against the law in a number of states for trust companies to practice law, and even where a specific law does not exist the courts would condemn the practice. It is true that a good lawyer, if he has a reasonable knowledge of business matters and economics, is the ideal type of person to appoint as an executor; but if a lawyer is a good one, he can make more money in the practice of law than he can settling estates. As a matter of fact it is a usual thing in some of the large cities for lawyers who have |