In law a settlor is a person who settles property on

trust law A trust is a legal relationship in which the holder of a right gives it to another person or entity who must keep and use it solely for another's benefit. In the Anglo-American common law, the party who entrusts the right is known as the " sett ...

for the benefit of beneficiaries. In some legal systems, a settlor is also referred to as a trustor, or occasionally, a grantor or donor. Where the trust is a

testamentary trust A testamentary trust (sometimes referred to as a will trust or trust under will) is a trust which arises upon the death of the testator, and which is specified in their will. A will may contain more than one testamentary trust, and may address a ...

, the settlor is usually referred to as the

testator A testator () is a person who has written and executed a last will and testament that is in effect at the time of their death. It is any "person who makes a will."Gordon Brown, ''Administration of Wills, Trusts, and Estates'', 3d ed. (2003), p. 556 ...

. The settlor may also be the

trustee Trustee (or the holding of a trusteeship) is a legal term which, in its broadest sense, is a synonym for anyone in a position of trust and so can refer to any individual who holds property, authority, or a position of trust or responsibility to ...

of the trust (where he declares that he holds his own property on trusts) or a third party may be the trustee (where he transfers the property to the trustee on trusts). In the

common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omniprese ...

England and Wales England and Wales () is one of the three legal jurisdictions of the United Kingdom. It covers the constituent countries England and Wales and was formed by the Laws in Wales Acts 1535 and 1542. The substantive law of the jurisdiction is En ...

, it has been held, controversially, that where a trustee declares an intention to transfer trust property to a trust of which he is one of several trustees, that is a valid settlement notwithstanding the property is not vested in the other trustees. Capacity to be a trustee is generally co-extensive with the ability to hold and dispose of a legal or beneficial interest in property. In practice, special considerations arise only with respect to minors and mentally incapacitated persons. A settlor may create a trust by manifesting an intention to create it. In most countries no formalities are required to create an ''inter vivos'' trust over personal property, but there are often formalities associated with trusts over

real property In English common law, real property, real estate, immovable property or, solely in the US and Canada, realty, is land which is the property of some person and all structures (also called improvements or fixtures) integrated with or aff ...

, or

testamentary trusts A testator () is a person who has written and executed a last will and testament that is in effect at the time of their death. It is any "person who makes a will."Gordon Brown, ''Administration of Wills, Trusts, and Estates'', 3d ed. (2003), p. 556 ...

. The words or acts of the settlor must be sufficient to establish an intention that either another person or the settlor himself shall be trustee of the property on behalf of the beneficiary; a general intention to benefit another person on its own is sufficient. These formalities apply to express trusts only, and not to resulting, implied or

constructive trust A constructive trust is an equitable remedy imposed by a court to benefit a party that has been wrongfully deprived of its rights due to either a person obtaining or holding a legal property right which they should not possess due to unjust enr ...

s. For a settlor to validly create a trust, in most common law legal systems they must satisfy the three certainties, established in '' Knight v Knight'': #''certainty of intention'' – whether the settlor (or testator) has manifested an intention to create a trust. #''certainty of subject matter'' – whether the property identified as being settled is sufficiently accurately identified. #''certainty of objects'' – the beneficiaries must be clearly ascertainable within the

perpetuity period The rule against perpetuities is a legal rule in the American common law that prevents people from using legal instruments (usually a deed or a will) to exert control over the ownership of private property for a time long beyond the lives of peo ...

. Where a settlement of property on a third party trustee by a settlor fails, the property is usually said to be held on

resulting trust A resulting trust is an implied trust that comes into existence by operation of law, where property is transferred to someone who pays nothing for it; and then is implied to have held the property for benefit of another person. The trust property ...

s for the settlor. However, if a settlor validly transfers property to a third party, and the words used are held not to create a trust, the usual rule is that the donee takes the property absolutely.''Lassence v Tierney'' (1849) 1 Mac & Cr 551

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References

{{Reflist Equity (law) Legal terminology Property law Wills and trusts

See also

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