In the early 1500s, landowners in England found it advantageous to transfer legal ownership of the land to a third party while retaining the benefits of ownership. Because they are not the real owners of land and their wealth is mainly measured by the number of land they own, they are not bound by creditors and may be exempt from certain feudal obligations. Although feudalism was no longer a problem, and wealth was held in forms other than land (i.e. stocks, bonds, bank accounts), the idea of handing over property to a third party to benefit others survived and prospered. That’s the idea of trust.
Generally, trust refers to the property right (real estate or individual) held by one party in a trust relationship for the benefit of the other party. The trustee is the person who has the ownership of the trust property, and the beneficiary is the person who obtains the trust interest. To understand the law governing trust, a good starting point is restatement of trust (Article 2).
Many trusts have been established as alternatives or combinations of wills and other elements in estate planning. State law establishes a framework for determining the validity and limitations of both.
The uniform probate act makes state law in this area. It includes provisions dealing with the affairs and estate of the deceased, as well as laws dealing with specific non testamentary transfers, such as trusts and their administration The theory behind the code is that there is a close link between will and trust, and that there is a need for unity. Since its establishment, more than 30% of the states have basically adopted the code completely.
Because many people neither establish trust nor execute will, the national intestate succession law is an important supplement to trust law and property law. They determine where personal assets die without a will.