A Commitment Theory of Express Trusts

In this paper, we present a theory of express trusts as the embodiment of a legal form that enables a distinctive sort of commitment. We begin by exploring the importance of commitments in moral life guided by the value of autonomy before arguing that facilitative private law is normatively desirable in a liberal society to the extent that it enables individuals to make different sorts of commitment in the pursuit of purposes and goals. We then turn to express trusts, explaining how the commitment entailed in such trusts is distinctive when compared with the commitments entailed in contracts, fiduciary relationships and corporations. Whereas contracts and fiduciary relationships facilitate bilateral commitments between individuals, and corporations facilitate associative commitments amongst members or shareholders, express trusts facilitate the commitment of assets to stewardship. When disponers place assets in a trust, they commit them to a regime of governance in which individuals have no control but only the welfare of the trust in mind. This impersonal commitment ensures that the disponers’ objectives are immune to erosion by managers and beneficial owners of the trust assets at any moment. To the extent that express trusts enable this distinctive species of commitment, they are, from a liberal standpoint, to be welcomed in facilitative private law. Finally, we address the justificatory limits of a commitment theory of express trusts. We argue that a commitment theory calls into question some uses of express trusts. We also argue that external policy considerations properly limit the use of express trusts notwithstanding that such trusts are, prima facie, normatively attractive in light of a commitment theory.<br>