Common-Law Trust/Unincorporated Business Trust Organization Asset Protection Remedy (protect assets) T e secret o!

wea"t is contro"# not owners ip$ % en &assie L$ &unt# a !amous oi"man o! 'a""as# Te(as# died as t e wor"d)s ric est man# t e on"y asset e owned in is own name was a *+,- C e.ro"et pic/up truc/ wort a0out 12#344$ 5&is5 tota" wort cou"d on"y 0e estimated as it was ne.er disc"osed (t e Octo0er 3# *+,3# issue o! t e 'a""as 6orning 7ews reported 5guesstimates5 w ic ranged 0etween 12 0i""ion and 18 0i""ion do""ars)$ T e 9edera" :i!t and ;state Ta( in *+,- too/ ,,< o! persona" property .a"ued in e(cess o! 1*4 mi""ion do""ars= t e >R? wou"d a.e co""ected 12#@42#@44#444 (0ased on 1@ 0i""ion do""ar estate) i! &unt ad owned t e wea"t imse"!$ &e did not= e mere"y contro""ed it t roug numerous trust !unds$ Co"umnist Aac/ Anderson as noted= 5Bice President 7e"son Roc/e!e""er $ $ $ paid no income ta( in *+,4$ &is 0rot er# Ao n '$ Roc/e!e""er >>># pays a *4< !edera" ta( as a matter o! persona" princip"e $ $ $ $ Pau" 6e""on# wort a coo" one 0i""ion do""ars# is a0"e to get away wit neg"igi0"e income ta(# as do ot er mem0ers o! is !a0u"ous"y ric !ami"y$ And Te(as oi" mi""ionaire Bun/er &unt as managed to "i.e in "u(ury wit out paying any ta(es at a"" in se.era" years$ T ey a.e made use o! t e "aw$ >t is t e process t at $ $ $ ma/es a c ump out o! t e person w o does not distort is a!!airs $ $ 5 T ere is no need to 5distort5 oneCs a!!airs= mere"y arrange t em proper"y$ 'o not .io"ate t e "aw= ma/e use o! t e "aw$ T e secret o! t e ?uper Ric seems to 0e in t e manner in w ic wea"t is con.eyed to a specia" /ind o! trust t at# instead o! mere"y o"ding t e property# actua""y owns t e property$ T us t e ?uper %ea"t y# enDoying opu"ent and "a.is "i!esty"es# are a0"e to "i.e and die as Paupers# 0ut wit t eir !ami"yCs 0"essingE A"" trusts are not created eFua""y Git goes wit out statement t at a"" trusts are not created proper"yH$ T ere are 0asica""y two great c"asses o! trustsI statutory trusts and common "aw trusts$ T e more popu"ar and wide"y used statutory trust deri.es its e(istence and is de!ined# go.erned# and regu"ated 0y statutes to w ic it must strict"y con!orm$ A common "aw trust arises !rom contract under common "aw# t e rig t to w ic as 0een secured 0y t e Constitution and esta0"is ed and up e"d 0y t e courts$ T e 5secret5 common "aw trust uti"ized 0y t e ?uper Ric is un/nown to many$ 9isca" secrecy# pri.acy# is t e a""mar/ o! t e common "aw 0usiness trust# and !ar !rom 0eing i""ega"= it acts as a means to ena0"e t e !ree0orn to e(ercise is "aw!u" rig t to pri.acy$ % i"e a 5'ec"aration o! Trust5 and certain 5credentia"s5 may 0e made a matter open to pu0"ic scrutiny# t e actua" contents o! t e trust contract and re"ated documents need not 0e disc"osed$ T e pri.acy permitted t e a!!airs o! t e trust is per aps its greatest !eature$ 9ai"ure to e(ercise oneCs rig t to pri.acy is per aps oneCs greatest mista/e$ Lawyers) study and practice "aw# w ic # !or t e most part# in.o".es statutory "aw$ ?ince t e common "aw unincorporated 0usiness trust organization (UBTO) e(ists and operates apart !rom t e Durisdiction o! statutory "aw# it escapes t e primary attention o! t e "ega" pro!essiona"s$ 'o not e(pect t e "ega" pro!ession to promote UBTOCs$ Lawyers are not as monetari"y ad.antaged as t ey are wit wi""s and trusts$ %i""s and statutory trusts are sometimes re!erred to as an attorneyCs 5retirement p"an#5 w ere0y an attorney as imse"! named as t e administrator and/or e(ecutor o! t e estate$ >t is said t at attorneys may se"" or ot erwise dispose o! t eir wi""s and trusts to ot er attorneys 0y t e "inear !oot$ 7o attempt is made to suggest or imp"y t at attorneys a.e no /now"edge o! common "aw or# in particu"ar# o! t e common "aw unincorporated 0usiness trust organization$ 7eit er is it suggested t at one cou"d not consider t e ad.ice o! a competent attorney !or assistance in t e preparation and/or e.a"uation o! a UBTO$ >t is not t at wi""s and statutory trusts a.e no .a"ue$ A wi"" is 0etter t an not ing$ A statutory trust# a"so /nown as an 5inter .i.os trust#5 5"i.ing trust5 or 5"o.ing trust#5 as as its primary 0ene!it t e a.oidance o! pro0ate and in eritance ta(es# and i! no 0usiness interests are desired or contemp"ated# a statutory trust is per aps t e pre!erred instrument$ A common "aw trust organization as a"" t e ad.antages o! a wi"" and a

trust p"us additiona" 0ene!its and !eatures not possi0"e ot erwise$ ?e.era" 0asic comparisons o! t e di!!erences 0etween a statutory 5"i.ing5 trust and a common "aw 5pure trust5 organization !o""owsI A ?tatutory Trust= *) 6ere"y o"ds property unti" deat 2) >s usua""y re.oca0"e @) &as a statutory termination date -) Protects# conser.es property 3) Arises !rom statutory pro.isions J) ?p"its "ega" and eFuity tit"e ,) 7o consideration in.o".ed 8) ;(ercise o! a pri.i"ege Common Law Trust= *) Owns property in 5!ee simp"e5 2) >s a"ways irre.oca0"e @) Cannot 0e terminated 0y statute -) Business moti.ation 3) Arises !rom t e "aw o! contract J) Lega" and eFuity tit"e not sp"it ,) Consideration in.o".ed 8) ;(ercise o! a rig t T e 5secret5 trust o! t e ?uper %ea"t y is common"y /nown 0y se.era" namesI 6assac usetts Trust# Pure Trust# True Trust# Unit Trust# B"ind Trust# Common Law Trust (CLT)# Contract Trust# Business Trust# Unincorporated Business Organization (UBO)# to name a !ew$ >t is important# owe.er# t at certain !eatures and nomenc"ature 0e used in order to pre.ent t is entity !rom 0ecoming su0Dect to statutory Durisdiction$ Trusts t at purport to 0e CLTCs# 0ut w ic identi!y t e trustor as 5grantor#5 e.en i! irre.oca0"e# may 0e disa""owed as a 0usiness trust 0ecause a uni"atera" granting or gi!ting o! assets into t e trust occurs to create t e trust rat er t an t e e(ecution o! a contract$ A CLT t at does not contain# in t e contract/indenture creating t e CLT# a pro.ision pro i0iting t e Certi!icate &o"ders !rom managing# contro""ing# or ot erwise directing t e a!!airs o! t e trust and its assets# 0ecomes an 5associated5 CLT and is considered t e same as a corporation or partners ip !or ta( purposes$ T ere!ore# it is essentia" t at t e CLT remain 5pure5 and 5non-associated5 0y e(press"y not a""owing t e Certi!icate &o"ders to a.e any power or rig t to manage or contro" t e assets owned 0y t e trust$ T e Certi!icate &o"ders are not .ested wit t e rig t or power to direct t e a!!airs o! t e trust= t ey are simp"y entit"ed to recei.e dis0ursements o! di.idends !rom t e Trust at t e pure discretion o! t e Board o! Trustees$ 6uc documentation supports t e .iew t at a UBTO# a"t oug a.ing t e !orm and name o! a trust 0ecause tit"e o! property is con.eyed to trustees !or t e 0ene!it o! 0ene!iciaries# cannot 0e designated or considered to 0e a trust in t e ordinary "ega" sense o! t e term# 0ut is actua""y more "i/e a 0usiness organization$ ?uc documentation !o""owsI Restatement o! t e Law o! Trusts# 2d# American Law >nstitute# %as ington# '$C$I 5T e Restatement o! t is su0Dect does not dea" wit 0usiness trusts $ $ $ $5 (p$ 2)$ 56atters e(c"uded$ A statement o! t e ru"es o! "aw re"ating to t e emp"oyment o! a trust as a de.ice !or carrying on 0usiness is not wit in t e scope o! t e Restatement o! t is su0Dect$ A"t oug many o! t e ru"es app"ica0"e to trusts are app"ied to 0usiness trusts# yet many o! t e ru"es are not app"ied# and t ere are ot er ru"es w ic are app"ica0"e on"y to 0usiness trusts$ T e 0usiness trust is a specia" /ind o! 0usiness association and can 0est 0e dea"t wit in connection wit ot er 0usiness associations$5 (p$ -)$

Tit"e 2J# Code o! 9edera" Regu"ations# ?ection @4*$,,4*--(0)I 5(0) Business Trusts -- T ere are ot er arrangements /nown as trusts 0ecause t e "ega" tit"e to property is con.eyed to trustees !or t e 0ene!it o! 0ene!iciaries# 0ut w ic are not c"assi!ied as trusts !or purposes o! t e >nterna" Re.enue Code# 0ecause t ey are not simp"y arrangements to protect and conser.e t e property !or t e 0ene!iciaries$5 9or t is reason se.era" aut orities re!er to t e 5secret5 trust p"an# used 0y t e ?uper %ea"t y# 0y a name ot er t an 5trust$5 A 5contractua" company5 is one suc designation Ga"t oug 5company5 mig t imp"y# t oug not necessari"y in.o".e# t e e(istence o! 5associates5H$ Anot er uses t e acronym 5Co"ato5 (Common Law Trust Organization)$ 5UBTO5 is c osen ere to distinguis t is entity !rom an ordinary trust$ Bear in mind t at# w i"e de!inite ta( ad.antages are possi0"e# it is neit er proper nor "aw!u" !or a 0usiness trust to a.e as its on"y# e(press purpose t e a.oidance o! ta($ T ere must 0e in.o".ed a !or-pro!it moti.e$ Business acti.ities must 0e engaged in# to 5pass t e sme"" test#5 i$e$# to put su0stance on t e !orm$ 5Common "aw5 re"ates to t ose customs and ru"es o! antiFuity w ic are !ound in (0ut not necessari"y "imited to) precedent setting court cases# and w ic is apart !rom t e "anguage o! "aw$ T e di!!erence 0etween an entity# or person# t at e(ists as a matter o! common "aw rig t and t at w ic arises 0y statutory pri.i"ege is t at# in t e !ormer case# t e entity is !ree to do anyt ing e(cept t at w ic is pro i0ited 0y "aw$ >n t e "atter# t e entity must "oo/ care!u""y to# and remain wit in t e con!ines o!# t e statute in order to e(ist and !unction$ T e essentia" e"ements o! t e "aw o! contract# a0sent in an ordinary trust# are present in t e creation o! a UBTOI *$ Two or more parties at 5armCs "engt 5 (not re"ated 0y 0"ood# marriage# adoption or emp"oyment)= 2$ A transaction in t e nature o! an e(c ange in.o".ing simu"taneous o!!erings and acceptances 0y t e parties= @$ Consideration in t e !orm o! money or moneyCs wort = and -$ A meeting o! t e minds$ T e meeting o! t e minds concerning t e terms o! t e contract is put to t e test w en t e documents are put !orward !or signatures$ >! signed wi""ing"y wit neit er party acting under compu"sion# and t e terms are satis!actory# it is a matter o! !act t at t e parties a.e ad a meeting o! t e minds and a.e agreed upon t e speci!ied conditions$ C;?TU> KU; TRU?T de!inedI &e w o as a rig t to a 0ene!icia" interest in and out o! an estate t e "ega" tit"e to w ic is .ested in anot er$ 2 %as 0$ Rea" Prop$ *J@$ T e person w o possesses t e eFuita0"e rig t to property and recei.es t e rents# issues# and pro!its t ereo!# t e "ega" estate o! w ic is .ested in a trustee$ Bernards.i""e 6et odist ;piscopa" C urc .$ ?eney# 83 7$A$;F$ 2,*# +J A$ @88# @8+= 6oore .$ ? i!!"ett# *8, Ly$ ,# 2*J ?$%$ J*-# J*J$ Bene!iciary o! trust# U"mer .$ 9u"ton# *2+ O io ?t$ @2@# *+3 7$;$ 33,# 3J-# +, A$L$R$ **,4$ B"ac/Cs Law 'ictionary 9ourt ;dition (page 28+) CO66O7-LA% TRA';6ARL de!inedI One appropriated under common-"aw ru"es# regard"ess o! statutes$ ?tratton M Terstegge Co$ .$ ?tig"itz 9urnace Co$# 238 Ly$ J,8# 8* ?$%$2d *# @$ B"ac/)s Law 'ictionary ?i(t ;dition (page 2,,) CO66O7-LA% TRU?T de!inedI A 0usiness trust w ic as certain c aracteristics in common wit corporations and in w ic trustees o"d t e property and manage t e 0usiness and t e s are o"ders are t e trust 0ene!iciaries or cestui Fue trust= sometimes /nown as a 6assac usetts trust$ ?ee 6assac usetts trust$ B"ac/)s Law 'ictionary ?i(t ;dition (page 2,,) 6A??AC&U?;TT? TRU?T de!inedI A 0usiness organization w erein property is con.eyed to trustees and managed !or 0ene!it o! o"ders o! certi!icates "i/e corporate stoc/ certi!icates$ ;noc s M 9"owers .$ Roe""# *,4 6iss$ --# *3- ?o$ 2++$

BU?>7;?? TRU?T de!inedI As distinguis ed !rom a Doint-stoc/ company# a pure 50usiness trust5 is one in w ic t e managers are principa"s# and t e s are o"ders are cestuis Fue trust$ T e essentia" attri0ute is t at property is p"aced in t e ands o! trustees w o manage and dea" wit it !or use and 0ene!it o! 0ene!iciaries$ 6orriss .$ 9in/e"stein# 6o$App$# *2, ?$%$2d -J# -+$ A 56assac usetts trust5 or 5common "aw trust$5 ?ee 6assac usetts trust= Rea" estate in.estment trust (R;>T)$ B"ac/)s Law 'ictionary ?i(t ;dition (page *++) 9;; ?>6PL; de!inedI Typica""y# words 5!ee simp"e5 standing a"one create an a0so"ute estate in de.isee and suc words !o""owed 0y a condition or specia" "imitation create a de!easi0"e !ee$ Ba00 .$ Rand# 6e$# @-3 A$2d -+J# -+8$ A0so"ute$ A !ee simp"e a0so"ute is an estate "imited a0so"ute"y to a person and is or er eirs and assigns !ore.er wit out "imitation or condition$ An a0so"ute or !ee-simp"e estate is one in w ic t e owner is entit"ed to t e entire property# wit unconditiona" power o! disposition during oneCs "i!e# and descending to oneCs eirs and "ega" representati.es upon oneCs deat intestate$ ?uc estate is un"imited as to duration# disposition# and descendi0i"ity$ ?"ayden .$ &ardin# 23, Ly$ J83# ,+ ?$%$2d **# *2$ T e estate w ic a man as w ere "ands are gi.en to im and to is eirs a0so"ute"y wit out any end or "imit put to is estate$ 2 B"$Comm$ *4J$ T e word 5!ee#5 used a"one# is a su!!icient designation o! t is species o! estate# and ence 5simp"e5 is not a necessary part o! t e tit"e# 0ut it is added as a means o! c"ear"y distinguis ing t is estate !rom a !ee-tai" or !rom any .ariety o! conditiona" estates$ 9ee-simp"e signi!ies a pure !ee= an a0so"ute estate o! in eritance c"ear o! any condition or restriction to particu"ar eirs# 0eing descendi0"e to t e eirs genera"# w et er ma"e or !ema"e# "inea" or co""atera"$ >t is t e "argest estate and most e(tensi.e interest t at can 0e enDoyed in "and$ Conditiona"$ Type o! trans!er in w ic grantor con.eys !ee simp"y on condition t at somet ing 0e done or not done$ A de!easi0"e !ee w ic "ea.es grantor wit rig t o! entry !or condition 0ro/en# w ic rig t may 0e e(ercised 0y some action on part o! grantor w en condition is 0reac ed$ At common "aw an estate in !ee simp"e conditiona" was a !ee "imited or restrained to some particu"ar eirs# e(c"usi.e o! ot ers$ But t e statute 5'e donis5 con.erted a"" suc estates into estates tai"$ 2 B"$Comm$ **4$ 'e!easi0"e$ Type o! !ee grant w ic may 0e de!eated on t e appening o! an e.ent$ An estate w ic may "ast !ore.er# 0ut w ic may end upon t e occurrence or nonoccurrence o! a speci!ied e.ent# is a 5!ee simp"e de!easi0"e5$ 7ew0ern .$ Barnes# @ 7$C$App$ 32*# *J3 ?$;$2d 32J# 3@4$ 'etermina0"e$ A 5!ee simp"e determina0"e5 is created 0y con.eyance w ic contains words e!!ecti.e to create a !ee simp"e and# in addition# a pro.ision !or automatic e(piration o! estate on occurrence o! stated e.ent$ ?e"ectmen o! Town o! 7a ant .$ U$ ?$# '$C$6ass$# 2+@ 9$?upp$ *4,J# *+,8$ B"ac/)s Law 'ictionary ?i(t ;dition (page J*3# J*J) ACT de!inedI n$ 'enotes a!!irmati.e= e(pression o! wi""# purpose= carries idea o! per!ormance= primari"y t at w ic is done or doing= e(ercise o! power# or e!!ect o! w ic power e(erted is cause= a per!ormance= a deed$ Brown .$ ?tandard Cas/et 6!g$NCo$# 2@- A"a$ 3*2# *,3 ?o$ @38# @J-$ >n its most genera" sense# t is noun signi!ies somet ing done .o"untari"y 0y a person= t e e(ercise o! an indi.idua"Cs power = an e!!ect produced in t e e(terna" wor"d 0y an e(ercise o! t e power o! a person o0Decti.e"y# prompted 0y intention# and pro(imate"y caused 0y a motion o! t e wi""$ &erman .$ Pan American Li!e >ns$ Co$# *8@ La$ *4-3# *J3 ?o$ *+3# 244$ >n a more tec nica" sense# it means some- t ing done .o"untari"y 0y a person# aria o! suc a nature t at certain "ega" conseFuences attac to it$ Ae!!erson ?tandard Li!e >ns$ Co$ .$ 6yers# Te($ Com$ App$# 28- ?$%$ 2*J# 2*8$ T us a grantor ac/now"edges t e con.eyance to 0e is 5act and deed#5 t e terms 0eing synonymous$ >t 6ay denote somet ing done 0y an indi.idua"# as a pri.ate citizen# or as an o!!icer= or 0y a 0ody o! men# as a "egis"ature# a counci"# or a court o! Dustice= inc"uding not mere"y p ysica" acts# 0ut a"so decrees# edicts# "aws# Dudgments# reso".es# awards# and determinations$ ?ome genera" "aws made 0y t e Congress o! t e United ?tates are sty"ed Doint reso"utions# and t ese a.e t e same !orce and e!!ect as t ose sty"ed acts$ But see 'ec er .$ Baug an# 24+ 6ic $ 3J3# *,, 7$%$ @88# @+2$ Carries idea o! per!ormance$ ;dmonds .$ ? ir"ey# 22 A"a$App$ @+8# **J ?o$ @4@$ An instrument in writing to .eri!y !acts$ %e0ster# 'ict$ >t is used in t is sense o! t e pu0"is ed acts o! assem0"y# congress# etc$ >n a sense approac ing t is# it as 0een e"d in tria"s !or treason t at "etters and ot er written documents were acts= * 9ost$Cr$Cas$ *+8= 2 ?tar/$ **J$ Act indicates t e intention$ 8 Co$ *-J0= Broom# 6a($ @4*$ Ci.i" Law An act is a writing# w ic states in a "ega" !orm t at a t ing as 0een said# done# or agreed$ 6er"$ Repert$

Acts under pri.ate signature are t ose w ic a.e 0een Cmade 0y pri.ate indi.idua"s under t eir ands$ Pri.ate acts are t ose made 0y pri.ate persons as registers in re"ation to t eir receipts and e(penditures# sc edu"es# acFuittances# and t e "i/e$ Pu0"ic acts are t ose w ic a.e a pu0"ic aut ority# and w ic a.e 0een made 0e!ore pu0"ic o!!icers# are aut orized 0y a pu0"ic sea"# a.e 0een made pu0"ic 0y t e aut ority o! a magistrate# or w ic a.e 0een e(tracted and 0een proper"y aut enticated !rom pu0"ic records$ B"ac/)s Law 'ictionary 9ourt ;dition (page -2) ACT O9 ?TAT; de!inedI An act done 0y t e so.ereign power o! a country# or 0y its de"egate# wit in t e "imits o! t e power .ested in im$ An act o! state cannot 0e Fuestioned or made t e su0Dect o! "ega" proceedings in a court o! "aw. B"ac/)s Law 'ictionary 9ourt ;dition (page --) TRU?T de!inedI A "ega" entity created 0y a grantor !or t e 0ene!it o! designated 0ene!iciaries under t e "aws o! t e state and t e .a"id trust instrument$ T e trustee o"ds a !iduciary responsi0i"ity to manage t e trustCs corpus assets and income !or t e economic 0ene!it o! a"" o! t e 0ene!iciaries$ A con!idence reposed in one person# w o is termed trustee# !or t e 0ene!it o! anot er# w o is ca""ed t e cestui Fue trust# respecting property w ic is e"d 0y t e trustee !or t e 0ene!it o! t e cestui Fue trust$ ?tate e( re>$ %irt .$ ?uperior Court !or ?po/ane County# *4 %as $2d @J2# **J P$2d ,32# ,33$ Any arrangement w ere0y property is trans!erred wit intention t at it 0e administered 0y trustee !or anot erCs 0ene!it$ A !iduciary re"ations ip in w ic one person is t e o"der o! t e tit"e to property su0Dect to an eFuita0"e o0"igation to /eep or use t e property !or t e 0ene!it o! anot er$ ?cottiCs 'ri.e >n Restaurants# >nc$ .$ 6i"e &ig -'art >n Corp$# %yo$# 32J P$2d **+@# **+3$ A trust can 0e created !or any purpose w ic is not i""ega"# and w ic is not against pu0"ic po"icy$ Co""ins .$ Lyon# >nc$# *8* Ba$ 2@4# 2- ?$;$2d 3,2# 3,+$ ;ssentia" e"ements o! trust are designated 0ene!iciary and trustee# !und su!!icient"y identi!ied to ena0"e tit"e to pass to trustee# and actua" de"i.ery to trustee wit intention o! passing tit"e$ City Ban/ 9armersC Trust Co$ .$ C arity Organization ?oc$ o! City o! 7ew Oor/# 2@8 App$'i.$ ,24# 2J3 7$O$?$ 2J,$ An association or organization o! persons or corporations a.ing t e intention and power# or t e tendency# to create a monopo"y# contro" production# inter!ere wit t e !ree course o! trade or transportation# or to !i( and regu"ate t e supp"y and t e price o! commodities$ >n t e istory o! economic de.e"opment# t e 5trust5 was origina""y a de.ice 0y w ic se.era" corporations en gaged in t e same genera" "ine o! 0usiness mig t com 0ine !or t eir mutua" ad.antage# in t e direction o! e"iminating destructi.e competition# contro""ing t e out put o! t eir commodity# and regu"ating and maintaining its price# 0ut at t e same time preser.ing t eir separate indi.idua" e(istence# and wit out any conso"idation or merger$ T is de.ice was t e erection o! a centra" committee or 0oard# composed# per aps# o! t e presidents or genera" managers o! t e di!!erent corporations# and t e trans!er to t em o! a maDority o! t e stoc/ in eac o! t e corporations# to 0e e"d 5in trust5 !or t e se.era" stoc/ o"ders so assigning t eir o"dings$ T ese stoc/ o"ders recei.ed in return 5trust certi!icates5 s owing t at t ey were entit"ed to recei.e t e di.idends on t eir assigned stoc/# t oug t e .oting power o! it ad passed to t e trustees$ T is "ast !eature ena0"ed t e trustees or committee to e"ect a"" t e directors o! a"" t e corporations# and t roug t em t e o!!icers# and t ere0y to e(ercise an a0so"ute"y contro""ing in!"uence o.er t e po"icy and operations o! eac constituent company# to t e ends and wit t e purposes a0o.e mentioned$ T oug t e 5trust#5 in t is sense# is now se"dom i! e.er resorted to as a !orm o! corporate organization# a.ing gi.en p"ace to t e 5 o"ding corporation5 and ot er de.ices# t e word 0ecame current in statute "aws as we"" as popu"ar speec # to designate a"most any !orm o! com0ination o! a monopo"istic c aracter or tendency$ 7ort ern ?ecurities Co$ .$ U$ ?$# *+@ U$?$ *+,# 2- ?$Ct$ -@J# -8 L$;d$ J,+= 6a""inc/rodt C emica" %or/s .$ ?tate o! 6issouri# 2@8 U$?$ -*# @3 ?$Ct$ J,*# J,@# 3+ L$;d$ **+2$ >n a "ooser sense t e term is app"ied to any com0ination o! esta0"is ments in t e same "ine o! 0usiness !or securing t e same ends 0y o"ding t e indi.idua" interests o! eac su0ser.ient to a common aut ority !or t e common interests o! a""$ 6a""inc/rodt C emica" %or/s .$ ?tate o! 6issouri# 2@8 U$?$ -*# @3 ?$Ct$ J,*#$J,@# 3+ L$;d$ **+2$ A trust# as t e term is used in t e Restatement# w en not Fua"i!ied 0y t e word 5c arita0"e#5 5resu"ting5 or

5constructi.e#5 is a !iduciary re"ations ip wit respect to property# su0Decting t e person 0y w om t e tit"e to t e property is e"d to eFuita0"e duties to dea" wit t e property !or t e 0ene!it o! anot er person# w ic arises as a resu"t o! a mani!estation o! an intention to create it$ Restatement# ?econd# Trusts P 2$ ?ee a"so Breac o! trust= C arita0"e trust= C"a!"in trust= Common-"aw trust= Comp"e( trust= Constructi.e trust= 'ec"aration ('ec"aration o! trust)# 'eed ('eed o! trust)# ;Fuipment= ;(ecutory trust= :enerations/ipping trust= :o.ernmenta" trusts= :rantor trusts= >""usory trust= >ndestructi0"e trust= >n.estment trust= >n.o"untary trust= Land trust= Li!e insurance trust= Li!e interest= 7omina" trust= 7ominee trust= Ora" trust= Pension trust= Precatory trust= Purc ase money resu"ting trust= Reciproca" trusts= Resu"ting trust= Re.oca0"e trust= ?pendt ri!t trust= Terms o! trust= Unitrust= Boting trust$ B"ac/)s Law 'ictionary ?i(t ;dition (page *348# *34+) ;Q;CUT;' TRU?T de!inedI A trust o! w ic t e sc eme as in t e outset 0een comp"ete"y dec"ared$ A trust in w ic t e estates and interest in t e su0Dect-matter o! t e trust are comp"ete"y "imited and de!ined 0y t e instrument creating t e trust# and reFuire no !urt er instruments to comp"ete t em$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3**) ;QPR;?? PR>BAT; PA??>B; TRU?T de!inedI ?uc e(ists w ere "and is con.eyed to or e"d 0y one person in trust !or anot er# wit out any power 0eing e(press"y or imp"ied"y gi.en trustee to ta/e actua" possession o! "and or e(ercise acts o! owners ip o.er it# e(cept 0y 0ene!iciaryCs direction$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3**) ;QPR;?? TRU?T de!inedI A direct trust$ A trust created or dec"ared in e(press terms# and usua""y in writing# as distinguis ed !rom one in!erred 0y t e "aw !rom t e conduct or dea"ings o! t e parties$ A trust direct"y created !or speci!ic purposes in contrast to a constructi.e or resu"ting trust w ic arises 0y imp"ication o! "aw or t e demands o! eFuity$ Trusts w ic are created 0y t e direct and positi.e acts o! t e parties# 0y some writing# or deed# or wi""# or 0y words e(press"y or imp"ied"y e.incing an intention to create a trust$ Concannon .$ Concannon# **J R$>$ @2@# @3J A$2d -8,# -+"$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3**) >RR;BOCABL; TRU?T de!inedI Trust w ic may not 0e re.o/ed a!ter its creation as in t e case o! a deposit o! money 0y one in t e name o! anot er as trustee !or t e 0ene!it o! a t ird person (0ene!iciary)$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3**) TRU?T ';PO?>T de!inedI % ere money or property is deposited to 0e /ept intact and not comming"ed wit ot er !unds or property o! 0an/ and is to 0e returned in /ind to depositor or de.oted to particu"ar purpose or reFuirement o! depositor or payment o! particu"ar de0ts or o0"igations o! depositor$ A"so ca""ed specia" deposit$ ?ee a"so 'eposit B"ac/)s Law 'ictionary ?i(t ;dition (page *3*@) TRU?T ;?TAT; de!inedI T is term may mean eit er t e estate o! t e trustee#-t at is# t e "ega" tit"e#-or t e estate o! t e 0ene!iciary# or t e corpus o! t e property w ic is t e su0Dect o! t e trust$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*@) TRU?T ;Q 6AL;9>C>O de!inedI % ere actua" !raud is practiced in acFuiring "ega" tit"e# t e arising trust is re!erred to as a 5trust e( ma"e!icio$5 Andres .$ Andres# * Ar/$App$ ,3# J*@ ?I%$2d -4-# -4,$ A 5constructi.e trust#5 ot erwise /nown as 5trust e( ma"e!icio#5 a 5trust e( de"icto#5 a 5trust de son tort#5 an 5in.o"untary trust5 or an 5imp"ied trust5 is a trust 0y operation o! "aw w ic arises against one w o# 0y !raud# actua" or constructi.e# 0y duress or a0use o! con!idence# 0y commission o! a wrong or 0y any !orm o! unconsciona0"e conduct# arti!ice# concea"ment or Fuestiona0"e means and against good conscience# eit er as o0tained or o"ds rig t to property w ic e oug t not in eFuity and good conscience o"d and enDoy$ Briggs .$ Ric ard son# App$# 288 ?$C$ 3@,# @-@ ?$;$2d J3@# J3-$ ?ee a"so Constructi.e trust# a0o.e$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*@) TRU?T;; de!inedI Person o"ding property in trust$ Restatement# ?econd# Trusts# P @(@)$ T e person appointed# or reFuired 0y "aw# to e(ecute a trust$ One in w om an estate# interest# or power is .ested# under an e(press or imp"ied agreement to administer or e(ercise it !or t e 0ene!it or to t e use o! anot er$ One w o o"ds "ega" tit"e to property 5in trust5 !or t e 0ene!it o! anot er person (0ene!iciary) and w o must

carry out speci!ic duties wit regard to t e property$ T e trustee owes a !iduciary duty to t e 0ene!iciary$ Reinec/e .$ ?mit # >""$# 28+ U$?$ *,2# 3@ ?$Ct$ 3,4# ,, L$;d$ **4+$ ?ee a"so Bare trustee$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*-) TRU?T;; '; ?O7 TORT de!inedI Person w o is treated as a trustee 0ecause o! is wrongdoing wit respect to property en trusted to im or o.er w ic e e(ercised aut ority w ic e "ac/ed$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*-) TRU?T;; ;Q 6AL;9>C>O de!inedI A person w o# 0eing gui"ty o! wrong!u" or !raudu"ent conduct# is e"d 0y eFuity to t e duty and "ia0i"ity o! a trustee# in re"ation to t e su0Dect matter# to pre.ent im !rom pro!iting 0y is own wrong$ ?ee Trust (Trust e( ma"e!icio)$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*-) TRU?T;;?&>P de!inedI 9iduciary re"ations ip 0etween trustee and 0ene!iciary w erein trustee o"ds tit"e to property !or t e 0ene!it o! t e 0ene!iciary$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*3) TRU?T ;?TAT;? A? BU?>7;?? CO6PA7>;? de!inedI A practice originating in 6assac usetts o! .esting a 0usiness or certain rea" estate in a group o! trustees# w o manage it !or t e 0ene!it o! t e 0ene!icia" owners= t e owners ip o! t e "atter is e.idenced 0y negotia0"e (or trans!era0"e) s ares$ T e trustees are e"ected 0y t e s are o"ders# or# in case o! a .acancy# 0y t e 0oard o! trustees$ Pro.ision is made in t e agreement and dec"aration o! trust to t e e!!ect t at w en new trustees are e"ected# t e trust estate s a"" .est in t em wit out !urt er con.eyance$ T e dec"aration o! trust speci!ies t e powers o! t e trustees$ T ey a.e a common sea"= t e 0oard is organized wit t e usua" o!!icers o! a 0oard o! trustees= it is go.erned 0y 0y-"aws= t e o!!icers a.e t e usua" powers o! "i/e corporate o!!icers= so !ar as practica0"e# t e trustees in t eir co""ecti.e capacity# are to carry on t e 0usiness under a speci!ied name$ T e trustees may a"so o"d s ares as 0ene!iciaries$ Pro.ision may 0e made !or t e a"teration or amendment o! t e agreement or dec"aration in a speci!ied manner$ >n ;"iot .$ 9reeman# 224 B$?$ *,8# @* ?$Ct$ @J4# 33 L$;d$ -2-# it was e"d t at suc a trust was not wit in t e corporation ta( pro.isions o! t e tari!! act o! Aug$ 3# *+4+$ ?ee a"so Ronne .$ 6inneapo"is ?yndicate# 224 B$?$ *8,# @* ?$Ct$ @J*# 33 L$;d$ -28$ ?ee a"so 6assac usetts trust$ B"ac/)s Law 'ictionary ?i(t ;dition (page *3*3) 9>'UC>ARO de!inedI T e term is deri.ed !rom t e Roman "aw# and means (as a noun) a person o"ding t e c aracter o! a trustee# or a c aracter ana"ogous to t at o! a trustee# in respect to t e trust and con!idence in.o".ed in it and t e scrupu"ous good !ait and candor w ic it reFuires$ A person a.ing duty# created 0y is underta/ing# to act primari"y !or anot erCs 0ene!it in matters connected wit suc underta/ing$ As an adDecti.e it means o! t e nature o! a trust= a.ing t e c aracteristics o! a trust= ana"ogous to a trust= re"ating to or !ounded upon a trust or con!idence$ A term to re!er to a person a.ing duties in.o".ing good !ait # trust# specia" con!idence# and candor towards anot er$ A !iduciary 5inc"udes suc re"ations ips as e(ecutor# administrator# trustee# and guardian$5 ABA Code o! Audicia" Conduct# Canon @C(@)(0)$ A "awyer is a"so in a !iduciary re"ations ip wit t e c"ient$ A person or institution w o manages money or property !or anot er and w o must e(ercise a standard o! care in suc management acti.ity imposed 0y "aw or contract= e$g$ e(ecutor o! estate= recei.er in 0an/ruptcy= trustee$ A trustee# !or e(amp"e# possesses a !iduciary responsi0i"ity to t e 0ene!iciaries o! t e trust to !o""ow t e terms o! t e trust and t e reFuirements o! app"ica0"e state "aw$ A 0reac o! !iduciary responsi0i"ity wou"d ma/e t e trustee "ia0"e to t e 0ene!iciaries !or any damage caused 0y suc 0reac $ T e status o! 0eing a !iduciary gi.es rise to certain "ega" incidents and o0"igations# inc"uding t e pro i0ition against in.esting t e money or property in in.estments w ic are specu"ati.e or ot erwise imprudent$ 6any states a.e adopted t e Uni!orm 9iduciaries Act# and t e Uni!orm 6anagement o! >nstitutiona" 9unds Act$ ?ee a"so 9iduciary capacity= 9iduciary or con!identia" re"ation$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9OR;>:7 9>'UC>ARO de!inedI A trustee# e(ecutor# administrator# guardian or conser.ator appointed 0y a Durisdiction ot er t an t e one in w ic e is acting$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9>'UC>ARO BO7' de!inedI Type o! surety 0ond reFuired 0y court to 0e !i"ed 0y trustees# administrators# e(ecutors# guardians# and conser.ators to insure proper per!ormance o! t eir duties$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23)

9>'UC>ARO CAPAC>TO de!inedI One is said to act in a 5!iduciary capacity5 or to recei.e money or contract a de0t in a 5!iduciary capacity#5 w en t e 0usiness w ic e transacts# or t e money or property w ic e and"es# is not is own or !or is own 0ene!it# 0ut !or t e 0ene!it o! anot er person# as to w om e stands in a re"ation imp"ying and necessitating great con!idence and trust on t e one part and a ig degree o! good !ait on t e ot er part$ T e term is not restricted to tec nica" or e(press trusts# 0ut inc"udes a"so suc o!!ices or re"ations as t ose o! an attorney at "aw# a guardian# e(ecutor# or 0ro/er# a director o! a corporation# and a pu0"ic o!!icer$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9>'UC>ARO CO7TRACT de!inedI An agreement 0y w ic a person de"i.ers a t ing to anot er on t e condition t at e wi"" restore it to im$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9>'UC>ARO ';BT de!inedI A de0t !ounded on or arising !rom some con!idence or trust as distinguis ed !rom a 5de0t5 !ounded simp"y on contract$ 6ontgomery .$ P i""ips Petro"eum Co$# Te($ Ci.$ App$# -+ ?$%$2d +J,# +,@$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9>'UC>ARO 'UTO de!inedI A duty to act !or someone e"seCs 0ene!it# w i"e su0ordinating oneCs persona" interests to t at o! t e ot er person$ >t is t e ig est standard o! duty imp"ied 0y "aw (e$g$# trustee# guardian)$ B"ac/)s Law 'ictionary ?i(t ;dition (page J23) 9>';L>TO BO7' de!inedI Contract o! !ide"ity insurance$ Runcie .$ Corn ;(c ange Ban/ Trust Co$# ?up$# J 7$O$?$2d J*J# J24$ A guaranty o! persona" onesty o! o!!icer !urnis ing indemnity against is de!a"cation or neg"igence$ P i""ips .$ Board o! ;ducation o! Pine.i""e# 28@ Ly$ *,@# *-4 ?$%$2d 8*+# 822$ A contract w ere0y# !or a consideration# one agrees to indemni!y anot er against "oss arising !rom t e want o! onesty# integrity# or !ide"ity o! an emp"oyee or ot er person o"ding a position o! trust$ Li0erty 6ut$ >ns$ Co$ .$ T under0ird Ban/# 23 Ariz$ App$ 24*# 3-2 P$2d @+# -*$$ ?ee a"so Bond= 9ide"ity and guaranty insurance= >nsurance$ % ere0y t is act de!ined pursuant to and in accordance wit t e !o""owing U$?$ ?upreme Court Annotated ?tatute= &a"e .$ &en/e"# 24* U$?$ -@ at -, (*+43)I 5T e indi.idua" may stand upon is constitutiona" rig ts as a citizen$ &e is entit"ed to carry on is pri.ate 0usiness in is own way$ &is power to contract is un"imited$ &e owes no suc duty Gto su0mit is 0oo/s and papers !or an e(aminationH to t e ?tate# since e recei.es not ing t ere!rom# 0eyond t e protection o! is "i!e and property$ &is rig ts are suc as e(isted 0y t e "aw o! t e "and GCommon LawH "ong antecedent to t e organization o! t e ?tate# and can on"y 0e ta/en !rom im 0y due process o! "aw# and in accordance wit t e Constitution$ Among is rig ts are a re!usa" to incriminate imse"!# and t e immunity o! imse"! and is property !rom arrest or seizure e(cept under a warrant o! t e "aw$ &e owes not ing to t e pu0"ic so "ong as e does not trespass upon t eir rig ts$5 &a"e .$ &en/e"# 24* U$?$ -@ at -, (*+43)$ Pri.ate de!inedI A!!ecting or 0e"onging to pri.ate indi.idua"s# as distinct !rom t e pu0"ic genera""y$ 7ot o!!icia"= not c"ot ed wit o!!ice$ Peop"e .$ Powe""# 284 6ic $ J++# 2,- 7$%$ @,2# @,@$ B"ac/)s Law 'ictionary ?i(t ;dition (page **+3)$ ?o.ereign Peop"e or 9ree0orn are t ose men w o are not 0ound 0y oat to ser.e ot er men$ ?u0Dects are t ose men w o a.e gi.en an oat o! ser.ice to anot er man# or group o! men$ ;.ery 9ree0orn w o !o""ows :od)s Laws is 0"essed wit t e rig t to sett"e is own disputes i$e$ o"ds is own court at wi""$ 9ree0orn may 0ring suit against ot er !ree0orn# t oug eac as eFua" standing# and is not 0ound 0y any ot er man)s court un"ess 0y oat # or .o"untary de"egation$ A !ree0orn is genera""y empowered to sett"e disputes 0etween is su0Dects$ T is is dependent upon t e oat 0etween t e !ree0orn and t e su0Dect$ A !reeman may 0ring suit against is own su0Dects$ ?u0Dects a.e no standing in court# sa.e t at o! t eir master$ T ey may sue t eir master on"y at is p"easure# un"ess t e oat 0etween t e master and su0Dect speci!ica""y a""ows it# w ic is not common$ 7o su0Dect may direct"y sue anot er !ree0orn# 0ut must appea" to is master to sue !or re"ie! on is 0e a"!$