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Statutory Trust

A trust created by the effect of a statute.

In Scott on Trusts:

"In a number of situations .. statutes have provided for the creation of a trust even though there is no manifestation of intention of anyone to create a trust."

They are usually temporary in nature and serve the purpose of bridging ownership of property to benefit a certain class of individuals which the statute is designed to protect.

Some examples are the temporary trusts that the statutes of some states impose on the executor of an estate, the holding and administration of tax or other pay deductions (including vacation pay) by employers, the trust accounts of lawyers and the statutory trust on money paid for a construction project on behalf of any person who might have a construction lien on the property.

REFERENCES:

Scott, A. and Fratcher, W., Scott on Trusts, 4th Edition (Boston: Little Brown & Company, 1987), §17.5.

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Unless otherwise noted, this article was written by Lloyd Duhaime, Barrister, Solicitor, Attorney and Lawyer (and Notary Public!). It is not intended to be legal advice and you would be foolhardy to rely on it in respect to any specific situation you or an acquaintance may be facing. In addition, the law changes rapidly and sometimes with little notice so from time to time, an article may not be up to date. Therefore, this is merely legal information designed to educate the reader. If you have a real situation, this information will serve as a good springboard to get legal advice from a lawyer.

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