Trust Law - Significance

Significance

The trust is widely considered to be the most innovative contribution to the English legal system. Today, trusts play a significant role in most common law systems, and their success has led some civil law jurisdictions to incorporate trusts into their civil codes. Curaçao for example has introduced a trust in its Civil Code from 1 January 2012, which does only allow express trusts, constituted by a Notarial deed. France has recently added a similar, though not quite comparable, notion to its own law with la fiducie, which was modified in 2009; la fiducie, unlike the trust, is a contract. Trusts are widely used internationally, especially in countries within the English law sphere of influence, and whilst most civil law jurisdictions do not generally contain the concept of a trust within their legal systems, they do recognise the concept under the Hague Convention on the Law Applicable to Trusts and on their Recognition (partly only the extent that they are parties thereto). The Hague Convention also regulates conflict of trusts.

Although trusts are often associated with intrafamily wealth transfers, they have become very important in American capital markets, particularly through pension funds (essentially always trusts) and mutual funds (often trusts).