What is the beneficiary principle UK?

The beneficiary principle is a policy of English trusts law, and trusts in Commonwealth jurisdictions, that trusts which do not have charitable objects, as under the UK Charities Act 2006 sections 2 and 3, and also do not make the trust property available for the benefit of defined people (i.e. beneficiaries), are void …

Do we need the beneficiary principle?

General rule- a trust generally needs human beneficiaries unless it’s a Charitable Trust or a trust for purposes.

What is a company beneficiary?

Beneficiary – an individual or legal entity that receives income from its assets. That is, for example, it may be the owner of the company, which receives income from the activities of his company.

What is a beneficiary in equity law?

“Beneficiary” as equitable owner of the trust property. ⇒ On one view, a “beneficiary” is someone who has equitable ownership of the trust property → The “beneficiary principle” thus demands the existence of an equitable owner in order for there to be a valid trust.

What is a principal beneficiary?

the Principal Beneficiary means the person named in these terms of trust as the Principal Beneficiary and who fulfils the requirements set out in section 1209M of the Social Security Act or 52ZZZWA of the Veterans’ Entitlements Act.

What does perpetuity period mean?

The perpetuity period is the length of a life or lives in being, plus 21 years. A life in being means a life in being at the time of the disposition.

Does the beneficiary principle apply to gifts?

A gift can be made to persons…but it cannot be made to a purpose or to an object: so also, a trust may be created for the benefit of persons as cestuis que trust but not for a purpose or object be charitable. ‘ So far, so compatible with the strong version of the beneficiary principle.

What are the exceptions to the beneficiary principle?

The principle that, for a trust to be valid, there must be a human beneficiary capable of enforcing the trust. Exceptions to the beneficiary principle are charitable trusts and a limited number of purpose trusts.

What beneficiary means?

A beneficiary is the person or entity you name in a life insurance policy to receive the death benefit. You can name: One person. Two or more people. The trustee of a trust you’ve set up.

Who is the beneficiary of a business account?

A Payable on Death (POD) beneficiary is an individual, group of individuals, non-profit, company, organization or trust, other than the owner or co-owner, designated by the owner(s) of the account to receive the balance of funds when the last owner on the account passes away.

Can a business be a beneficiary?

A beneficiary will normally be a natural person, but it is perfectly possible to have a company as the beneficiary of a trust, and this often happens in sophisticated commercial transaction structures.

What is a principal distribution?

A distribution generally refers to the disbursement of assets from a fund, account, or individual security to an investor. With securities, like stocks or bonds, a distribution is a payment of interest, principal, or dividend by the issuer of the security to investors.

Which is an example of the beneficiary principle?

The beneficiary principle was reiterated in Leahy v Attorney General for New South Wales [1959] HCA 20: ‘a trust may be created for the benefit of persons […] but not a purpose.’ A clear example of where a trust failed for want of objects is in Re Astor’s Settlement Trusts [1952].

Who is the principal beneficiary of a trust?

the Principal Beneficiary means the person named in these terms of trust as the principal beneficiary and who fulfils the requirements set out in section 1209M of the Social Security Act or 52ZZZWA of the Veterans’ Entitlements Act.

Is the beneficiary principle a general principle or a corollary?

The corollary of the principle, as illustrated by the facts of Re Astors Settlement Trusts, is that English law does not like trusts for purposes as a general concept. There is a second reason for the law of trusts embodying the beneficiary principle.

Which is trust of an imperfect obligation infringes the beneficiary principle?

A trust of an imperfect obligation is a trust which has no defined human beneficiary and which would, at first glance, appear to infringe the beneficiary principle since such a trust is for a purpose.