THE CONCEPT OF TRUST IN NIGERIA: DUTIES, RIGHTS AND LIABILITIES


THE CONCEPT OF TRUST IN NIGERIA: DUTIES, RIGHTS, AND LIABILITIES

ABSTRACT

The modern trust is an offshoot from the medieval use of land. But with the passage of time and events, it has evolved a considerable number of distinctive qualities not possessed by the earlier use and has been applied to properties of all kinds. Basically, a trust is a convenient method whereby a limited number of persons may hold property on behalf of other persons who may include persons unborn. The multifarious uses of trust in modern society call for a clearer appreciation of its basic principles. In this regard attempt has been made in the first chapter of this work to highlight the origin and development of the concept of trusts. This is followed in Chapter Two by an in-dept examination of the methods of creating trusts and the various types of trust. Since trustees are not at large in the exercise of their powers and discharge of their functions, the writer discusses the rights of trustees and the liabilities to which they may in law be exposed while carrying out their functions in Chapter Three. Having dealt with the historical development of trusts and the extant legal framework for their creation and operation in the preceding chapters, Chapter Four of this work has been devoted to a critique of the system of trusts as presently practised; recommendations are then proffered by the writer for the more efficient, effective and productive use of the trust system under Nigerian law.

TABLE OF CONTENTS

Title Page i
Approval Page ii
Certification iii
Dedication iv
Acknowledgement v
Table of Cases vi
Table of Statutes ix
List of Abbreviations x
Abstract xi
Table of Contents xii

INTRODUCTION

CHAPTER ONE

HISTORICAL BACKGROUND OF TRUST AND ITS APPLICATION IN NIGERIA
1.1 Historical Background of the concept 3
1.2 Trust under Customary Law 6
1.3 Trust in Nigerian Statutes 8
1.3.1 Trust under the Land Use Act 8
1.3.2 Trust in the Companies and Allied Matters Act 11
1.3.3 Trust under the Bankruptcy Act 12

CHAPTER TWO

CREATION AND CLASSIFICATION OF TRUSTS 13
2.1 Capacity to Create Trust 13
2.2 Formalities for the Creation of Trust 13
2.3 Legal Requirements for the Creation of Trust 15
2.3.1 Certainty of Words 15
2.3.2 Certainty of Subject Matter 16
2.3.3 Certainty of Object 18
2.4 Effect of Uncertainty 19
2.5 Classification/Types of Trusts 20
2.5.1 Express Trust 21
2.5.2 Implied Trust 22
2.5.3 Constructive Trust 24
2.5.4 Charitable Trust 26
2.5.5 Secret Trust 29
2.5.6 Discretionary Trust 29
2.5.7 Executed and Executory Trust 30
2.5.8 Completely Constituted and Incompletely Constituted Trust 31
2.5.9 Protective Trusts 32

CHAPTER THREE

DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES
3.1 Standard of Care of Trustees 34
3.2 Particular Duties of Trustees 35
3.2.1 Duties not to Deviate from the Terms of the Trust 35
3.2.2 Duty of Loyalty 36
3.2.3 Duty of Investment 37
3.2.4 Duty not to Delegate 39
3.2.5 Duty of Impartiality 40
3.2.6 Duty to Account and Furnish Information 41
3.2.7 Duty to Distribute Trust Property 42
3.2.8 Duty to act Jointly where more than one 43
3.2.9 Duty of Trustees not to set up jus terti (third party’s right) 44
3.3 Rights and Liabilities of Trustees 45
3.3.1 Payment of Trustees 45
3.3.2 Trustee’s Right to Indemnity 47
3.3.3 Trustee’s Right to Discharge on Completion of Trusteeship 48
3.3.4 Right to Trust Fund into Court in Certain Circumstances 49
3.3.5Trustee’s Liability 50
3.3.6 Measure of Trustee’s Liability 51
3.3.7 Joint and Several Liability of Trustees 54
3.3.8 Criminal Liability of Trustees 54

CHAPTER FOUR

CRITIQUE, RECOMMENDATIONS AND CONCLUSION
4.1 A Critique of the Concept of Trust 56
4.2 Recommendations 63
4.3 Conclusion 64

BIBLIOGRAPHY 65

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