Civil Law Substitutes for Trusts

Abstract

Trusts have now pervaded all fields of social institutions in common law countries. They are like those extraordinary drugs curing at the same time toothache, sprained ankles, and baldness sold by peddlers on the Paris boulevards; they solve equally well family troubles, business difficulties, religious and charitable problems. What amazes the sceptical civilian is that they do really solve them! Trusts have become so indispensable to the life of the Anglo-saxon jurist that one of his first questions when he meets a civilian is: How do you solve the problem that we solve in using the trust device? The aim of this article is to answer that question. But before answering it, we must explain that from the mere fact that trusts do not exist in the civil law, it does not follow that they would not be recognized or enforced in civil law countries. It is not the plan here to consider all the principles of conflicts of law which would be applicable to trusts; it will be enough to show the approach to the problem. The law of trusts appears to the civil law judge to have two aspects, the creation of personal relations, and the creation of rights in rem. As for the first, it is a firmly established principle of the civil law that parties can assume whatever obligations they please as long as such obligations are not considered against public policy, and an ordinary trust is not so considered. Of course, certain clauses of a trust may be against public policy under any system of law. The significant thing is that in a trust qua trust there is nothing shocking to the mind of civil law jurists, as far as rights in personam are concerned. Considered from the angle of rights in rem, the question appears to be an entirely different one. Rights established in property located in a civil law country must be recognized in that country under its own system. The question therefore is, does the civil law have rights in rem similar enough to those created by a trust to render recognition of the latter possible? To that question it is impossible to give an unqualified answer, because rights in rem vary greatly in different trusts. All degrees may exist between cases in which the cestui que trust has no legal personality (trust for the care of horses, for erecting a monument, for saying masses, etc.), and those in which the cestui que trust has created the trust himself for his own convenience and has a substantial control over its administration and duration. Hence the approach to the solution of the pres-