THE LAW OF TRUST 329
vested in the same person the equitable merges in the legal interests which means that the trust comes to an end.
There are two principles to be borne in mind
(i) There is no trust if it does not create a separate equitable interest.
(ii) There is no trust if the separate legal and equitable interest become merged.
- Applying these two principles we reach the following conclusion—
(i) There is no merger when the author of the Trust and the trustee are the same. Therefore, they need not be distinct.
(ii) There is no creation of a separate equitable estate when the author of the Trust and the beneficiary are the same. Therefore, they must be distinct.
(iii) There is merger when the trustee and the beneficiary are the same. Therefore, they must be distinct.
To sum up. The author of the trust and the trustee may be one and the same person. But the beneficiary must always be a distinct person separate from the author of the trust as well as from the trustee.
- So far we have taken simple cases where the parties are single individuals. What happens when the parties are multiple parties, and where some of them play double role.
Illus.
(i) A and B are the beneficiaries of a trust. Of them A is also a trustee. Is such a trust valid ?
(ii) A and B are beneficiaries of a trust. Of them A is the author of the trust. Is such trust valid ?
- The answer to the first question is in the affirmative. It is found in Section 6 which defines a trust. The definition does not give an answer to the Second question. Yet such a trust is invalid.
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