Introduction

Commerce and the trust

The focus in this book has so far been on the use or imposition of the trust in various family contexts. It was often in response to problems posed in these contexts in particular that many of the basic rules of trusts law evolved. Some rules, for example, those relating to duties concerning investment and delegation, indirectly provide guidelines for commercial decisions to be taken during administration of a trust. But the trust concept has today also penetrated more directly into many and varied areas of commercial and financial activity (see Chapter 1 at p 9). In this chapter our focus shifts to one of those areas where the trust retains a significant role, namely collective saving for retirement via occupational pension provision. This is not to say that the trust does not feature significantly in other areas of commerce and finance. In the form of the ‘unit trust’, a hybrid creation comprising a complex amalgam of the concepts of common law contract and equitable trust, it provides a medium of collective investment for investors who wish to spread their risks over a wide range of securities (see Chapter 1). Recent estimates put the total number of unit trusts at closer to 1,800 with a market value in the region of £350 billion (thousand million) (Financial Statistics no 561, January 2009, Table 5.3D).