Introduction & Definitions
Thank you for purchasing a Trust from PROMINEE®! The Trust is a fantastic tool that can carry a lot of complexities and possibilities. It is also very versatile.
The Trust involves 3 groups of people:
- the Settlor or Grantor: the person contributing and transferring asset(s) to the Trust [just like an investor of a company].
- the Trustee(s): the person(s) taking care of the daily tasks during the lifetime of the Trust [just like managers of a company].
- the Beneficiary or Beneficiaries: the person(s) entitled to receive the asset(s) of the Trust [just like shareholders of a company].
The Trustees are working for: #1 the Settlor; and #2 for the Beneficiaries (the priority is important). PROMINEE® will do everything to accommodate your requests and wishes.
The Trust is a legal entity that can own property in its own name, but the Trustee(s) can also hold property in the name of the Trust (thus the existence of the Trust can remain secret/private).
The Trust is organized in writing: this is called the Trust Deed, or the Trust Governing Instrument. ⚠️This written contract is pretty much set in stone: it cannot be amended. Only the list of Trustees is the moving part of a Trust and only the Trustees will change during the lifetime of the Trust.
The Trust can accommodate any kind of situation because it can also contain specific Actions when certain Events happen. For example, the Trust Deed can contain: “in May 2035 the Trust shall lend $30,000 with no-interests to the first Beneficiary for sole purpose of attending an University Education, this loan shall be repaid within 10 years, otherwise the debt is forgiven“.
The Trust can have a life span as short as 2 years, or as long as 1,000 years, or even perpetuity. The destruction of the Trust is called the dissolution or termination.
⚠️The Trust should be funded appropriately to withstand the expected duration (ie: the assets shall generate enough income to cover the Trustee’s fee).
⚠️The Trustee(s) will have to terminate the Trust if there are no more assets (this is called a failed Trust).
It is important to note that the Settlor and the Beneficiaries can transfer asset(s) to the Trust at any time.