McGILL LAW JOURNAL
REVUE DE DROIT DE McGILL
Volume 25
Montreal
1980
No. 4
The Trust in Quebec*
Yves Caron**
The law of trusts in Quebec has puzzled scholars, largely because
of the difficulty of explaining the fights of the parties involved.
There also are difficulties in attempting to reconcile the trust
with traditional civilian concepts, such as the notion of “absolute
ownership”. We shall review briefly the introduotion e-nd the place
of the trust in the law of Quebec, and then examine the various
interpretations to which the institution has given rise in orler to
provide, in a final section, a statement of the work of proposed
revision accomplished in Quebec in recent years.
I. Introduction and place of the trust in Quebec
A. The old law and the Code of 1866
Staunch civilians claim that the trust (or at least one form of
trust) has always existed in their system, which had roots in
Roman law, was perpetuated through old customary law, and
maintained in modem codifications. Trusts are discerned by these
soholars in various kinds of substitutions and testamentary exe-
cutorships. Where an heir was charged with a conddition or an
*This paper, posthumously published here, was delivered
in substan-
tially this form at the September 1974 meeting of the Society of Public
Teachers of Law in Exeter, England. It was prepared for publication and
extensively documented by Professor 3. E. C. Brierley, Sir William Macdonald
Professor of Law, Faculty of Law, McGill University.
** 1939-1977. Professor of Law, McGill University, 1967-1977.
McGILL LAW JOURNAL
[Vol. 25
express stipulation pour autrui, the term “fiduciary” was often used
to characterize his obligation to transfer or remit all or part of his
bequest to designated beneficiaries. These stipulations were generally
limited to gifts inter vivos or testamentary .dispositions. One of the
debated questions was whether the “fiduciary” had rights of enjoy-
ment in the property subject to the ‘disposition, in which case there
was a mere substitution, or whether his position was more properly
characterized as one where he had no rights at all, in which case
he had only an obligation to pass the property to the beneficiary
(for instance, at the latter’s majority) and was therefore acting as
trustee. In this latter case, however, the trust’s similarity to testa-
mentary executorship made it rather difficult to distinguish between
the two. In fact, the scarcity of actual trusts under the old law
and the lack of judicial decisions make it difficult to appreciate
fully the nature and purpose of such trusts at that time. Faribault,
a leading Quebec scholar on this question, reports his frustrated
attempts to find useful precedents.1
While a study of old French law (or, for that matter, of Roman
law) would be interesting for the purpose of linking trusts with
modem civilian principles, it would throw little light on current
problems of interpretation or of law reform. In Quebec, the use
of the Coutume de Paris would appear to have rendered the trust
almost non-existent in practice. The Civil Code of 1866 did, however,
contain two provisions that may -be regarded as reproducing the
old French law in the codified law of Quebec. The first, article 869
C.C., concerns testamentary gifts made to -fiduciaries for charitable
and -religious purposes. Such “trusts” are explicitly restricted to
these purposes and thus are not strictly in the tradition of the old
French laws although there are conflicting opinions on this point8
The other provision, article 964 C.C., repeats the old law in so far
as it provides that where a bequest, made for the benefit of designat-
ed beneficiaries, appears to give title to a fiduciary and the dis-
position becomes impossible to fulfil, the fiduciary, having no right
in the property, must return it to the heirs of the original testator.
This particular type of bequest, although it appears to be a substi-
tution, is nonetheless construed as a fiducie or a form of testamen-
tary execution. Notwithstanding the use of. the word “trustee” in
the English version of this provision in the Code of 1866, its French
civil dans la province de Qudbec (1936), 3641.
1 Faribault, Traitg thgorique et pratique de la fiducie ou trust du droit
2 1bid., 4245, 199.
3 Ibid.; see also Valois v. de Boucherville [1929] S.C.R. 234, 260-63.
1980]
THE TRUST IN QUEBEC
origins are not seriously disputed. Indeed, it has served as a basis
for a modem civilian interpretation of the trust in the present law
of Quebec.
The turning point in the history of trusts in Quebec is the Quebec
Act of 1774. This statute, while maintaining the French civil law in
the province of Quebec, also introduced the principle of freedm
of testation, and thus removed the restraints of the old French law
on testamentary gifts. The result was an increase in the number
of wills containing trusts in the Anglo-Saxon tradition, even though
there were no provisions on the matter other than those mentioned
aboveea
B. The trust legislation of 1879
It was not until 1879 that a statute respecting trusts was
In 1888, these provisions were incorporated into the
adoptedL
Civil Code as articles 981a through 981n C.C. With the exception of
the Special Corporate Powers Act of 19147 which authorizes the
creation of trusts for bond or debenture holders, and of the Trust
Companies Act,8 which contains some references (not relevant for
present -purposes) to trusts, there has been no other legislation
on trusts in Quebec to date.
The Act of 1879 is surprisingly short and sianply drafted when
compared with trust provisions in other jurisdictions. It will be
more useful in the present context to reproduce its principal pro-
visions as found in the Civil Code since 1888 than to summarize
them:
Art. 981a. Toute personne capa-
ble de disposer librement de ses
biens, peut transporter des proprid-
tds mobili~res ou immobili~res A des
fiduciaires par donation ou par tes-
tament, pour le bdndfice des per-
sonnes en faveur de qui elle peut
faire valablement des donations ou
des legs.
Art. 981a. All persons capable of
disposing freely of their property
may convey property, moveable or
immoveable, to trustees by gift or
by will, for the benefit of any per-
sons in whose favor they can validly
make gifts or legacies.
4 Mettarlin, The Quebec Trust and the Civil Law (1975) 21 McGill LJ. 175.
GAn act for making more effectual provision for the government of the
province of Quebec in North America, 14 Geo. III, c. 83, s. 10 (U.K.).
5a See, e.g., Abbott v. Fraser (1874) L.R. 6 P.C. 96.
6An Act respecting Trusts, S.Q. 1879, c. 29. The origins or source of the
provisions are not known.
7S.Q. 1914, c. 51; now L.R.Q. 1977, c. P-16.
8 Now L.R.Q. 1977, c. C-41.
McGILL LAW JOURNAL
[Vol. 25
Art. 981b. Les
fiduciaires, pour
les fins de la fiducie, sont saisis,
comme d6positaires et administra-
teurs, pour le b6n6fice des donatai-
res ou l6gataires, des propri6t6s mo-
bili!res ou immobili~res h eux trans-
port6es en fiducie, et peuvent en
revendiquer
la possession, mame
contre les donataires ou l6gataires
pour le b6n6fice desquels la fidu-
cie a 6t6 crd6e … . [L]es fiduciaires
peuvent poursuivre et 6tre poursui-
“vis et prendre tous procdd6s judi-
ciaires pour les affaires de la fidu-
cie.
Art. 981b. Trustees, for the pur-
poses of their trust, are seized as
depositaries and administrators for
the benefit of the donees or legatees
of the property, moveable or im-
moveable, conveyed to them in trust,
and may claim possession of it, even
against the donees or legatees for
whose benefit the trust was creat-
ed … . [T]he trustees may sue and
be sued and take all judicial pro-
ceedings for the affairs of the trust.
Art. 981e. Les pouvoirs d’un fidu-
ciaire ne passent pas a ses h6ritiers
ou autres successeurs ….
Art. 981e. The powers of a trustee
do not pass to his heirs or other
successors ….
Art. 981j. Les
fiduciaires,
Art. 981j. The
intervention of
sans
1intervention des parties b6n6ficiai-
res, g~rent la propridt6 qui leur est
confide et en disposent, placent les
sommes d’argent … et changent, mo-
difient et transposent, de temps ii
autres, les placements ….
The other provisions in articles 981a to 981n C.C. provide rules of
administration, accounting, and procedure not dissimilar to the
trust rules of any other jurisdiction or to rules applicable to testa-
mentary executors.
trustees, without
the parties
the
benefited, administer the property
vested in them and dispose of it,
… and alter, vary
invest moneys
and transpose, from time to time,
the investments ….
There has been considerable comment on the legal implications
of this trust. The courts have said on many occasions that while the
Quebec trust could perhaps operate like the common law trust, it
is by no means to be interpreted or governed by the rules and pre-
cedents of the common law.9 The words used by the legislature in
1879 may have created a mechanism called the “trust” and an
institution that operates as a trust, but they have not defined the
legal nature of this method of transferring property.
Trusts have been widely used in practice, and few difficulties
have been experienced in the ordinary course of drafting gifts and
wills in which they are contained. The courts have found little
difficulty in determining that the application of these provisions
was to be restricted to the situations specified in the Civil Code,
and have not allowed them to serve as a base for developing such
9E.g., Curran v. Davis [1933] S.C.R. 283, 301; Lalibertg v. Larue [1931]
S.C.R. 7; Laverdure v. Du Tremblay [1937] A.C. 666 (P.C.).
19801
THE TRUST IN QUEBEC
institutions as the declaration of trust” or a unit trust for invest-
ment purposes (even as an outgrowth of a “family” trust).”
Among the many questions that have never been taken to court
are the possibilities of the constituant of the trust (hereinafter
called the “trustor “‘ 2 ) being a trustee, of a beneficiary serving as
a trustee, and of the premature termination or variation of the trust.
In fact, some believe that it is preferable not to enter into litigation
over the law of trusts, for fear that the courts may crystallize some
aspect of the practice that has so far remained flexible. However,
it is inevitable that from time to time such questions are litigated
and the result shows that there is no prevailing-,unanimity on the
nature of the trust in Quebec.
II. Interpretations of the trust
Article 981a C.C. refers to a conveyance of property to trustees.
This gives rise to two problems: the first concerns the source of
the provision and its relationship to the principles of civil law or,
alternatively, to the law of the Anglo-Saxon trust; the other concerns
the legal effects of this conveyance. While the property is conveyed
to trustees, to whom is ownership transferred? Is the trustee owner,
or is it the beneficiary who owns, or is it yet some other person?
Is this owner vested with full ownership 13 or is his right qualified,
restricted or divided? In other words, does the conveyance create
both “legal” and “beneficial” ownership?
The fact that the trustee does not have any personal rights in
the trust property is reminiscent of the old French fiducie and of
testamentary execution. Yet, since it is admitted that none of the
beneficiaries of the trust has a real right in the trust property,
it follows that ownership is either in suspense (the. usus and fructus
not being vested in anyone) or that some other explanation (such
as “split” ownership or legal personality) has to be found as the
3O E.g., O’Meara v. Bennett [1922] A.C. 80 (P.C.).
E E.g., Crown Trust Co. v. Higher [1977] 1 S.C.R. 418; Cantin Cumyn,
Crown Trust Co. v. Higher: La fiducie de placement en droit civil qudbdcois
(1977) 23 McGill LJ. 687.
12The word “trustor”, adapted from the term of Scots law, “truster”, is
employed to refer to the person constituting the trust, whether it be created
by gift inter vivos or by will. [The term was not adopted in the final draft
of the Civil Code Revision Office; see infra, note 49. –
J.E.C.B.].
13 Cf. art. 406 C.C.: “Ownership is the right of enjoying and of disposing of
things in the most absolute manner, provided that no use be made of them
which is prohibited by law or by regulation”.
McGILL LAW JOURNAL
[Vol. 25
basis of the trust in Quebec. The various possibilities, four in
number, will now be reviewed.
A. The trustee as owner
1. Judicial interpretations
A significant number of judges favour ‘the view that, under a
Quebec trust, the trustee is the owner of the trust property. The
argument is simple: by article 981a C.C., the conveyance of the pro-
perty is to the trustee and therefore he is the owner; there is no
reason to argue to the contrary, since, under Quebec law, there has
to be one owner of the property at all times. This opinion is
generally credited to the Supreme Court of Canada in Curran v.
Davis, and to Mignault who expressed it -more explicitly.14
In fact, the findings of Rinfret J. in the Curran case, whidh
appear to point to the proposition that the trustee is owner, have
been exaggerated by subsequent writers. In the Curran case, much
of the discussion was concerned with establishing that the bene-
ficiaries of the trust were not the beneficial owners of the property.
The Court was also concerned with the question of distinguishing
the Quebec trust from the English trust. As put by Lord Buck-
master in O’Meara v. Bennett, “an examination of the question of
how far the transaction would have been valid under English law
is misleading until it is ascertained to what extent English law
applies”.’5 Earlier, in Laltbertd v. Larue, Mr Justice Rinfret had
stated in the Supreme Court that “[i]l serait inconcevable que le
ldgislateur efit voulu introduire d’un seul coup le ‘trust’ anglais
avec sa complexit6 et ses [multiples] aspects si fonci~rement 6tran-
gers h l’6conomie du droit de Qudbec”. 16
The beneficiary was therefore regarded as a creditor of the
trust but not as an owner of its property. On the other hand,
Rinfret J. never said in the Curran case that the trustee actually was
the owner. He said that the trustee has no usus, no fruqtus and no
abusus, that he only has the “executive powers” to act in respect
of the property, that he is’ without title and oly an “apparent
owner”. 17 The Curran case has generally been relied upon, however,
14 Curran v. Davis, supra, note 9; Mignault, Droit civil canadien (1901),
vol. 5, 151 et seq.; Mignault, A propos de.fiducie (1933-34) 12 R. du D. 73, 76
(comment on Curran v. Davis).
15 Supra, note 10, 84.
16Supra, note 9, 18.
17 Supra, note 9, 293, 305-6.
19801
THE TRUST IN QUEBEC
as meaning that the trustee is the owner of the trust property,
albeit in a special way.’8
Two other cases merit mention in this connection. First, in
Greenshields & Chartered Trust Co. v. The Queen, Locke J. (dissent-
ing), citing the Curran case, summed up as follows:
As declared by the article [article 981a C.C.], the property is held by- the
trustees for the benefit of the cestuis-que-trust. The legal title is vested
in the trustees as well as the right to possession but, from the time of
the death of the testator, that estate was in their hands impressed with
a trust in favour [of the beneficiaries]. To say this is but to paraphrase
the language of Rinfret 1. in Curran’s case.’9
This sui generis right of the trustee is not further explained. One is
reminded of a substitution without enjoyment by the institute.
Second, in Reford v. National Trust Co., the same idea was
stated more recently in the Quebec Court of Appeal:
les plus itendus de vendre,
En vertu de la loi (art. 981a et s. C.C.) et du contrat, la propri6t6 dudit
fonds est transmise aux fiduciaires, mais ce n’est pas la proprit6 d~finie
r larticle 406. Pendant 1existence de la fiducie, les fiduciaires ont les
ils doivent rendre
pouvoirs
compte … . Toutefois, pendant ce temps, la propri6t6 n’est pas en sus-
pens; elle est n6cessairement restreinte par reffet de la fiducie et elle
repose sur la t6te des fiduciaires. Ces derniers n’ont, sans doute, qu’un
droit limit6 de propri6t6 bien qu’ils aient le pouvoir de conf6rer aux
acqu6reurs des biens sujets h la fiducie un titre complet de propri6t.
C’est lh une ddrogation aux principes g6n6raux de notre droit civil, mais
c’est une d6rogation voulue par le ldgislateur 2 0
… mais
…
This finding confirms the ownership of the trustee, and makes it
sui generis, but it is a solution that does not totally conform with
the opinion of Rinfret J. in the Curran case, nor does it appear to be
totally justified by article 981a C.C. itself. If the trustee is not the
full owner of the trust property and the beneficiary is not owner
of what remains, there appears to be an inconsistency. The court
attributes this anomaly to the creation of a new type of ownership,
distinct from that of article 406 C.C., a conclusion that is quite
conceivable but not fully warranted by the provisions of the Civil
Code.
In any event, the trust under the Civil Code is clearly to be
distinguished from that arising out of a trust deed for debenture
holders, where property of a debtor is transferred in guarantee to a
trustee for the purpose of receiving a debt. The Supreme Court has
held that these trusts are not ordinary trusts and are not equivalent
18Cj., e.g., Guaranty Trust Co. v. The King [1948] S.C.R. 183, 205-6.
1.9 [1958] S.C.R. 216, 224.
20 [1968] B.R. 689, 697-98.
McGILL LAW JOURNAL
[Vol. 25
to common law trusts.2
1 The law of security is the law primarily
applicable to such transfers, and the trust is only an incidental
element of these borrowing agreements.
2. Legal writings
Legal writers have not always agreed with the courts on the
interpretation of the legal nature of the Quebec trust. In fact, there
is much resistance to the judicial conclusions outlined above.
Mignault first held the view that the ownership of the trust
property vests in the beneficiary.2 He changed his mind after the
Curran case, and suggested that the trustee be regarded as the
owner of the property in view of his broad powers of alienation?3
Several subsequent writers also support Mignault’s view that the
trustee is the owner of the trust property, although he must be
s qualit. 24 Many practitioners prefer this ap-
seen as an owner
proach because it enables them to rely on the earlier judicial pre-
cedents, and because of its similarity to the Anglo-Canadian trust.
B. The beneficiary as owner
While fewer writers have suggested that the property of the
trust vests in the beneficiary of the trust, this theory has been
strongly supported by at least two Quebec authors 25 The principal
reasons prompting this solution are that the trustee has powers
of administration over the property, but has no rights in it. The
capital beneficiary is said to be the ultimate owner because he is
the person intended by the trustor to receive the property when
the administration of the trust is terminated. No cases have been
found in support of this view?6
21 See Lalibertd v. Larue, supra, note 9, 17-18.
22 Mignault, Droit civil canadien, supra, note 14.
23 Mignault, A propos de fiducie, supra, note 14.
24 Lavall6e, Donation fiduciaire (1932-33)
II (1963) 5 C. de D. 57.
11 R. du D. 227; Graham, Some
Peculiarities of Trusts in Quebec (1962) 22 R. du B. 137; Dussault, La fiducie
dans le droit qudbdcois –
25 Billette, A propos de fiducie (1932-33) 11 R. du D. 38 (comment upon the
decision of the Quebec Court of Appeal in Curran); Billette, Au sujet des
origines historiques de la fiducie (1932-33) 11 R. du D. 365; Billette, La fiducie
(1933) 12 R. du D. 159; Mankiewicz, La fiducie qudbdcoise et le trust de Com-
mon Law (1952) 12 R. du B. 16. See also Jobidon, Commentaire sur la fiducie
(1928) 30 R. du N. 215 and 225.
26 To the author’s and editor’s knowledge, no case has differed from the
conclusions in the Curran case.
19801
THE TRUST IN QUEBEC
C. The trustor and his heirs as owner
Another theory on the theme of ownership has been advanced
by Mettarlin in a thorough piece of research on the historical and
civilian background of the Quebec trusty This interpretation of
the articles on the trust of the Civil Code removes the matter of
ownership from the machinery of the trust by relying upon two
concepts –
suspended ownership and a new real right relating to
the administration of the property. It is said that where a con-
veyance is made under a trust, a right of ownership opens in favour
of the ultimate capit l beneficiary. However, this right is suspended
by a condition.28 If the condition is satisfied by events, the right
is made absolute; if it is not satisfied, the transfer to the capital
beneficiary is void and the property is recovered by the trustor-
or, if he is dead, by his heirs. It is therefore said that the remote
owners of the property are, throughout, the trustor and his heirs,
but that their ownership ceases on satisfaction of the condition.
Their ownership is also devoid of all enjoyment; the right to en-
joyment arises only if the suspensive condition is not satisfied.
During the period of the trust’s existence, however, the trustee has
absolute rights of possession, control and alienation with respect
to the trust property; the heirs of the trustor, the trustor and the
beneficiaries, whether income or capital, must comply with the
trustee’s decisions. Mettarlin therefore sees the administration of
the trustees as a new form of real right, a dismemberment of full
ownership, and lasting for the duration of the trust.
This theory of the trust brings us back to the old French law in
so far as it assimilates, in large measure, the position of the trustee
to that of the testamentary executor. But the idea of seeing a dis-
memberment of ownership in an exclusive power of administration
is new and, even though not outside the concepts of the civil law,
it does not necessarily follow from the text of articles 981a through
981n C.C. In any event, in the Quebec legal system, it is not necessary
to have a real right in property in order to confer exclusive powers
upon an administrator. This can be done merely by adeclaration of
the law (for example, a legal mandate) and is done in many parts
of the Civil Code.29 The main point of Mettarlin’s theory is to state
27 Mettarlin, supra, note 4.
2A E.g., “in trust for my wife for life, and then for my son, Pierre, on his
attaining his fortieth birthday”.
29 E.g., in relation to guardians (arts. 290 et seq.), condominium managers
(arts. 441q et seq.), testamentary executors (arts. 905 et seq.), and sequestra-
tors (arts. 1817 et seq.).
McGILL LAW JOURNAL
[Vol. 25
that the trustee is not an owner, but merely an administrator with
full and exclusive powers.
The idea that the heirs of the trustor (or the trustor himself)
remain owner until the opening of the ultimate right of the capital
beneficiary has one major weakness. Indeed, this interpretation (as
in one possible view of substitutions) is based on the doctrine of
conditions: one person is owner under a suspensive condition (the
capital beneficiary, or the substitute) and another is owner under
a resolutive condition (the heirs of the settlor, or the institute).
When the condition is satisfied, or when it fails, one of these per-
sons is declared the owner, not only at that time but for the whole
period, and he is deemed to have been the owner during the in-
tervening period 0 Under a trust, however, there is no such condi-
tion. The right of the capital beneficiary is not a conditional right;
it is only an eventual right, as is that of the person in whose favour
the reversion takes effect. There is no condition and therefore no
retroactive effect. The consequence of this is that an owner has to
be found during the existence of the -trust, yet neither of these
persons qualifies. The capital beneficiary does not qualify because,
by definition, his right does not open at all before the trust instru-
ment so provides – he has no right in the property before that time.
The heirs of the settlor do not qualify because the settlor has .to
transfer his property in the first place in order that there be a
trust.3 It is difficult to see how he could transfer it and, -at the same
time, retain his ownership, albeit conditionally. When the reversion
takes place, there is a new transfer of the property by the trustee
to the person entitled to it, but there is no retroactivity.3
D. The trust as oi’ner
The impossibility of attributing a full right of ownership in the
trust property to either the trustor, the trustee, or the beneficiary
has led to another interpretation which consists of isolating the pro-
perty and identifying a separate entity as its owner. This solution
has taken a variety of forms, but they all can be traced to one
principle: the personification of the trust. Seen as a legal person,
the trust owns the property under the exclusive and absolute
30 Art. 1085 C.C. provides that “the fulfilment of the condition has a re-
troactive effect from the day on which the obligation has been contracted”.
31 See art. 981a C.C.
32 See Reford v. National Trust Co., supra, note 20, 699.
33Art. 9811 C.C.
1980]
THE TRUST IN QUEBEC
management of the trustee who accordingly has full administrative
powers. The beneficiaries have personal rights only.
This idea was advanced by the French jurist Lepaulle who first
suggested a form of patrimoine affectd (an independent patrimony,
without an owner)3 4 for the trust property and then, at a later stage,
proposed that the trust itself be considered -an ordinary legal per-
son.35 It was also developed by Faribault as an outgrowth of the
notion of “Institution”, itself developed earlier in France 6 The
basis for this solution is quite simple. The Civil Code does not
olearily attribute ownership to either the trustee or the beneficiary;
on .the contrary, both suffer important Jimitations on their rights.
Moreover, the Code refers to “the property of the trust” and to
“the trust” as though it were a separate entity. Finally, this solution
has none of the shortcomings or difficulties of the other theories.
It seems quite clear, in view of the diverse theories on the
present law of trusts in Quebec 37 and of the fragmentary character
fiscal et en droit international (1932).
34 Lepaulle, Traitd thdorique et pratique des trusts en droit interne, en droit
35 Lepaulle, “La Notion de ‘trust’ et ses applications dans les divers syst~mes
juridiques”, in Unidroit, Actes du congras international de droit privd (1951),
vol. 2, 206.
36Faribault, supra, note 1, 128. A more detailed analysis of this solution
is found in the author’s doctoral thesis: Caron, The Trust for Bond-holders
in the Province of Quebec (unpublished D. Phil. thesis, Oxford, 1964).
37Another theory would use the stipulation pour autrui of art. 1029 C.C.
This is not a new proposal, and it was dismissed by Faribault in his study,
supra, note 1, 88 et seq. The main difficulty with the stipulatio -is that at no
time does the trustee benefit from, or profit by, the trust or the conveyance
of the trust property; the person taking the stipulatio does benefit. More-
over, whether or not the instrument which creates a trust can be called a
“contract”, it is obvious that the intention of the trustor is not to enter
into an agreement with the trustee, but to affect propertyt for the benefit
of the beneficiaries. The trustee is an intermediary, one who undertakes to
carry out the trust and to administer for the benefit of the designated
beneficiaries; he owes no obligation to the
trustor, as does the promisor
under a stipulatio.
Likewise, the trustor is not an obligee as regards the trustee, the latter
having no relation with him except that of accepting the trust and of
claiming possession of the trust property once it is constituted. Whereas
the beneficiary of a stipulatio has the privilege of accepting it personally
and whereas the stipulator may revoke the stipulatio until it has been ac-
cepted (art. 1029 C.C.), it is quite clear that the acceptance of a trust by the
trustee binds all other parties: Curran v. Davis, supra, note 9, 305.
Finally, the beneficiary of a stipulatio has a personal action against the
promisor, who is his debtor and must perform the terms of the agreements.
The trustee is under no such obligation; he is not the immediate debtor of
the beneficiary and never incurs a personal liability in the normal course
McGILL LAW JOURNAL
[Vol. 25
of the provisions in the Code, that legislative reform is necessary.
Judging by the operation of the Quebec trust in practice, there are
only a few matters in need of clarification or development: certainly
the legal nature of the trust should be defined more precisely and
the trust should be extended to cover situations other than gifts
and wills. With respect to the legal nature of the trust, it is to be
hoped that the new Quebec Civil Code will determine clearly the
owner of the rights involved. For this purpose, only two major
avenues remain open: ownership by the trustee and the personifica-
tion of the trust.
III. Revision of trust law in Quebec
The choice of a legal definition of ‘the trust lies between two
options: “trustee” ownership and “trust” ownership (personality).
The Law of Trusts Drafting Committee of the Civil Code Revision
Office3 8 which commenced work in 1973, started with the first
option. It provided that the trust property would be owned by
the trustee, although this ownership would not be full and absolute
in the sense of article 406 C.C. A new concept of “fiduciary owner-
ship” was introduced. The limitation of the trustee’s ownership
the trustee, as trustee, was denied all
took two main forms:
personal rights of enjoyment in the property, and the property
of the trust was said to constitute a separate patrimony in the
trustee.
The provisions of the first draft covered not only the nature
of the trust, but also its formation, operation, and termination,
and these provisions were honed as
they went through three
successive versions. But problems remained with the theoretical
rudiments of the new trust. If the trustee had no personal right of
of his administration. The beneficiaries are not really third parties, even
when they are not parties to the trust deed, or when they do not exist at
the time of the deed; their assent is given by the trustee as their repre-
sentative and only in that quality, not as an independent third party. Even if
one were to say that the trustee is the owner of the trust property, there
could not be a true stipulatio, because the trustee, by definition, takes no
advantage from the trust.
38The Committee members were the late Professor Y. Caron (Chairman);
Wainwright Professor P.-A. Crdpeau, President of the Civil Code Revision
Office; Professor J. E. C. Brierley, who prepared the first three drafts;
Gale Professor (as he then was) D. W. M. Waters, who acted as consultant;
and, in the later stages of the work, Me (now Professor) Madeleine Cantin
Cumyn. This Committee concluded its principal work in the spring of 1976,
but the drafting continued into the spring of 1977 after the intellectual
journey narrated in Part III by Professor Caron. –
J.E.C.B.
19801
THE TRUST IN QUEBEC
enjoyment in the property, where did the fructus lie? Moreover, if
the trust property constituted a separate patrimony in the trustee,
this was surely tantamount to saying that there were in him two
persons, which, it could be argued, amounted to personifying the
trust.
At this point the writer assumed the task of preparing a fourth
draft and in -this version, which was completed in December 1974,
the second option (trust ownership) was adopted. What follows is
an extended extract from the draftsman’s comments upon that
draft, at the point where the nature of the trust as a personified
entity is developed. The draftsman’s comments, intended for those
members of the profession in the province who were later asked
to give an opinion upon the new draft, review the dilemma faced
by the Committee, and the conclusions drawn by the draftsman.
A. Fiduciary ownership and its deficiencies
Were the law to see the trustee as a fiduciary owner of the trust
property, it would also have to hold that the trustee could have
no personal right of enjoyment and that he could not confound the
trust property with his own (the trust property being vested in ‘him
as a separate patrimony); nor could the trust property, like his
own, pass to his heirs or legal assigns. This kind of ownership
would thus depart from classical civilian notions. A numrber of
conceptual and practical questions would moreover be left un-
answered by this approach.
1. Enjoyment
On the basis of a “fiduciary ownership”, the trustee would be
vested with “ownership” without enjoyment. But, as contrasted
with usufruct, this conception of trust does not make the trustee
“bare owner” while the beneficiary has enjoyment. Under a trust
it is, of course, desirable that the beneficiary have no real right
whatever in the trust property; but, if the trustee were vested with
“fiduciary ownership”, the vesting of residual rights of property
(enjoyment), if not in the beneficiary, remains unclear.
2. Successive trustees
Should the trustee be “fiduciary owner”, a serious difficulty
arises concerning the continuation of fiduciary ownership where
the trustee resigns, dies, disappears, or is removed. The property
has to be transferred from one trustee to another and a fiction
McGILL LAW JOURNAL
[Vol. 25
would have to be used to cover the gaps between the effective
cessation of one trustee’s powers and the appointment of his suc-
cessor. Moreover, it is now expressly intended, as a matter of
present positive law, that the trust property will not pass to the
trustee’s heirs (article 981e C.C.).
3. Legal nature
The most considerable difficulty arising from the concept of
fiduciary ownership in a civilian context relates to the very identifi-
cation of the legal nature of the trust. In its simplest terms, what
rules of interpretation will be applied to the new law of trusts by the
courts and others? Will resort be had to common law (including
equity) precedents in matters of interpretation? Is it realistic
to leave open the implication that, by mere use of the word “trust”,
we are referring to centuries of jurisprudential experience in the
English courts of law and equity, and are thereby permitting the
Quebec law of property to be influenced by the same rules and
approach? Our courts have had to discuss this question before in
relation to articles 981a through 981n C.C., and they have con-
cluded that, although the machinery of the trust comes from the
common law (and equity), it does not mean that all the rules of
England relating to trusts apply in Quebec 9
Having attempted to follow the common law spirit as much
as possible by borrowing the notion of fiduciary ownership, the
authors of the earlier draft, when confronted with the prospect
of a notion of “split ownership” (legal title and equitable title)
flowing from it and possibly involving the importation of this
mass of precedent, were unwilling to take up formally such a
position.
B. Trusts having legal personality
In the present writer’s view, the use of legal personality supplies
a more civilian approach to the problem. This solution appears to
answer most of the problems raised by the introduction of trusts
into a civilian context and raises fewer problems of its own.
One might say that trusts came to English law almost as an
historical accident in medieval times. The concept has been flexible
enough to be used to this day in common law, jurisdictions to
39 E.g., Curran v. Davis, supra, note 9, 301; Lalibertd v. Larue, supra, note 9,
16 and 18.
19801
THE TRUST IN QUEBEC
support many new arrangements concerning property and groups
of persons. One may similarly observe that civil law countries have
also managed to adapt to many of the same situations through the
use of a quite different concept, that of legal personality. From
a civilian point of view, the personification of the trust appears to
be a -logical and normal development. Indeed, one only has to
observe the treatment of fondations, socidt~s (partnerships), comitds
d’entreprise, and masses des obligations in modem French law to
verify this trend. If we examine the essential purposes of the trust,
the use of the concept of personality in a civilian jurisdiction will
be seen to be appropriate.
1. Purpose of trusts
For the authors of the draft, the question was not just a matter
of opting for one theory or another. Their task was to broaden the
scope of the Quebec trust (as contained in articles 981a through
981n C.C.) While bringing some clarification to the concepts used.
In making the trust available for more putiposes, it had to be
harmonized fully with other provisions of Quebec law.
What, then, is to be expected of a trust? Is it fair to say that
one of the major aims of a trust is to divest the trustor (or the
transferor) of property, while ensuring that the property does not
vest in the beneficiary? If so, one may also say that the other major
purpose of a trust is to place the property under the administration
of a trustee who is responsible for the performance of the terms of
the trust. We are not contemplating situations where a trust is used
simply as an alternative to the contrat de prate-nom or to the con-
tre-lettre in order that one person may appear to be the owner While
he has secretly agreed to own for -another.
What is ieally sought in a trust is, plainly, a machinery of
administration. The trustee is expected to treat the trust property
not as his own, but as that of another: he must apply the standards
of loyalty, honesty, care, skill, and diligence implied in the duty of
administration of the property of others; he may not persondlly
enjoy the fruits or advantages of the property; the property does not
pass to his own heirs; and the trustee may be removed from office
upon motion. These are not the characteristics of ownerslp; nothing
in the trust indicates or requires that the trustee be the owner of the
trust property.
On the other hand, it is expected that the trustee will, unless
otherwise instructed by the trustor, exercise the broadest powers
and that he will be entitled to act, with respect to the property,
McGILL LAW JOURNAL
[Vol. 25
as if he were the owner. But acting as an owner does not mean
that one is owner. This is the position of many kinds of administra-
tors of the property of others: company directors, mandataries, and
testamentary executors are typical examples. Yet, in each of these
cases, no one would suggest that the director, the mandatary, or
the executor actually owns the property placed under his adminis-
tration.
Why then should the trustee be regarded as an owner? The only
obvious answer has been stated above: because it is intended that
neither the trustor nor the beneficiary be vested with ownership
of the trust property. Faced with this dilemma, and taking into
account the fact that the trustee must not be seen (qua trustee) as
a beneficial owner of the trust property, the common lawyer has
a solution: fiduciary (legal) ownership. The civilian, however, has
yet to be able to visualize such a new form of ownership; where .it
becomes imperative that property not vest in particular individuals,
and when a common purpose or interest arises with respect to the
property, his idiosyncrasy suggests “legal personality”. Historically,
the use of legal personality has evolved as the civilian counterpart
of the English trust.
2. Civilian institutions and the trust as a legal person
In modern times, estate planners, traders and businessmen have
made the broadest possible use of existing institutions in order to
achieve -their goals. However, their ingenuity has been limited to
the further testing of old tools. Basically there are three institutions
available which may be vested with property rights: the corporation,
the partnership, and the trust. This trilogy has been the bread and
butter of the common law planner. To him, the three are based on
different legal concepts, are subject to different legal rules, and
serve different purposes. In this context, he knows that legal per-
sonality is a feature of the corporation, a feature quite useless to
him where other situations are concerned. The civilian has also
known equivalent mechanisms without, however, the trust. For
many situations the concept of ownership was flexible enough; it
allowed usufruct, rights of habitation and substitutions to take
their place within his system. Quebec law, -immobile for so long on
these matters, was nevertheless augmented in 1879 by a form of
trust to be used as an alternative mode of inter vivos gift and in
wills. Seen in the light of article 981b C.C., this trust appears to be
merely another type of administration of the property of another.
French law, more aggressive and faced with more urgent problems,
1980]
THE TRUST IN QUEBEC
has made a liberal use of alternative mechanisms, including legal
personality (the most obvious example being the Jondation).
The crucial difference between the common law and the civil
law approaches to these organizational problems appears to be
the jurisprudential meaning of the concepts used. Whereas, for
example, “property” is a vehicle of rights for the common law
lawyer, it is a fixed and monolithic concept to the civilian. On the
other hand, “legal personality” for the civilian is a vehicle of lights,
whereas the common law lawyer thinks of it as a monolithic con-
cept restricted to the corporation. For example, in the common
law a corporation is a legal person but a partnership is not. In
France, both socidtds anonymes (corporations) and socigtis (civil
and commercial partnerships) have legal personality.
To the civilian, an artificial legal persdn is simply a subject of
rights and duties. The form and the purpose of the arrangement may
vary, the responsibilities of those involved may change, but at all
times property rights are vested in a legal person. To illustrate this,
let us compare corporations, partnerships and trusts.
The main characteristic of the corporation (the business cor-
poration) is its total independence from its members and its per-
petual duration. The property and funds vested in the corporation
are totally separate from those of its members and are exclusively
devoted to the corporate objects. The corporation, being a legal
person, is a subject of rights and duties and can hold property –
but its real purpose is independence of control. Legal personality
alone cannot achieve this because such independence of control is a
feature not of legal personality but of corporate personality.
Partnerships, on the other hand, are also seen by civilians as
legal persons for purposes, inter alia, of holding assetsi carrying
on business and litigating. Their purposes and main characteristics
are different from those of corporations. Partnership does not
require total independence or separation of the legal person from
its members. Persons are the main feature of partnership, and the
agreement is said to be intuitu personae in such a way that, if one
partner dies or retires, the others have to agree to keep the partner-
ship in existence. The partnership, as a legal person, is a vehicle to
hold property but the persons-members predominate.
The parallel may be extended to trusts. The main characteristics
of the trust are to divest the trustor of his ownership, to place the
property under the administration of the trustee, and to make sure
that the beneficiaries have no rights in the trust assets while the
property is administered for their benefit (or for a purpose). The
McGiLL LAW JOURNAL
[Vol. 25
* trust, as a legal person, is a vehicle used for holding property, but
the directions of the trustor and the benefit of the beneficiaries are
its main features. Total independence is not sought: the beneficia-
ries’ interest must remain predominant. There is, however, an effec-
tive separation of, in the first place, ownership and beneficial
interest, and, in the second place, ownership and management.
This result has been seen by some of the leading civilian writers
on trusts. Lepaulle, whose concept of patrimoine affect640 was a
departure from the traditional common law approach to trusts,
wrote:
Il y avait, me semble-t-il, une autre route 5. suivre, plus fid~le au trust,
plus assimilable et plus facile A manier. Elle consistait h faire du trust
une personne morale, dont le trustee serait le g6rant, la charte du trust
6tant constitude par l’acte constitutif, les tiers 6tant prot6g6s par une
inscription h un registre ou h une publicit6, le minist6re public 6tant
charg6 de la surveillance des trusts au profit d’incapables ou consti-
tuant des fondations.41
Applied to trusts, the notion of legal personality solves most of
the major difficulties exposed above: property rights vest in the
trust rather than in the trustee and, consequently, there is no
problem with residual rights or transfer of rights in case of substi-
tution of trustees. It might have been possible to provide that
residual rights would not vest at all, but this would have seriously
encroached upon the concept of ownership. It might also have been
possible to say that ownership vests retroactively in the substitute
trustee in order to fill the gap, or to have these rights vest in the
Public Curator where there is a delay in the appointment of a
successor trustee. But these appeared to be patching-up solutions,
more artificial than the idea of legal personality whidh brings
stability throughout the entire existence of the trust. Finally, one
has to admit that the “split ownership” trust of the common law
and the “legal-person” trust proposed in the civil law both rely upon
legal fictions.
It is suggested that, from a civilian point of view, these two
theories are but one in reality. For example, let us assume -that the
trustee were the owner (fiduciary owner) of the trust property. It
is understood that this ownership brings him no personal right of
enjoyment; the trust property has to be segregated in his hands; and
it is necessary to declare that trust property is a separate patrimony
in the trustee. Translated into civilian jurisprudential language,
4 O Lepaulle, supra, note 34.
4 1 Lepaulle, supra, note 35.
1980]
THE TRUST IN QUEBEC
this means that the trustee possesses a dual personality: his own
person and a person s qualitd as trustee. Effectively, the fiction of
the law operates to “personalize” the trustee who has fiduciary
ownership. The same result is obtained under the legal personifica-
tion of the trust, with the mechanical difference that the trust,
rather than the trustee, is personalized. This has the advantage of
making the trustee an administrator who can be replaced inde-
finitely without disturbing the stability of the trust. It also has the
advantage of keeping the notion of absolute ownership intact.
Thus, from a civilian point of view, the net result is jurispru-
dentially identical in both cases, and it is only a matter of labelling
the thing created. Moreover, the route of legal personality has some
advantages over the other with respect to ownership and adminis-
tration –
it provides both continuity and flexibility. It may be
noted finally that the -definition of the legal nature of the trust
has no effect on the other provisions in the proposed new Civil Code
chapter on trusts. In fact, all the other provisions are exactly the
same, regardless of a definition. One main advantage is, however,
gained: any reference to the trust would now have full legal mean-
ing.
IV. Conclusion
Since the circulation of the fifth draft to various members of
the Quebec profession for their comments, a variety of responses
has been received and these are now being considered. Some are
primarily concerned with the tax implications of the proposed
articles, others with civil law doctrine, and still others reflect
the views of those who participate in trust and securities busi-
nesses across Canada. While Quebec is a civil law island in a
substantially common
law continent, business practices across
Canada tend to be uniform and there is a strong preference in
many quarters for the maintenance of the highest possible degree
of uniformity. It is interesting to note that the idea of trust per-
sonification has been rejected in Louisiana which preferred, in
1964, to make the trustee owner of the trust property. 42
It is quite apparent that to call a trust a legal person is a radical
change for those familiar with the Anglo-Canadian trust. However,
as explained above, it makes very little difference whether the
property vests in the trust or in the trustee, because the trustee is
42 See Louisiana Trust Code 1781.
McGILL LAW JOURNAL
[VCol. 25
always understood as owning the property, not for himself, but as
a separate patrimony.
The ultimate goal is to define the trust not in terms of owning
or of transferring property but as a mode of administration under
which the trustee has the fullest powers under the law and the
terms of the particular trust instrument, This formulation is the
only way of reconciling the different notions of trust which exist
in various jurisdictions, especially where civil law and common law
principles meet and sometimes clash. In any event, the civilian
needs a codification of the law of trusts which enables him to
avoid recourse to the common law and the mammoth number of
precedents which it involves. This purpose will not be achieved
unless the notion of trust is reconciled with the basic concepts of
the civil law.
Editor’s Post Scriptum
J. E. C. Brierley*
It is appropriate to complete the account provided by the late
Professor Caron in Part III of his article with a brief post scriptum
in order to record the final thinking of the committee charged with
proposing the reform on the subject of the trust. The concept of
“fiduciary ownership” which rested upon the prinoiple of a separa-
tion of patrimonies in the trustee was developed in the first three
drafts of the committee.43 This approach did not resolve the matter
of the localization of the beneficial dimension of ownership or the
vesting of the title of owner (dominium) as defined by article 406
C.C. It was therefore abandoned, principally upon Professor Caron’s
initiative, in the subsequent drafts in favour of attributing legal
personality to the trust itself. Caron’s thinking on this possibility
had already been traced by him in earlier writings. 44
The concept of legal personality for the trust, on the basis of
the ideas expressed here, was developed by Caron in the drafts
prepared in 1974.’ 5 To affirm, as article 4 of the fifth draft did, that
* Sir William Macdonald Professor of Law, Faculty of Law, McGill University.
Prepared in May 1973, October 1973, and April 1974.
44 Caron, “Les associations et groupements ddpourvus de la personnalit6
juridique en droit civil et commercial qub6cois” in Travaux de l’Associa-
tion Henri Capitant (1969). t. XXI, 181.
45 The fourth draft was prepared in August and the fifth in December of
that year.
1980]
THE TRUST IN QUEBEC
“a constituted trust is a legal person” was seen by him to be a safer
conceptual framework within which to place the trust in the Quebec
context. The trust itself would be vested with the dominium of the
trust property and the trustee, like the director of a corporation,
would have the administrative power to deal fully with it. However,
this notion was not well received by those to whom the revised
draft was referred for opinion. The resort to legal personality was,
if anything, found by many to be even more artificial than fiduciary
ownership. The Caron proposal suggested a mold for the trust
that was unfamiliar to those in the business milieu and it did not
correspond to the vision of the trust that had come to be accepted
by the courts, however awkwardly this vision was poised within the
traditional civilian principle of ownership. Why, indeed, it was
asked, retain the trust at all if it was only to exist in personified
form? Should not the trust be viewed as an alternative to, rather
than a duplication of, the path of corporate personality?
Therefore, the sixth draft46 marked a partial return to the
earlier analysis. Legal personality for the trust and fiduciary owner-
ship were suggested as alternative general solutions, but personality
alone was proposed as the framework for trusts created for a public
interest; article 6 of this draft adopted the continental French
terminology of fondation for such purpose trusts. Even here, how-
ever, no truly useful purpose was seen to attach to this new
clothing for a purpose trust;47 the anomalies of ownership involved
in these trusts, although even greater than those involved in trusts
for persons, had not prevented the courts -from giving to them full
effect. All reference to legal personality was therefore dropped from
the final published -version of the texts of the drafts. +8
The final, official and published version4 9 of the draft articles
therefore makes no reference to legal personality in regard to
purpose trusts or those constituted for the benefit of persons,”0 nor
does it expressly refer to fiduciary ownership. Ar-.icle 600 provides
46 Prepared in March-April 1976.
47 See art. 869 C.C. The purpose trust envisaged by art. 6 of the draft was
a somewhat expanded version.
48 Reports XLIV, June 1976, and XLV, 1977.
41 Civil Code Revision Office, Report on the Quebec Civil Code (1977), vol.
I, Book IV, arts. 600-638; vol. II, t. I, 523-31.
50The commentary to draft article 488 (vol. II, t. I, 505) refers to “a
trust” as though it were a person, but even the present law adopts this form
of expression (cf. art. 981b para. 2, art. 981c C.C.) without forcing the con-
clusion that either the trust of art. 981a and or that of art. 869 C.C. is
endowed with legal personality.
McGILL LAW JOURNAL
[Vol. 25
that a trust is constituted when a person “transfers property to be
held for the benefit of a person or the fulfilment of a purpose”.
Article 602 merely specifies that the trust “must be accepted by the
trustee”. Article 603 declares:
Les biens
forment un patrimoine distinct.
Property transferred in trust con-
stitutes a patrimony which is dis-
tinct from that of the trustee.
transportds en fiducie
Article 624 makes clear that the trustee has the fullest possible
powers of administration over the trust property.51
Given the theory of the patrimony deriving from the nineteenth
century jurisprudential thought contemporaneous with the drafting
of the Civil Code, 52 statutory recognition that the trust property is
distinct from the trustee’s own property appears to be an essential
requirement for the operation of the trust in the Quebec context.
But what of ownership of the trust property? If neither fiduciary
ownership nor personality for the trust are explicitly adopted, how
does the final draft resolve the matter of the coexistence of the trust
with the exigencies of the traditional principle of ownership?
The answer is simply that it does not resolve this question at
the level of explicit textual expression. In this regard the proposed
texts mark no apparent advance over the existing legislation. But
are they, for all of that, unsatisfactory because this matter of
6 These are provided in draft articles 487-550 which constitute a codifica-
tion of all the principles related to the administration of property belonging
to other persons and deal with custody (la garde), involving the obligation
to conserve; simple administration (la simple administration), involving the
obligation to perform acts that maintain property in good repair; and full
administration (la pleine administration), which imposes the obligation to
make it productive.
52 Aubry & Rau, Cours de droit civil franqais d’apras la m~thode de Zacha-
riae 5e 6d. (1917),
t. IX, 333-39, 349-52. Among these celebrated principles
relating to the unity and indivisibility of the patrimony is that which states
(at p. 336): “Que la m~me personne ne peut avoir qu’un seul patrimoine,
dans le sens propre du mot”. Certain exceptions recognized in French law
apply in Quebec law as well, such as legacies by general title (art. 873
C.C.), the effects of benefit of inventory or separation of patrimonies in the
law of succession (arts. 671 and 743 C.C.), the legal return of property to
ascendant relations (art. 630 C.C.), reserved property of married women
(arts. 1425a et seq.) and, it must be especially noted, the case of “les biens
compris … dans un fid6icommis universel ou h titre universel [qui] for-
ment une universalit6 juridique distincte du patrimoine du … fidmicommis”
(p. 339). The fact that the elaborate theoretical construction of Aubry and
Rau on this matter has been contested by more recent writers does not lessen
the need for a clear legislative articulation of the principle of such separation,
which the force of intellectual tradition in this connection would probably
otherwise deny.
19801
THE TRUST IN QUEBEC
seeming fundamental principle is not legislatively formulated? I
think not. Under the present law, as judicially interpreted, the title
to the trust property can be viewed as vesting in the trustee for
the duration of the trust – not, of course, for his beneficial en-
joyment but only in trust until such time as there is remission by
him to the entitled capital beneficiary. This. is clearly suggested in
the present jurisprudence. Although Rinfret J., in Curran v. Davis,
qualified the trustees as only “apparent” owners with regard to
third parties, and held that they do not have “title” even though the
trust property is in their names with “L peu pr~s tous les droits du
propri6taire”, the context of his remarks shows that he was de-
monstrating only that their position was one that did not inure to
their own benefit.5 3 The idea was put more clearly by Salvas J. in
Reford v. National Trust; he stated that the ownership of trust
property is transferred to trustees, since it cannot be in suspense,
but that their ownership is not that of article 406 C.C.
In other
words, the ownership of the property is “reposing” in the trustees
in trust. The power of the trustees to act derives not from the pro-
position that they are regular owners or persons vested with some
new species of real right, but rather from the fact that the function
of trustee carries with it most of the attributes of power normally
associated with ownership. This point has been obscured be-
cause one is drawn to use the language of “rights”, associated with
owners, when one is referring to the “powers” of trustees. But it
is surely no great violation of any root principle in the civil law to
affirm, as a gloss upon both the present and proposed texts, and as
Mignault stated over forty-five years ago, 5 that the trustee has the
right/power or title of an owner, except as to the benefit, for the
purposes of the trust. The position, so stated, is hardly a new one
in view of the long-standing acceptance of the purpose trust of
article 869 C.C. The fact that the fructus vests neither in the trustee
nor in any other person does not constitute an obstacle to the
acceptance of the trust within the civil law, as it is not the only
instance where a prerogative of ownership (as provided in article
406 C.C.) is denied the owner.3 6
53 Curran v. Davis, supra, note 9, 293, 305.
4 Supra, note 20, 697.
5 Mignault, A propos de fiducie, supra, note 14, 76: “[Le 16gislateur] pou-
vait … faire reposer le titre de propri6t6 sur la t6te du fiduciaire pendant
la fiducie … J1 n’est pas n6cessaire pour cela de suivre le 16gislateur anglais
dans la distinction qu’il fait entre la propri6td 16gale et la propri6t6 6quitable,
il suffit d’accepter le r6sultat que la loi anglaise consacre”.
6 Cf. arts. 968 et seq. whereby the owner of property may be denied the
abusus. Restrictions on the usus are numerous.
McGILL LAW JOURNAL
(Vol. 25
Indeed, this analysis, which also can be articulated under the
present law, is reinforced by an important feature of the draft which
marks an advance over the present texts. After much debate on the
intrinsic merits of the idea and whether the present law was already
to the same effect, it was decided by the drafting Committee that not
even a first beneficiary need be in existence at the time of the
constitution of the trust. Draft article 633 provides that the bene-
ficiary’s right must open not later than ninety-nine years after the
trust is established. Therefore, a beneficiary need not, even as the
institute in a substitution, be in existence at the time of the creation
of the trust in order that the title to eventual ownership of the
property be seen to repose in him rather than in the trustee.51
The proposal to include within the range of possible beneficiaries
a future (but specified) person not in existence at the time of the
constitution of the trust might have prompted the final working
committee to follow through to the logical consequence that title
vests in the trustee at the creation of the trust. But it refrained from
doing so and the problem of the coexistence of the trust mechanism
and civilian principles of ownership remains under the proposed
texts as much as under those now in force. In the final analysis,
one can only conclude that some matters are better left unsaid, even
in the work of law reform.
5′ This provision was settled in committee even before the Superior Court
decided Tucker v. Royal Trust Co. [1976] C.S. 895 per Mackay J. Tucker was
approved by Fyshe v. Royal Trust Co. C.S. Montreal, Jan. 7, 1977, no. 500-05-
019922-762 per Meyer J. But cf. Harood v. Moncel (1923) 61 C.S. 497. In the
light of arts. 771 and 838 C.C., the issue is clearly more arguable under the
present law in respect of trusts by way of legacy than it is in respect of
trusts by way of gift.
