Test: Indian Trust Act,1882 - CLAT PG MCQ

When the beneficiary is a minor, the trustee is responsible for managing the assets and using the funds for the minor's necessities. This duty ensures that the minor's interests are safeguarded until they reach adulthood.

The categories of trusts discussed include Private Trusts, Public Trusts, and Express Trusts. A Conditional Trust is not recognized in this context, highlighting the various established classifications in trust law.

A trustee can delegate their responsibilities only if the trust document allows it or if the beneficiary consents. This limitation ensures that the trustee remains accountable and prevents misuse of power.

If a trustee becomes unfit to act, the trust does not dissolve. Instead, a new trustee can be appointed to continue managing the trust, ensuring that the interests of the beneficiaries are protected.

The settlor is the individual who establishes the trust, designates the property for it, and defines the terms of the trust. This role is crucial as it sets the foundation of the trust relationship.

The "Instrument of Trust" is the formal document that establishes the trust, outlining the intentions of the settlor and the details regarding the trustee and beneficiaries.

The trustee has a fiduciary responsibility to manage and hold the property for the benefit of the beneficiaries. This relationship requires the trustee to act in good faith and in the best interests of those they represent, rather than for personal gain.

A constructive trust is imposed by the court in situations where one party has wrongfully obtained property through an abuse of trust or confidence. This legal remedy ensures that the property is held for the rightful beneficiary.

Section 6 of the Indian Trust Act outlines the essential elements required for the valid creation of a trust, including certainty of intention, object, property, and lawful purpose.

A fundamental difference lies in the fiduciary duty; a trustee is legally obligated to act in the best interests of the beneficiaries, while an agent acts on behalf of a principal with no such obligation to third parties.

If a trustee wrongfully purchases trust property, the beneficiary can compel the trustee to reconvey the property back to the trust. This ensures that the trust property remains protected and used for its intended purpose.

A public trust is designed to benefit the public at large or a particular community, while a private trust benefits specific individuals or a defined class of beneficiaries.

In a discretionary trust, the trustee has the authority to determine how much income, if any, to distribute to each beneficiary. This allows for flexibility based on the beneficiaries' needs or circumstances.

Beneficiaries have the right to inspect and obtain copies of trust documents, ensuring transparency and accountability regarding the management of the trust property.

For a trust to be valid, there must be a clear intention to create the trust, a definite object or purpose, and certainty about the trust property. These elements ensure the trust is enforceable and serves its intended purpose.