Conflicts And Balance Of Interests In Trust Relationships

Trust is one of the most important laws in the British and American Equity Laws, and plays an important part all the time. Given the advantages, trust system is being adopted by more and more Congenital Legal Systems. In the year 2001, China has enacted the trust law as well, which brought big impact on standardizing behaviors of trust, protecting legitimate interests of parties, accelerating development of trust system, and bringing about prosperous economy. However, compared with the relatively consummate legislation in England, America, Japan etc, China needs to make much further efforts to reach the similar level. The trust system is composed with the client, the trustee and the beneficiary, and the balance between the agents influences the modern course of the trust system. Based on the facts above, this paper aims to make influence on consummation of the Trust Law by probing into the balance issue between conflicting parties under legal relationships.Foreword is a general introduction of trust system and the puzzle which exists in both British and American Legal System and Congenital Legal System. And this part will analyze and solve the proper legal method when dealing with the problem of trust.Chapter 1 is to discuss why conflicts of interest happy in trust relationships. The discussions are on the elements characteristic and ownership of the trust property. Elements of the trust relations are the property of trust, the client, the trustee, the beneficiary, and the right and duty of the parties. This part discusses some basic concepts of trust relations, which are the ownership from the interest, the independence of the property of trust and the limited duty. The positions of the elements in trust relations are discussed basing on the elements'characteristics. The character of the trust relationship and ownership conflicts of interest are problems to be solved when concerning balancing conflicts of interest. This paper suggests that the problem focuses on whether trust relationships are contractual and ownership of property. So this part analyzes and discusses how to solve theses two problems. Trust relationship mostly concerns the thoughts in accordance of the client and the trustee, aspect of function to give the trustee the rights to manage the trust property of the beneficiary. Given the fact, accordance of thoughts exists between the client and the trustee, which indicates contractual. Applying contract rules in trust doesn't affect the basic rules of the trust. On the contrary, it is favorable to eliminate troubles that the trust law cannot get ride of itself.Chapter 2, I analyze the conflict of the interest inside, and divide it into five kinds, these are: the conflict between the client and the beneficiary;the conflict between the client and the trustee;the conflict between trustee and the beneficiary;the conflict between beneficiaries;the conflict between trustees. After the comparison with the right and duty of the parties, it should be suggested that to expand the right of the trustee, strengthen the protection of the beneficiary, make the allotment program of the interests between the beneficiaries, and confine the trustee, in order to balance the interests of the parties.Chapter 3 is to analyze the conflict of the interest outside, and it is discovered that the conflict outside mainly shows the trust property conflict between the parties and the creditors. It is divided into three kinds: the conflict between the client and the its creditor;the conflict between the trustee and its creditor;the conflict between the beneficiary and the creditor. Based on this, considering the Trust Law in China place extra emphasis on protecting the interests of parties, but less protection on the third party, so the Trust Law of our country should strengthen the protection on the third party. The opinion is discoursed in two aspects: one is the passive protection on the third party, which includes the limitation on the client, the trustee and the beneficiary;the other is the active protection on the third one. In view of the effect on protecting the third party, male shows the system can strengthen the more protection.