TRUST FUND DOCTRINE. See STOCK HOLDER.
A person in whom some estate, interest, or power in or affecting property of any description is vested for the benefit of another.
One to whom property has been conveyed to be held or managed for another.
To a certain extent, executors, adminis trators, guardians, and assignees are trus tees, and the law of trusts so far is appli cable to them in their capacity of trustees ; Hill, Trust. 49.
Trusts are not strictly cognizable at com mon law, but solely in equity ; Watkins v. Holman, 16 Pet. (U. S.) 25, 10 L. Ed. 873.
Any reasonable being may be a trustee. The United States or a state may be a trus tee ; McDonogh v. Murdoch, 15 How. (U. S.) 367, 14 L. Ed. 732 ; Holland v. State, 15 Fla. 455; State v. R. Co., 15 Fla. 690; Gibson v. R. Co., 37 Fed. 743, 2 L. R. A. 467. So may a corporation ; Girard v. Philadelphia, 7 Wall. (U. S.) 1, 19 L. Ed. 53 ; Perry, Trusts § 42.
"Whoever is capable of taking the legal title or beneficial interest in property may take the same trust for others." Perry, Trusts § 39. Non-resident natural persons are not disqualified from acting as trustee ; 4 Am. Ry. Rep. 291; an act which declares such person disqualified is in conflict with the federal constitution ; Farmers' Loan & Trust Co. v. Ry. Co., 27 Fed. 146, arguendo; Shirk v. La Fayette, 52 Fed. 857 ; but this con stitutional provision does not extend to for eign corporations.
A foreign ,corporation may be a trustee ; Cook, StoCk, etc. § 813 ; it must comply with local statutes ; Farmers' Loan & Trust Co. v. R. Co., 68 Ill. App. 666; contra, Brown v. El well, 17 Wash. 442, 49 Pac. 1068 ; Garratt Ford Co. v. Vermont Mfg. Co., 20 R. I. 187, 37 Atl. 948, 38 L. R. A. 545, 78 Am. St. Rep. 852. See Saltmarsh v. Spaulding, 147 Mass. 224, 17 N. E. 316. In Farmers' L. & T. Co. v. R. Co., 68 Fed. 412, where a statute of Ill inois declared any trust unlawful when vest ed in a foreign trust, company unless it had complied with certain requirements of the statute, it was held that a trust under a rail road mortgage vested in such a company merely a naked legal title, while the benefi cial title was in the bondholders ; and that the court would enforce the security by a judicial sale. But a nonresident trust com
pany was removed as trustee under an Illi nois railroad mortgage ; Farmers' L. & T. Co. v. R. Co., 173 Ill. 439, 51 N. E. 55. A mort gage upon railroad property in Illinois exe cuted to a foreign trust corporation as trus tee, to secure bonds made payable outside of the state, is not prohibited by the laws or public policy of that state ; Hervey v. R. Co., 28 Fed. 169.
The trustee of a railroad mortgage rep resents the bondholders who are bound by his assent ; Lloyd v. R. Co., 65 Fed. 351. See MORTGAGE; INTERVENTION.
The legislature of a state alone has the power to accept a bequest to the state in trust ; State v. Blake, 69 Conn. 64, 36 Atl. 1019.
A trustee after having accepted a trust cannot discharge himself of his trust or re sponsibility by resignation • or a refusal to perform the duties of the trust ; but he must procure his discharge either by virtue of the provisions of the instrument of his appoint ment, or by the consent of all interested, or by an order of a competent court ; 4 Kent 311.
When the trustee relation is once establish ed, no subsequent dealing with the trust prop erty can relieve it of the trust ; Smith v. Guaranty Co.; 162 Fed. 15, 88 C. C. A. 669.
Trustees are not allowed to speculate with the trust property, or to retain any profits made by the use of the same, or to become the purchasers upon its sale. If beneficial to the parties in interest, the purchase by the trustee may be retained or confirmed by the court. And the trustee may be compelled to account for and pay over to the cestui quit trust all profits made by any use of the trust property ; 4 Kent 438. A trustee can not become a purchaser at his own sale, without special permission; Allen v. Gillette, 127 U. S. 589, 8 Sup. Ct. 1331, 32 L. Ed. 271. A purchase by a trustee of trust property for his own benefit is not absolutely void, but voidable ; and may be confirmed by the par ties interested either directly or by long ac-. quiescence ; Hammond v. Hopkins, 143 U. S. 224, 12 Sup. Ct. 418, 36 L. Ed. 134. See TRUST.