Easy Table - Trust | Katienza
Express Trust and Implied Trust
Definition
Express Trust Express trusts are those which are
created by the direct and positive acts of
the parties, by some writing or deed, or
will, or by words evincing an intention to
create a trust.
Implied Trust Implied trusts are those which, without
being express, are deducible from the
nature of the transaction as matters of
intent, or which are superinduced on the
transaction by operation of law, as
matters of equity, independently of the
particular intention of the parties.
Kinds
Charitable Trust – designed for the benefit of a
segment of the public or of the public in general.
Accumulation Trust – one that will accumulate
income to be reinvested by the trustee for a period of
time specified.
Spendthrift trust – established when the beneficiary
is inexperienced, immature or prudent with his
spending habits.
Sprinkling trust – gives the trustee the right to
determine the income beneficiaries who should
receive income and the amount thereof.
Resulting Trust – it is a trust raised by implication of
law and presumed always to have been
contemplated by the parties, the intention as to
which is to be found in the nature of their
transaction, but not expressed in the deed or
instrument of conveyance.
Example: Articles 1448, 1449, 1451, 1452 & 1453
Constructive Trust – is a trust not created by any
words, either expressly or impliedly, evincing a direct
intention to create a trust but by the construction of
equity in order to satisfy the demands of justice and
prevent unjust enrichment. It does not arise by
agreement or intention but by operation of law
against one who, by fraud, duress, or abuse of
confidence obtains or holds the legal right to
property which he ought not, in equity and good
Evidence required/How to prove
As a rule, the burden of proving the existence of a trust
is on the party asserting its existence, and such proof
must be clear and satisfactorily show the existence
of the trust and its elements.
The presence of the following elements must be
proved:
(1) a trustor or settlor who executes the instrument
creating the trust;
(2) a trustee, who is the person expressly designated
to carry out the trust;
(3) the trust res, consisting of duly identified and
definite real properties; and
(4) the cestui que trust, or beneficiaries whose identity
must be clear.
Note: Art. 1443 provides that no express trust
concerning an immovable or an interest therein may
be proved by parol evidence.
Implied trust can be proved by parol evidence (Art.
1457) the evidence must be trustworthy and
received by the courts with extreme caution, and
should not be made to rest on loose, equivocal or
indefinite declarations. Trustworthy evidence is
required because oral evidence can easily be
fabricated.
Prescription
General Rule  a trustee cannot acquire by prescription the
ownership of the property entrusted to him or that an action to
compel a trustee to convey property registered in his name in
trust for the benefit of the cestui que trust does not prescribe,
or that the defense of prescription cannot be set up in an
action to recover property held by a person in trust for the
benefit of another, or that property held in trust can be
recovered by the beneficiary regardless of the lapse of time.
The basis of the rule is that the possession of a trustee is not
adverse. Not being adverse, he does not acquire by
prescription the property held in trust.
Exception  The trustee may claim title by prescription
founded on adverse possession where:
1. He performed open and unequivocal acts of
repudiation amounting to the ouster of the cestui
que trust
2. Such positive acts were made known to the cestui
que trust
3. The evidence thereon should be clear and
conclusive or convincing.
4. The period fixed by law had prescribed.
Reckoning point of prescription  The period will commence
to run from and after said repudiation and the knowledge
thereof by the cestui que trust.
Period: The trustee acquires it after a period of 10 years (Art.
1134; Ordinary prescription) or 30 years (Art. 1137; Extra-
ordinary prescription) as the case may be. The beneficiary
may enforce his right of action to reconvey the property within
10 years from repudiation.
° Resulting Trust; General Rule  The trustee cannot
acquire by prescription ownership over property entrusted to
him.
°Exception  The trustee repudiates the trust and it was
made known to the beneficiary.
Reckoning point of prescription: The period will commence to
run from and after said repudiation and the knowledge thereof
by the cestui que trust.
Period: The trustee acquires it after a period of 10 years (Art.
1134; Ordinary prescription) or 30 years (Art. 1137; Extra-
ordinary prescription) as the case may be. The beneficiary
may enforce his right of action to reconvey the property within
10 years from repudiation.
 Easy Table - Trust | Katienza

conscience, to hold.
Examples: Articles 1450, 1454, 1455 & 1456 ° Constructive Trust; General Rule  Prescription
supervenes or applies even if the trustee does not repudiate
the relationship.

Period: The trustee acquires it after a period of 10 years (Art.

1134; Ordinary prescription) or 30 years (Art. 1137; Extra-
ordinary prescription) as the case may be.

If based on implied/constructive trust The beneficiary’s right

to action for reconveyance prescribes within 10 years to be
reckoned from the discovery of the fraud or notice thereof,
which is deemed to have taken place from the inscription of
the instrument or the issuance of the title to new owner.

If based exclusively on fraud  The beneficiary’s right to act

prescribes within 4 years to be reckoned from the discovery of
fraud. The fraud is deemed to have taken place upon the
issuance of the certificate of title over the property.