The law recognizes several different types of trusts, but the two main categories are express trusts and implied trusts. Most trusts fall into one of these two categories, although some may contain elements of both.

What is an Express Trust?

An express trust is created when the settlor (the person who creates the trust) intentionally and explicitly states their intention to create a trust. The terms of the trust must be clearly laid out in a written document, and the settlor must have the capacity to create a trust. The trustee (the person who manages the trust) must have both the ability and the willingness to accept the trust property and carry out the terms of the trust.

What is an Implied Trust?

An implied trust is a trust that is created by operation of law, rather than by explicit statement. This type of trust typically arises in situations where one person holds property for the benefit of another, even though there is no formal trust agreement in place.

What Are Some Examples of Express Trusts?

There are many different types of express trusts, but some common examples include:

• Irrevocable life insurance trusts: These trusts are created to hold life insurance policies and pay out the death benefit to the named beneficiaries upon the policyholder’s death.
  

• Charitable remainder trusts: These trusts are created to benefit a charitable organization, with the remainder going to the named beneficiaries.
  

• Family trusts: These trusts are created to provide financial security for family members, typically after the death of the settlor.

What Are Some Examples of Implied Trusts?

As with express trusts, there are many different types of implied trusts. Some common examples include:

• Resulting trusts: These trusts arise when property is transferred to one person but it is clear that the intention was for another person to benefit from the property. For example, if a parent buys a house and puts their child’s name on the deed but intends to live there themselves, a resulting trust is created. The child holds the property in trust for the parent.
  

• Constructive trusts: These trusts are created by courts to prevent unjust enrichment. For example, if someone unlawfully takes possession of property that rightfully belongs to someone else, a constructive trust may be imposed to right the wrong.
  

• Quasi-contractual trusts: These trusts are similar to constructive trusts in that they are also created by courts to prevent unjust enrichment. However, they arise in situations where there is no formal contract in place. An example would be if someone provides services to another person with the expectation of being paid, but the person receiving the services refuses to pay. The court may order the payment to be made to the service provider in the form of a quasi-contractual trust.
  

Now that you know the difference between express and implied trusts, you can better understand how these types of trusts work and what role they play in estate planning.