Bangladesh Trusts Act 1882
Bangladesh Trusts Act 1882
Bangladesh Trusts Act 1882
1♣An
Act to define and amend the law relating to Private Trusts and Trustees.
Preamble
WHEREAS it is expedient to define and amend the law relating to private trusts and trustees; It
is hereby enacted as follows:-
CHAPTER I
PRELIMINARY
Short title 1. This Act may be called the Trusts Act, 1882: and it shall come into force
Commencemen
on the first day of March, 1882.
the owner: the person who reposes or declares the confidence is called
the “author of the trust”: the person who accepts the confidence is called
the “trustee”: the person for whose benefit the confidence is accepted is
called the “beneficiary”: the subject-matter of the trust is called “trust-
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and the instrument, if any, by which the trust is declared is called the
“instrument of trust”:
a breach of any duty imposed on a trustee, as such, by any law for the
Expressions And in this Act, unless there be something repugnant in the subject or
defined in
Act IX of context, “registered” means registered under the law for the registration of
1872 documents for the time being in force: a person is said to have “notice” of
a fact either when he actually knows that fact, or when, but for wilful
when information of the fact is given to or obtained by his agent, under the
circumstances mentioned in the Contract Act, 1872, section 229; and all
expressions used herein and defined in the Contract Act, 1872, shall be
deemed to have the meanings respectively attributed to them by that Act.
CHAPTER II
OF THE CREATION OF TRUSTS
Lawful 4. A trust may be created for any lawful purpose. The purpose of a trust is
purpose
lawful unless it is (a) forbidden by law, or (b) is of such a nature that, if
(d) involves or implies injury to the person or property of another, or (e) the
Every trust of which the purpose is unlawful is void. And where a trust is
created for two purposes, of which one is lawful and the other unlawful,
and the two purposes cannot be separated, the whole trust is void.
Explanation - In this section the expression “law” includes, where the trust-
country.
Illustrations
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smuggling business, and out of the profits thereof to support A's children.
during his life, and after his death for B. A is declared an insolvent. The
the trustee and registered, or by the will of the author of the trust or of the
trustee.
trustee.
Creation of 6. Subject to the provisions of section 5, a trust is created when the author
trust
of the trust indicates with reasonable certainty by any words or acts (a) an
intention on his part to create thereby a trust, (b) the purpose of the trust,
(c) the beneficiary, and (d) the trust-property, and (unless the trust is
Illustrations
he will dispose of it for the benefit of C”. This creates a trust so far as
regards A and C.
family”. This does not create a trust, as the beneficiary is not indicated with
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reasonable certainty.
such members of C's family as B should think most deserving. This does
not create a trust, for the beneficiaries are not indicated with reasonable
certainty.
among C's children. This does not create a trust, for the trust-property is
A's debts and a legacy to C. This is a condition, not a trust for A's creditors
and C.
or on behalf of a minor;
but subject in each case to the law for the time being in force as to the
circumstances and extent in and to which the author of the trust may
Disclaimer A proposed beneficiary may renounce his interest under the trust by
by
beneficiary disclaimer addressed to the trustee, or by setting up, with notice of the
Who may 10. Every person capable of holding property may be a trustee; but, where
be trustee
the trust involves the exercise of discretion, he cannot execute it unless he
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is competent to contract.
Acceptance A trust is accepted by any words or acts of the trustee indicating with
of trust
reasonable certainty such acceptance.
Disclaimer Instead of accepting a trust, the intended trustee may, within a reasonable
of trust
period, disclaim it, and such disclaimer shall prevent the trust-property
the other or others, and makes him or them sole trustee or trustees from
Illustrations
D. B and C prove A's will. This is in itself an acceptance of the trust, and B
(b) A transfers certain property to B in trust to sell it and to pay out of the
proceeds A's debts. B accepts the trust and sells the property. So far as
(c) A bequeaths a lakh of Taka to B upon certain trusts and appoints him
his executor. B severs the lakh from the general assets and appropriates it
CHAPTER III
OF THE DUTIES AND LIABILITIES OF TRUSTEES
Trustee to 11. The trustee is bound to fulfil the purpose of the trust, and to obey the
execute
trust directions of the author of the trust given at the time of its creation, except
as modified by the consent of all the beneficiaries being competent to
contract.
Where the beneficiary is incompetent to contract, his consent may, for the
jurisdiction.
trust for the payment of debts shall be deemed to be (a) to pay only the
debts of the author of the trust existing and recoverable at the date of the
instrument of trust, or, when such instrument is a will, at the date of his
death, and (b) in the case of debts not bearing interest, to make such
Illustrations
(b) A, a trustee of certain land for X, Y and Z, is authorised to sell the land
that A may sell the land to C for a less sum. A may sell the land
accordingly.
(c) A, a trustee for B and her children, is directed by the author of the trust
his bond. C becomes insolvent and B requests A to make the loan. A may
Trustee to 12. A trustee is bound to acquaint himself, as soon as possible, with the
inform
himself of nature and circumstances of the trust-property; to obtain, where
state of necessary, a transfer of the trust-property to himself; and (subject to the
trust-
provisions of the instrument of trust) to get in trust-moneys invested on
property
insufficient or hazardous security.
Illustrations
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debt so outstanding. The trustee's duty is to recover the debt without un-
necessary delay.
trustee must not allow the former to retain the money for a longer period
Trustee to 13. A trustee is bound to maintain and defend all such suits, and (subject
protect title
to trust- to the provisions of the instrument of trust) to take such other steps as,
property regard being had to the nature and amount or value of the trust-property,
Illustration
instrument to be registered.
Trustee not 14. The trustee must not for himself or another set up or aid any title to the
to set up
title trust-property adverse to the interest of the beneficiary.
adverse to
beneficiary
Care 15. A trustee is bound to deal with the trust-property as carefully as a man
required
from of ordinary prudence would deal with such property if it were his own; and,
trustee in the absence of a contract to the contrary, a trustee so dealing is not
Illustrations
the trustee as such, and payable at 5[Dhaka]. The bills are dis-honoured. A
(b) A, a trustee of leasehold property, directs the tenant to pay the rents on
account of the trust to a banker, B, then in credit. The rents are accordingly
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paid to B, and A leaves the money with B only till wanted. Before the
the loss.
(c) A, a trustee of two debts for B, releases one and compounds the other,
in good faith, and reasonably believing that it is for B's interest to do so. A
same, but does not advertise the sale and otherwise fails in reasonable
(e) A, a trustee for B, in execution of his trust, sells the trust-property, but
from want of due diligence on his part fails to receive part of the purchase-
money. A is bound to make good the loss thereby caused to B.
payment of the premiums. A neglects to pay the premiums, and the policy
in which A had himself invested them. A dies, and a change takes place in
the firm. B and C must not permit the moneys to remain upon the personal
(h) A, a trustee for B, allows the trust to be executed solely by this co-
Conversion 16. Where the trust is created for the benefit of several persons in
of
perishable succession, and the trust-property is of a wasting nature or a future or
property reversionary interest, the trustee is bound, unless an intention to the
character.
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Illustrations
(a) A bequeaths to B all his property in trust for C during his life, and on his
death for D, and on D's death for E. A's property consists of three
leasehold houses, and there is nothing in A's will to show that he intended
the houses to be enjoyed in specie. B should sell the houses, and invest
(b) A bequeaths to B his three leasehold houses in Chittagong and all the
furniture therein in trust for C during his life, and on his death for D, and on
D's death for E. Here an intention that the houses and furniture should be
Trustee to 17. Where there are more beneficiaries than one, the trustee is bound to
be impartial
be impartial, and must not execute the trust for the advantage of one at the
expense of another.
Where the trustee has a discretionary power, nothing in this section shall
Illustration
one of the these modes. The Court will not interfere, although the result of
Trustee to 18. Where the trust is created for the benefit of several persons in
prevent
waste succession and one of them is in possession of the trust-property, if he
Accounts 19. A trustee is bound (a) to keep clear and accurate accounts of the trust-
and
information property, and (b), at all reasonable times, at the request of the beneficiary,
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to furnish him with full and accurate information as to the amount and state
of the trust-property.
Investment 20. Where the trust-property consists of money and cannot be applied
of trust-
money immediately or at an early date to the purposes of the trust, the trustee is
Government]:
Provided that securities, both the principal whereof and the interest
(d) in debenture or other securities for money issued under the authority of
any Bangladesh Act, or on behalf of any municipal body or port trust or city
improvement trust: ]
Provided that the property is not a leasehold for a term of years and that
by any rule which the 12[Supreme Court] may from time to time prescribe in
this behalf:
in possession to receive the income of the trust-property for his life, or for
in clauses (d), (e), and (f) shall be made without his consent in writing.
Power to
purchase
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redeemable
13[20A.(1) A trustee may invest in any of the securities mentioned or
stock at a
premium referred to in section 20, notwithstanding that the same may be
date of purchase at par or at some other fixed rate, or purchase any such
(2) A trustee may retain until redemption any redeemable stock, fund or
security which may have been purchased in accordance with this section.]
Investment 14[20B. (1) Where the trust property comprises money and it cannot be
of trust-
money in applied immediately to the purposes of the trust, the trustee may, subject
company to any prohibition or restriction imposed in the instrument of trust, invest an
securities
amount not exceeding 25% of such money, hereinafter referred to in this
(2) In determining the exact amount of money that may be invested under
sub-section (1) at any given time, the money already invested, if any,
under this section and also under 20(f) shall be deducted from the
limit of investment.]
Deposit in 21. Nothing in section 20 shall apply to 15[* * *] in case the trust-money
Government
Savings does not exceed three thousand taka a deposit thereof in a Government
Bank Savings Bank.
Sale by 22. Where a trustee directed to sell within a specified time extends such
trustee
directed to time, the burden of proving, as between himself and the beneficiary, that
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sell within the latter is not prejudiced by the extension lies upon the trustee, unless
specified
time the extension has been authorised by a principal Civil Court of original
jurisdiction.
Illustration
within five years to sell it, and apply the proceeds for the benefit of C. In
the exercise of reasonable discretion, B postpones the sale for six years.
The sale is not thereby rendered invalid, but C, alleging that he has been
compensation. In such suit the burden of proving that C has not been
injured lies on B.
Liability for 23. Where the trustee commits a breach of trust, he is liable to make good
breach of
trust the loss which the trust-property or the beneficiary has thereby sustained,
unless the beneficiary has by fraud induced the trustee to commit the
knowledge of the facts of the case and of his right as against the trustee.
to the beneficiary:
(c) where the trustee ought to have received interest, but has not done so:
He is liable, in case (a), to account for the interest actually received, and,
in cases (b), (c) and (d), to account for simple interest at the rate of six per
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the same rate, or for the net profits made by such employment.
Illustrations
consequently lost: he is liable to make good the property lost, but he is not
B neglects to sell the house for a great length of time, whereby the house
is deteriorated and its market price falls. B is answerable to C for the loss.
(d) The duty of the trustee is to invest trust-money in any of the securities
mentioned in section 20, clause (a), (b), (c) or (d). Instead of so doing he
purchased with the trust-money when the investment should have been
(e) The instrument of trust directs the trustee to invest trust-money either
(f) The instrument of trust directs the trustee to invest trust-money in any of
charged either with the amount of the principal money and compound
with the trust-money when the investment should have been made,
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together with the amount of the accumulation which would have arisen
20, clause (a), (b), (c) or (d). The trustee sells such security for some
at the option of the beneficiary, either to replace the security with the
(h) The trust-property consists of land. The trustee sells the land to a
value to be settled upon the like trust, or to be charged with the proceeds
No set-off 24. A trustee who is liable for a loss occasioned by a breach of trust in
allowed to
trustee respect of one portion of the trust-property cannot set-off against his
Non-liability 25. Where a trustee succeeds another, he is not, as such, liable for the
for
predecessor’s acts or defaults of his predecessor.
default
Non-liability 26. Subject to the provisions of sections 13 and 15, one trustee is not, as
for co-
trustee’s such, liable for a breach of trust committed by his co-trustee:
default
Provided that, in the absence of an express declaration to the contrary in
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Joining in A co-trustee who joins in signing a receipt for trust-property and proves
receipt for
conformity that he has not received the same is not answerable, by reason of such
Illustration
invest the proceeds for the benefit of D. B and C accordingly sell the
hands. C pays no attention to the matter for two years, and then calls on B
Several 27. Where co-trustees jointly commit a breach of trust, or where one of
liability of
co-trustees them by his neglect enables the other to commit a breach of trust, each is
liable to the beneficiary for the whole of the loss occasioned by such
breach.
Contribution But as between the trustees themselves, if one be less guilty than another
as between
co-trustees and has had to refund the loss, the former may compel the latter, or his
good such loss; and, if all be equally guilty, any one or more of the trustees
who has had to refund the loss may compel the others to contribute.
Non-liability 28. When any beneficiary's interest becomes vested in another person,
of trustee
paying and the trustee, not having notice of the vesting, pays or delivers trust-
without property to the person who would have been entitled thereto in the
notice of
absence of such vesting, the trustee is not liable for the property so paid or
transfer by
beneficiary delivered.
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Indemnity 30. Subject to the provisions of the instrument of trust and of sections 23
of trustees
and 26, trustees shall be respectively chargeable only for such moneys,
stocks, funds and securities as they respectively actually receive and shall
not be answerable the one for the other of them, nor for any banker, broker
or other person in whose hands any trust-property may be placed, nor for
CHAPTER IV
OF THE RIGHTS AND POWERS OF TRUSTEES
Right to 31. A trustee is entitled to have in his possession the instrument of trust
title-deed
and all the documents of title (if any) relating solely to the trust-property.
Right to 32. Every trustee may reimburse himself, or pay or discharge out of the
reimbursement
of expenses trust-property, all expenses properly incurred in or about the execution of
If he pays such expenses out of his own pocket, he has a first charge upon
the trust-property for such expenses and interest thereon; but such charge
(unless the expenses have been incurred with the sanction of a principal
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expenses.
Right to 33. A person other than a trustee who has gained an advantage from a
indemnity
from gainer breach of trust must indemnify the trustee to the extent of the amount
by breach actually received by such person under the breach; and where he is a
of trust
beneficiary the trustee has a charge on his interest for such amount.
fraud.
Right to 34. Any trustee may, without instituting a suit, apply by petition to a
apply to
Court for principal Civil Court of original jurisdiction for its opinion, advice or
opinion in direction on any present questions respecting the management or
management
administration of the trust-property other than questions of detail, difficulty
of trust-
property or importance, not proper in the opinion of the Court for summary disposal.
A copy of such petition shall be served upon, and the hearing thereof may
The trustee stating in good faith the facts in such petition and acting upon
the opinion, advice or direction given by the Court shall be deemed, so far
The costs of every application under this section shall be in the discretion
Right to 35. When the duties of a trustee, as such, are completed, he is entitled to
settlement
of accounts have the accounts of his administration of the trust-property examined and
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settled; and, where nothing is due to the beneficiary under the trust, to an
General 36. In addition to the powers expressly conferred by this Act and by the
authority of
trustee instrument of trust, and subject to the restrictions, if any, contained in such
instrument, and to the provisions of section 17, a trustee may do all acts
which are reasonable and proper for the realisation, protection or benefit of
from the date of executing the lease, nor without reserving the best yearly
Power to 37. Where the trustee is empowered to sell any trust-property, he may sell
sell in lots,
and either the same subject to prior charges or not, and either together or in lots, by
by public public auction or private contract, and either at one time or at several
auction or
times, unless the instrument of trust otherwise directs.
private
contract
Power to 38. The trustee making any such sale may insert such reasonable
sell under
special stipulations either as to title or evidence of title, or otherwise, in any
conditions conditions of sale or contract for sale, as he thinks fit; and may also buy in
Power to
the property or any part thereof at any sale by auction, and rescind or vary
buy in and
re-sell any contract for sale, and re-sell the property so bought in, or as to which
speed and pay the proceeds to C. This does not render an immediate sale
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imperative.
such manner as he shall think fit and invest the proceeds for the benefit of
C. This does not authorise B, as between him and C, to postpone the sale
to an indefinite period.
Power to 39. For the purpose of completing any such sale, the trustee shall have
convey
power to convey or otherwise dispose of the property sold in such manner
as may be necessary.
Power to 40. A trustee may, at his discretion, call in any trust-property invested in
vary
investments any security and invest the same on any of the securities mentioned or
referred to in section 20, and from time to time vary any such investments
consent in writing.
Power to 41. Where any property is held by a trustee in trust for a minor, such
apply
property of trustee may, at his discretion, pay to the guardians (if any) of such minor,
minors, or otherwise apply for or towards his maintenance or education or
etc., for
advancement in life, or the reasonable expenses of his religious worship,
their
maintenance, marriage or funeral, the whole or any part of the income to which he may
etc.
be entitled in respect of such property; and such trustee shall accumulate
the same and the resulting income thereof from time to time in any of the
person who shall ultimately become entitled to the property from which
Provided that such trustee may, at any time, if he thinks fit, apply the whole
or any part of such accumulations as if the same were part of the income
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with the permission of a principal Civil Court of original jurisdiction, but not
otherwise, apply the whole or any part of such property for or towards such
Nothing in this section shall be deemed to affect the provisions of any local
law for the time being in force relating to the persons and property of
minors.
Power to 42. Any trustees or trustee may give a receipt in writing for any money,
give
receipts securities or other moveable property payable, transferable or deliverable
the absence of fraud, such receipt shall discharge the person paying,
thereof.
Power to 43. Two or more trustee acting together may, if and as they think fit,-
compound,
etc. (a) accept any composition or any security for any debt or for any property
claimed;
settle any debt, account, claim or thing whatever relating to the trust; and,
(d) for any of those purposes, enter into, give, execute and do such
other things as to them seem expedient, without being responsible for any
powers thereof.
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expressed in the instrument of trust, if any, and shall have effect subject to
This section applies only to trusts created after this Act comes into force.
Power to 44. When an authority to deal with the trust-property is given to several
several
trustees of trustees and one of them disclaims or dies, the authority may be exercised
whom one by the continuing trustees, unless from the terms of the instrument of trust
disclaims
it is apparent that the authority is to be exercised by a number in excess of
or dies
the number of the remaining trustees.
Suspension 45. Where a decree has been made in a suit for the execution of a trust,
of trustee’s
powers by the trustee must not exercise any of his powers except in conformity with
decree such decree, or with the sanction of the Court by which the decree has
been made, or, where an appeal against the decree is pending, of the
Appellate Court.
CHAPTER V
OF THE DISABILITIES OF TRUSTEES
Trustee 46. A trustee who has accepted the trust cannot afterwards renounce it
cannot
renounce except (a) with the permission of a principal Civil Court of original
after jurisdiction, or (b) if the beneficiary is competent to contract, with his
acceptance
consent, or (c) by virtue of a special power in the instrument of trust.
Trustee 47. A trustee cannot delegate his office or any of his duties either to a co-
cannot
delegate trustee or to a stranger, unless (a) the instrument of trust so provides, or
(b) the delegation is in the regular course of business, or (c) the delegation
is necessary, or (d) the beneficiary, being competent to contract, consents
to the delegation.
Illustrations
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will.
(b) A is a trustee of certain property with power to sell the same. A may
(c) A bequeaths to B fifty houses let at monthly rents in trust to collect the
rents and pay them to C. B may employ a proper person to collect these
rents.
Co-trustees 48. When there are more trustees than one, all must join in the execution
cannot act
singly of the trust, except where the instrument of trust otherwise provides.
Trustee 50. In the absence of express directions to the contrary contained in the
may not
charge for instrument of trust or of a contract to the contrary entered into with the
services beneficiary or the Court at the time of accepting the trust, a trustee has no
right to remuneration for his trouble, skill and loss of time in executing the
trust.
Trustee 51. No trustee may not use or deal with the trust-property for his own profit
may not
use trust- or for any other purpose unconnected with the trust.
property for
his own
profit
Trustee for 52. No trustee whose duty it is to sell trust-property, and no agent
sale or his
agent may employed by such trustee for the purpose of the sale, may, directly or
not buy
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indirectly, buy the same or any interest therein, on his own account or as
Trustee 53. No trustee, and no person who has recently ceased to be a trustee,
may not
buy may, without the permission of a principal Civil Court of original jurisdiction,
beneficiary’s buy or become mortgagee or lessee of the trust-property or any part
interest
thereof; and such permission shall not be given unless the proposed
without
permission purchase, mortgage or lease is manifestly for the advantage of the
beneficiary.
Trustee for And no trustee whose duty it is to buy or to obtain a mortgage or lease or
purchase
particular property for the beneficiary may buy it, or any part thereof, or
obtain a mortgage or lease of it, or any part thereof, for himself.
CHAPTER VI
OF THE RIGHTS AND LIABILITIES OF THE BENEFICIARY
Rights to 55. The beneficiary has, subject to the provisions of the instrument of trust,
rents and
profits a right to the rents and profits of the trust-property.
Right to
56. The beneficiary is entitled to have the intention of the author of the
specific
execution trust specifically executed to the extent of the beneficiary's interest;
Right to and, where there is only one beneficiary and he is competent to contract,
transfer of
possession or where there are several beneficiaries and they are competent to
contract and all of one mind, he or they may require the trustee to transfer
married woman, so that she shall not have power to deprive herself of her
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Illustrations
it immediately to him.
(c) A transfers certain property to B and directs him to sell or invest it for
the benefit of C, who is competent to contract. C may elect to take the
Right to 57. The beneficiary has a right, as against the trustee and all persons
inspect and
take copies claiming under him with notice of the trust, to inspect and take copies of
of the instrument of trust, the documents of title relating solely to the trust-
instrument
property, the accounts of the trust-property and the vouchers (if any) by
of trust
accounts, which they are supported, and the cases submitted and opinions taken by
etc.
the trustee for his guidance in the discharge of his duty.
Right to 58. The beneficiary, if competent to contract, may transfer his interest, but
transfer
beneficial subject to the law for the time being in force as to the circumstances and
interest extent in and to which he may dispose of such interest:
her beneficial interest, nothing in this section shall authorise her to transfer
such interest during her marriage.
Right to sue 59. Where no trustees are appointed or all the trustees die, disclaim, or
for
execution are discharged, or where for any other reason the execution of a trust by
of trust the trustee is or becomes impracticable, the beneficiary may institute a suit
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for the execution of the trust, and the trust shall, so far as may be possible,
be executed by the Court until the appointment of a trustee or new trustee.
Right to 60. The beneficiary has a right (subject to the provisions of the instrument
proper
trustees of trust) that the trust-property shall be properly protected and held and
Explanation I - The following are not proper persons within the meaning of
this section:-
Illustrations
property.
(b) A bequeaths certain jewels to B in trust for C. B dies during A's life
time; then A dies. C is entitled to have the property conveyed to a trustee
for him.
(c) A conveys certain property to four trustees in trust for B. Three of the
trustee die. B may institute a suit to have three new trustees appointed in
(d) A conveys certain property to three trustees in trust for B. All the
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Right to 61. The beneficiary has a right that his trustee shall be compelled to
compel to
any act of perform any particular act of his duty as such, and restrained from
duty committing any contemplated or probable breach of trust.
Illustrations
(a) A contracts with B to pay him monthly Tk. 100 for the benefit of C. B
writes and signs a letter declaring that he will hold in trust for C the money
so to be paid. A fails to pay the money in accordance with his contract. C
(b) A is trustee of certain land, with a power to sell the same and pay the
proceeds to B and C equally. A is about to make an improvident sale of the
land. B may sue on behalf of himself and C for an injunction to restrain A
Wrongful 62. Where a trustee has wrongfully bought trust-property, the beneficiary
purchase
by trustee has a right to have the property declared subject to the trust or
paid by the trustee, with interest, and such other expenses (if any) as he
has properly incurred in the preservation of the property; and the trustee or
purchaser must (a) account for the net profits of the property, (b) be
charged with an occupation-rent, if he has been in actual possession of
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(a) impairs the rights of lessees and others who, before the institution of a
suit to have the property declared subject to the trust or retransferred,
(b) entitles the beneficiary to have the property declared subject to the
trust or retransferred where he, being competent to contract, has himself,
Following 63. Where trust-property comes into the hands of a third person
trust-
property- inconsistently with the trust, the beneficiary may require him to admit
into the formally, or may institute a suit for a declaration, that the property is
hands of
comprised in the trust.
third
persons;
Where the trustee has disposed of trust-property and the money or other
into that
into which property which he has received therefor can be traced in his hands, or the
it has been hands of his legal representative or legatee, the beneficiary has, in respect
converted
thereof, rights as merely as may be the same as his rights in respect of the
original trust-property.
Illustrations
(a) A, a trustee for B of Tk. 10,000, wrongfully invests Tk. 10,000 in the
(b) A, a trustee, wrongfully purchases land in his own name, partly with his
own money, partly with money subject to a trust for B. B is entitled to a
Saving of 64. Nothing in section 63 entitles the beneficiary to any right in respect of
rights of
certain property in the hands of-
transferees
(a) a transferee in good faith for consideration without having notice of the
trust, either when the purchase-money was paid, or when the conveyance
was executed, or
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Right in 66. Where the trustee wrongfully mingles the trust-property with his own,
case of
blended the beneficiary is entitled to a charge on the whole fund for the amount
property due to him.
Illustrations
(a) A and B are partners. A dies, having bequeathed all his property B in
trust for Z, and appointed B his sole executor. B instead of winding up the
affairs of the partnership, retains all the assets in the business. Z may
compel him, as partner, to account for so much of the profits as are
derived from A's share of the capital. B is also answerable to Z for the
improper employment of A's assets.
sole executor, and dies. B enters into partnership with X and Y in the same
trade, and employs A's assets in the partnership-business. B gives an
other beneficiaries, or
time take proper steps to protect the interests of the other beneficiaries, or
(d) has deceived the trustee and thereby induced him to commit a breach
of trust,
the other beneficiaries are entitled to have all his beneficial interest
impounded as against him and all who claim under him (otherwise than as
transferees for consideration without notice of the breach) until the loss
caused by the breach has been compensated.
married woman, so that she shall not have power to deprive herself of her
beneficial interest, nothing in this section applies to such property during
her marriage.
Rights and 69. Every person to whom a beneficiary transfers his interest has the
liabilities of
beneficiary’s rights, and is subject to the liabilities, of the beneficiary in respect of such
transferee interest at the date of the transfer.
CHAPTER VII
OF VACATING THE OFFICE OF TRUSTEE
Office how 70. The office of a trustee is vacated by his death or by his discharge from
vacated
his office.
Discharge 71. The trustee may be discharged from his office only as follows:-
of trustees
(a) by the extinction of the trust;
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(e) by consent of himself and the beneficiary, or, where there are more
beneficiaries than one, all the beneficiaries than one, all the beneficiaries
(f) by the Court to which a petition for his discharge is presented under this
Act.
Petition to 72. Notwithstanding the provisions of section 11, every trustee may apply
be
discharged by petition to a principal Civil Court of original jurisdiction to be discharged
from trust from his office; and, if the Court finds that there is sufficient reason for
such discharge, it may discharge him accordingly, and direct his costs to
be paid out of the trust-property. But, where there is no such reason, the
Court shall not discharge him, unless a proper person can be found to take
his place.
Appointment 73. Whenever any person appointed a trustee disclaims, or any trustee,
of new
trustees on either original or substituted dies, or is for a continues period of six months
death, etc. absent from Bangladesh, or leaves Bangladesh for the purpose of residing
by-
(a) the person nominated for that purpose by the instrument of trust (if
any), or.
(b) if there be no such person, or no such person able and willing to act,
the author of the trust if he be alive and competent to contract, or the
surviving or continuing trustees or trustee for time being, or legal
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consent of the Court) the retiring trustees, if they all retire simultaneously,
Every such appointment shall be by writing under the hand of the person
making it.
increased.
The Official Trustee may, with his consent and by the order of the Court,
be appointed under this section, in any case in which only one trustee is to
The provisions of this section relative to a trustee who is dead include the
case of a person nominated trustee in a will but dying before the testator,
and those relative to a continuing trustee include a refusing or retiring
Appointment 74. Whenever any such vacancy or disqualification occurs and it is found
by Court
impracticable to appoint a new trustee under section 73, the beneficiary
may, without instituting a suit, apply by petition to a principal Civil Court of
Rules for In appointing new trustees, the Court shall have regard (a) to the wishes of
selecting
new the author of the trust as expressed in or to be inferred from the instrument
trustees of trust; (b) to the wishes of the person, if any, empowered to appoint new
trustees; (c) to the question whether the appointment will promote or
impede the execution of the trust; and (d) where there are more
beneficiaries than one, to the interests of all such beneficiaries.
Vesting of
75. Whenever any new trustee is appointed under section 73 or section
trust-
property in 74, all the trust-property for the time being vested in the surviving or
new continuing trustees or trustee, or in the legal representative of any trustee,
trustees
shall become vested in such new trustee, either solely or jointly with the
surviving or continuing trustees or trustee, as the case may require.
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Powers of Every new trustee so appointed, and every trustee appointed by a Court,
new
trustees either before or after the passing of this Act, shall have the same powers,
authorities and discretions, and shall in all respects act, as if he had been
originally nominated a trustee by the author of the trust.
Survival of 76. On the death or discharge of one of several co-trustees, the trust
trust
survives and the trust-property passes to the others, unless the instrument
CHAPTER VIII
78. A trust created by will may be revoked at the pleasure of the testator.
(a) where all the beneficiaries are competent to contract - by their consent;
(c) where the trust is for the payment of the debts of the author of the trust,
and hgas not been communicated to the creditors - at the pleasure of the
author of the trust.
Illustration
A conveys property to B in trust to sell the same and pay out of the
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But if the creditors are parties to the arrangement, the trust cannot be
CHAPTER VIII
OF THE EXTINCTION OF TRUSTS
Revocation 78. A trust created by will may be revoked at the pleasure of the testator.
of trust
A trust otherwise created can be revoked only-
(a) where all the beneficiaries are competent to contract - by their consent;
(c) where the trust is for the payment of the debts of the author of the trust,
and hgas not been communicated to the creditors - at the pleasure of the
author of the trust.
Illustration
A conveys property to B in trust to sell the same and pay out of the
proceeds the claims of A's creditors. A reserves no power of revocation. If
no communication has been made to the creditors, A may revoke the trust.
But if the creditors are parties to the arrangement, the trust cannot be
Revocation
not to
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defeat what
trustees 79. No trust can be revoked by the author of the trust so as to defeat or
have duly prejudice what the trustees may have duly done in execution of the trust.
done
CHAPTER IX
OF CERTAIN OBLIGATIONS IN THE NATURE OF TRUSTS
Where 80. An obligation in the nature of a trust is created in the following cases.
obligation
in nature of
trust is
created
Where it 81. Where the owner of property transfers or bequeaths it and it cannot be
does not
appear that inferred consistently with the attendant circumstances that he intended to
transferor dispose of the beneficial interest therein, the transferee or legatee must
intended to
hold such property for the benefit of the owner or his legal representative.
dispose of
beneficial
Illustration
interest
(a) A conveys land to B without consideration and declares no trust of any
part. It cannot, consistently with the circumstances under which the
transfer is made, be inferred that A intended to transfer the beneficial
(b) A conveys to B two fields, Y and Z, and declares a trust of Y, but says
(c) A transfers certain stock belonging to him into the joint names of
himself and B. It cannot, consistently with the circumstances under which
(d) A makes a gift of certain land to his wife B. She takes the beneficial
interest in the land free from any trust in favour of A, for it may be inferred
from the circumstances that the gift was for B's benefit.
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Transfer to 82. Where property is transferred to one person for a consideration paid or
one for
consideration provided by another person, and it appears that such other person did not
paid by intend to pay or provide such consideration for the benefit of the
another
transferee, the transferee must hold the property for the benefit of the
16[* * *]
Trust 83. Where a trust is incapable of being executed, or where the trust is
incapable
of completely executed without exhausting the trust-property, the trustee, in
execution the absence of a direction to the contrary, must hold the trust-property, or
or executed
so much thereof as is unexhausted, for the benefit of the author of the trust
without
exhausting or his legal representative.
trust-
property Illustrations
“in trusts for C,” and C renounces his interest under the trust.
(b) A transfers Tk. 10,000 in the four per cents. to B, in trust to pay the
interest annually accruing due to C for her life. A dies. Then C dies, B
(c) A conveys land to B upon trust to sell it and apply one moiety of the
proceeds for certain charitable purposes, and the other for the
maintenance of the worship of an idol. B sells the land, but the charitable
purposes wholly fail, and the maintenance of the worship does not exhaust
the second moiety of the proceeds. B holds the first moiety and the part
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representative.
holds for the benefit of A's legal representative the undisposed of interest
in the money or land if purchased.
Transfer for 84. Where the owner of property transfers it to another for an illegal
illegal
purpose purpose and such purpose is not carried into execution, or the transferor is
transferee must hold the property for the benefit of the transferor.
Bequest for 85. Where a testator bequeaths certain property upon trust and the
illegal
purpose purpose of the trust appears on the face of the will to be unlawful, or
during the testator's lifetime the legatee agrees with him to apply the
property for an unlawful purpose, the legatee must hold the property for
the benefit of the testator's legal representative.
paid.
Debtor 87. Where a debtor becomes the executor or other legal representative of
becoming
creditor’s his creditor, he must hold the debt for the benefit of the persons interested
representative therein.
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Advantage 88. Where a trustee, executor, partner, agent, director of a company, legal
gained by
fiduciary adviser, or other person bound in a fiduciary character to protect the
into any dealings under circumstances in which his own interests are, or
may be, adverse to those of such other person and thereby gains for
himself a pecuniary advantage, he must hold for the benefit of such other
person the advantage so gained.
Illustrations
under the will. B is ignorant of the value of the bequest. A must hold for the
benefit of B the difference between the price and value.
(b) A, a trustee, uses the trust-property for the purpose of his own
business. A holds for the benefit of his beneficiary the profits arising from
such user.
beneficiary.
(d) A, a partner, buys land in his own name with funds belonging to the
partnership. A holds such land for the benefit of the partnership.
negotiating the terms of a lease clandestinely stipulates with the lessor for
payment to himself a lakh of Taka. A holds the lakh for the benefit of the
partnership.
(f) A and B are partners. A dies. B, instead of winding up the affairs of the
partnership, retains all the assets in the business. B must account to A's
legal representative for the profits from A's share of the capital.
(g) A, an agent employed to obtain a lease for B, obtains the lease for
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(h) A, a guardian, buys up for himself incumbrances on his ward B's estate
Advantage 89. Where, by the exercise of undue influence, any advantage is gained in
gained by
exercise of derogation of the interests of another, the person gaining such advantage
undue without consideration, or with notice that such influence has been
influence
exercised, must hold the advantage for the benefit of the person whose
Advantage 90. Where a tenant for life, co-owner, mortgagee or other qualified owner
gained by
qualified of any property, by availing himself of his position as such, gains an
owner advantage in derogation of the rights of the other persons interested in the
Illustrations
(a) A, the tenant for life of leasehold property, renews the lease in this own
name and for his own benefit. A holds the renewed lease for the benefit of
the inamdar of the village. A holds the village for the benefit of himself and
the other members.
Government revenue to fall into arrear with a view to the land being put up
for sale and his becoming himself the purchaser of it. The land is
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Property 91. Where a person acquires property with notice that another person has
acquired
with notice entered into an existing contract affecting that property, of which specific
of existing performance could be enforced, the former must hold the property for the
contract
benefit of the latter to the extent necessary to give effect to the contract.
Purchase 92. Where a person contracts to buy property to be held on trust for certain
by person
contracting beneficiaries and buys the property accordingly, he must hold the property
to buy for their benefit to the extent necessary to give effect to the contract.
property to
be held on
trust
Advantage 93. Where creditors compound the debts due to them, and one of such
secretly
gained by creditors, by a secret arrangement with the debtor, gains an undue
one of advantage over his co-creditors, he must hold for the benefit of such
several
creditors the advantage so gained.
compounding
creditors
Constructive 94. In any case not coming within the scope of any of the preceding
trusts in
cases not sections, where there is no trust, but the person having possession of
expressly property has not the whole beneficial interest therein, he must hold the
provided
property for the benefit of the persons having such interest, or the residue
for
thereof (as the case may be), to the extent necessary to satisfy their just
demands.
Illustrations
without having paid the whole of B's debts. The legatees hold for the
benefit of B's creditors, to the extent necessary to satisfy their just
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assent, power to revoke at pleasure the gift as to Tk. 10,000. The gift is
void as to Tk. 10,000, and B holds that sum for the benefit of A.
Obligor’s 95. The person holding property in accordance with any of the preceding
duties,
liabilities sections of this Chapter must, so far as may be, perform the same duties,
and and is subject, so far as may be, to the same liabilities and disabilities, as
disabilities
if he were a trustee of the property for the person for whose benefit he
hold it:
skill and loss of time in such cultivation or employment; and (b) where he
holds the property by virtue of a contract with a person for whose benefit
he holds it, or with any one through whom such person claims, he may,
without the permission of the Court, buy or become lessee or mortgagee
Saving of 96. Nothing contained in this Chapter shall impair the rights of transferees
rights of
bona fide in good faith for consideration, or create an obligation in evasion of any
purchasers law for the time being in force.
1 Throughout this Act, except otherwise provided, the words “Bangladesh”, “Government” and “Taka” or “Tk.” were
substituted, for the words “Pakistan”, “Central Government” or “Provincial Government” and “rupees” or “Rs.” respectively
by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
2 The word “Muslim” was substituted, for the word “Muhammadan” by section 3 and 2nd Schedule of the Bangladesh
Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
3 The words, comma and figure “Registration Act, 1908” were substituted, for the words, comma and figure “Indian
Registration Act, 1877” by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act
No. VIII of 1973)
4 The word “Dhaka” was substituted, for the word “Karachi” by section 3 and 2nd Schedule of the Bangladesh Laws
5 The word “Dhaka” was substituted, for the word “Karachi” by section 3 and 2nd Schedule of the Bangladesh Laws
6 The words “of the Government” were substituted, for the words and comma “of any Provincial Government or of the
Central Government, or of the United Kingdom of Great Britain and Ireland” by section 3 and 2nd Schedule of the
Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
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7 The word “the” was substituted, for the words “any such” and "such" respectively by section 3 and 2nd Schedule of the
Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
8 The word “the” was substituted, for the words “any such” and "such" respectively by section 3 and 2nd Schedule of the
Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
9 Clauses (b) and (bb) were omitted by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration)
10 Clauses (c) and (d) were substituted, for clauses (c) and (d) by section 3 and 2nd Schedule of the Bangladesh Laws
11 The word "Bangladesh" was substituted, for the word "a Province" by section 3 and 2nd Schedule the Bangladesh Laws
12 The words “Supreme Court” were substituted, for the words “High Court” by section 3 and 2nd Schedule of the
Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973)
13 Section 20A was inserted by section 3 of the Indian Trusts (Amendment) Act, 1916 (Act No. I of 1916)
14 Section 20B was inserted by section 2 of the Trusts (Amendment) Act, 2000 (Act No. XXI of 2000)
15 The words, commas and figure “investments made before this Act comes into force, or shall be deemed to precluded an
investment on a mortgage of immovable property already pledged as security for an advance under the Land Improvement
Act, 1871 or” were omitted by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973
(Act No. VIII of 1973)
16 The second paragraph of section 82 was omitted by section 3 and 2nd Schedule of the Bangladesh Laws (Revision
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