An equitable remedy that a court imposes against one who has obtained property by wrongdoing. • A constructive trust, imposed to prevent unjust enrichment, creates no fiduciary relationship. Despite its name, it is not a trust at all. Cf. resulting trust. — Also termed implied trust; involuntary trust; trust de son tort; trust ex delicto; […]
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implied trust. 1. See constructive trust under TRUST. 2. See resulting trust under TRUST.
aliquot-part rule. The principle that a person must intend to acquire a fractional part of the ownership of property before a court can declare a resulting trust in the person’s favor. [Cases: Trusts 62–90. C.J.S. Trover and Conversion §§ 10–11, 128–142, 144–173.]
basis. 1. A fundamental principle; an underlying condition. 2. Tax. The value assigned to a taxpayer’s investment in property and used primarily for computing gain or loss from a transfer of the property. • When the assigned value represents the cost of acquiring the property, it is also called cost basis. — Also termed tax
investment-direction agreement. A contract by which a trustee agrees not to diversify the trust’s assets, even though the trustee has the legal right to do so, and the beneficiary agrees to hold the trustee harmless for any losses resulting from not diversifying. — Abbr. IDA.
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discount, n. 1. A reduction from the full amount or value of something, esp. a price. 2. An advance deduction of interest when a person lends money on a note, bill of exchange, or other commercial paper, resulting in its present value. See PRESENT VALUE. 3. The amount by which a security’s market value is
fraudulent conveyance. 1. A transfer of property for little or no consideration, made for the purpose of hindering or delaying a creditor by putting the property beyond the creditor’s reach; a transaction by which the owner of real or personal property seeks to place the property beyond the reach of creditors. — Also termed fraud
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exculpatory clause. A contractual provision relieving a party from liability resulting from a negligent or wrongful act. • A will or a trust may contain an exculpatory clause purporting to immunize a fiduciary from a breach of duty; the clause may reduce the degree of care and prudence required of the fiduciary. But courts generally
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