Cestui que
Cestui que is a legal term used to denote beneficiary status in a trust.
Specifically, the term cestui que refers to any person or persons for whose benefit the trust is explicitly created. Unless restricted by the trust instrument, any such party is fully entitled to the equitable interests as outlined such as annual rents/produce/interest of the property forming the trust assets in question.
The term itself is derived from a longer Law French phrase of medieval English invention: "cestui a que use le feoffment fuit fait",. The shortened version appears in a number of legal phrases, including cestui que trust, cestui que use, or cestui que vie. Cestui que use and cestui que trust are often used interchangeably. In some medieval documents this is also sometimes written as cestui a que. In the discourse of jurisprudence as well as legal history, cestui que has frequently been used in reference to the relative novelty of the trust as a legal concept.
Uses and subcategories
Subsets of cestui que, B and C, are identified in the following example:Land is granted to or held by A, for the use of B in trust for the duration of his or her life. When B dies, the remainder goes to C.
In this case, A is the trustee, B is cestui que use, and C is the cestui que trust. If B and C are the same person, which is often the case, the two legal French terms become synonymous. While common, the duration of ‘for life’ is not essential; it can also last for a term of years, a shorter period, or for the life of another person.
While still used by some members of the judiciary and legal writers, cestui que and its derived terms have fallen out of everyday use in most modern legal parlance. In general trust law, it has largely been supplanted by the term beneficiary.
Original purposes
Both of the aforementioned categories of cestui que are rooted in the feudal law dominant in most of European Christendom during the middle ages. As a concept, it originated as a means to avoid feudal levies due to an overlord by passing land on for the use of another person, namely one free of such obligations. The law of tended to defer jurisdiction to courts of equity as opposed to the less flexible common law courts. The device was often used by people who might be absent from the kingdom for an extended time, who held a tenancy in the land and in return owed feudal incidents to the landlord. This would allow the land to be left for the use of a third party.Any such "in trust" legal status was partly to circumvent the Statute of Mortmain, which sought to end the relatively common practice of leaving real property to the Church following the tenant's death, so as to avoid dues which could, if left unpaid, lead to reversion/repossession of the tenancy to the landlord. Two concepts explain the origin of mortmain. First, it can be interpreted in reference to the desire of the deceased donor and former owner to pass on properties to the Church. Second, because the Church is not a person but an institution that could never die or be declared dead in the legal sense, the land never leaves its "dead hand". Before Edward I issued the statues between 1278 and 1290, vast tracts of land were left directly to the Church, which never relinquished it. Other land could be transferred to anyone, inherited only through a family line, or revert to an over-lord or the Crown upon the death of the tenant. The Church's accumulation of land had been a source of contention between the Crown and the Church for centuries. Creating a trust in such a way allowed the Church to continue reaping material benefit from the lands in question, because the legal title of ownership would be transferred to a corporation of lawyers or other entities legally separate from but acting on behalf of the Church to maintain the pre-Statute status quo.
History in German and Roman law
It is the opinion of William Holdsworth quoting such scholars as Gilbert, Sanders, Blackstone, Spence and Digby, that cestui que in English law had a Roman origin. An analogy exists between cestui que uses and a usufructus or the bequest of a fideicommissum. These all tended to create a feoffment to one person for the use of another. Gilbert writes "that they answer more to the fideicommissum than the usufructus of the civil law". These were transplanted into England from Roman civil law about the close of the reign of Edward III of England by means of foreign ecclesiastics who introduced them to evade the Statutes of Mortmain. Others argue that the comparison between cestui que and Roman law is merely superficial. The transfer of land for the use of one person for certain purposes to be carried out either in the lifetime or after the death of the person conveying it has its basis in Germanic law. It was popularly held that land could be transferred for the use from one person to another in local custom. The formal English or Saxon law did not always recognize this custom. The practice was called Salman or Treuhand. Sala is Old High German for "transfer". It is related to the Old English sellen, "to sell".The earliest appearance of cestui que in the medieval period was the feoffee to uses, which, like the Salman, was held on account of another. This was called the cestui que use. It was because the feoffor could impose on him many various duties that landowners acquired through his instrumentality the power to do many things with their land. This was used to avoid the rigidity of medieval common law of land and its uses. Germanic law was familiar with the idea that a man who holds property on account of, or to the use of another is bound to fulfill his trust. Frankish formulas from the Merovingian period describe property given to a church ad opus sancti illius. Mercian books in the ninth century convey land ad opus monachorum. The Domesday Book of 1086 refers to geld or money, sac and soc held in ad opus regis, or in reginae or vicecomitis. The laws of William I of England speak of the sheriff holding money al os le rei.
Others state that the cestui que use trust was the product of Roman law. In England it was the invention of ecclesiastics who wanted to escape the Statute of Mortmain. The goal was to obtain a conveyance of an estate to a friendly person or corporation, with the intent that the use of the estate would reside with the original owner.
Pollock and Maitland describe cestui que use as the first step toward the law of agency. They note that the word "use" as it was employed in medieval English law was not from the Latin, but rather from the Latin word, meaning "work". From this came the Old French words os or oes. Although with time the Latin document for conveying land to the use of John would be written ad opus Johannis which was interchangeable with ad usum Johannis, or the fuller formula, ad opus et ad usum, the earliest history suggests the term "use" evolved from ad opus.
Medieval invention
Many reasons have been given for the invention of the cestui que use as a legal device. During the Crusades, and other wars on the continent, landowners might be gone for long periods of time. Others might be absent because of business adventures or religious pilgrimages. There was no assurance they would ever return home. The cestui que use allowed them to leave a trusted friend or relative with the sort of powers, discretions and they hoped, the duties. Today, this power would be called the "power of attorney". Religious orders such as Franciscans, Cistercians, Benedictines and other mendicant orders took vows of poverty, yet retained the use of donated property. Cestui que use allowed them the benefits of land without legal ownership.Besides the obvious limitations placed on cestui que by the Statute of Mortmain, the Statute of Uses and the Statute of Wills, its legality was shaped indirectly by provisions within Magna Carta and Quia Emptores.
Typical medieval patterns
Derek Roebuck has given the following typical fact patterns which were often found in medieval cestui que use:Example 1: Albert is the owner of a landholding called Blackacre. He conveys this to Richard with the command that Richard hold the land with the duty not for Richard's benefit, but for a different purpose. This could be to do a job, such as collect rents and profits for the purpose of passing them to a third person, Lucy. This was nothing more than a clever legal device with Richard playing either an active or passive role.
Example 2: If Jane granted Blackacre to Charles to the use of David, then David became the beneficial owner and Jane could not vary or detract from that ownership.
Example 3: If Mary wanted to grant Blackacre away from her direct heir James to her younger son Jasper, then she might well do so by a grant of Richard to the use of Jasper in tail, remainder to James in fee simple. Only Richard had a legal estate, the interests of Jasper and James being equitable analogues of a legal fee tail and fee simple in remainder.
Example 4: If Mary wanted to make a will of the equitable ownership of Blackacre, she would be able to do so by a grant to Richard to the use of herself, Mary. The ownership of Blackacre did not pass on Mary's death to her heir but went to wherever she might will it. By this method, Mary could keep her wishes secret until her death when her will would be read, and would prevail. This was a way to defeat primogeniture inheritance.
Example 5: Uses were so common by the middle of the fifteenth century that they were presumed to be in existence even if no intention could be proved. If Martin granted Blackacre to Martha, and she could show no consideration, then Martha would be considered in equity to be the feoffee to unspecified uses to be announced at Martin's discretion. If Martin sold Blackacre to Martha, but did not go through the formal routines of feoffment to complete the conveyance, Martha could not become the legal owner. But in equity, Martin held the land to the cestui que use of Martha. It would have been unconscionable for him to do otherwise having taken her money for the sale of Blackacre.
Example 6: Albert might convey Blackacre to Richard for the use of Jane. In this case, Richard was called the "feoffee or trustee ". This device separated legal from beneficial ownership.