A trust is a fiduciary1 relationship in which one party gives a second party the right to hold title to property or assets for the benefit of a third party. The trustee is a fiduciary obligated to handle the trust assets in accordance with the terms of the trust document and solely in the best interests of the beneficiaries.

At the elementary level, the idea of trust is a legal arrangement outlined in a formal document called Trust of Deeds, it is accepted by the following participating parties:

The Settlor: The Settlor is the person who creates the trust by placing a particular asset that s/he owns into the trust, i.e., by transferring that asset to another person along with clear instructions that the asset be held for the profit of a third party. The Settlor may be either a separate or a legal entity.

Trustee: The trustee is the person who possesses the assets for the interest of the Beneficiary. While in complete charge of the ‘trust assets,’ the trustee is obliged to manage the trust property in the best possible manner for the advantage of the Beneficiaries. The trustee is prevented from practicing the trust asset for his ends.

Beneficiary: The Beneficiary is a third party for whose benefit and earns of the trust asset are held and controlled by the trustee. The Beneficiary or beneficiaries may be either explicitly named in the ‘Trust Deed’ or maybe adequately defined group of persons.