What is a Trust?

A trust, in the context of Nebraska law, is a fiduciary relationship with respect to property. This relationship obligates the person holding the title to the property, known as the trustee, to manage the property for the benefit of another person, referred to as the beneficiary. The trust is created by an individual, known as the grantor, who transfers property to the trustee with the intention that it be held, managed, or administered by the trustee for the benefit of the grantor or certain designated beneficiaries.

Trusts can take various forms. For instance, a revocable trust can be modified or terminated by the grantor or a representative who can petition the court to terminate the trust. An irrevocable trust, on the other hand, cannot be revoked by the grantor. There are also special needs trusts, testamentary trusts, and pooled trusts, each with their unique characteristics and purposes. In addition to express trusts, which are explicitly created by the grantor, there are also implied trusts, such as resulting trusts and constructive trusts. A resulting trust arises when a transfer of property is made to one person, but the purchase price or consideration was paid by another person. A constructive trust is imposed when one has acquired legal title to property under such circumstances that he or she may not in good conscience retain the beneficial interest in the property.

In Nebraska, the terms of a trust are the manifestation of the settlor's intent regarding a trust's provisions as expressed in the trust instrument or as may be established by other evidence that would be admissible in a judicial proceeding. The trustee holds a fiduciary responsibility to manage the trust’s corpus and income for the benefit of the beneficiaries. The trust must be valid under state law and manifested by a valid trust instrument of agreement.