Equity and Trust – Trust in Favour of Creditors
This is a unique feature which the law of trust can be put into. Its objective is to secure the interest of the party in whose favour the trust is being declared and in the case of creditors, to secure their money.
Forms of trust in favour of creditors
There are various patterns which these can take and they include:
- Transfer of property or money to a named supervisor in pursuance of a company’s voluntary arrangements
- Agreement by a company to transfer identified assets to a named supervisor
- Where monies were received on the understanding to be kept in a separate account and for the depositor’s purpose