protest against my attempt to fasten the octopus of monopolies onto the Latin American Republics! Once a name was adopted, the next question was to define the new institution in such a way that the definition met these three requirements: First, that it was easily understood by people who were not familiar with either the trust or the Common Law; second, that it came within the structure, the terminology and the peculiarities of the civil law; and third, that it was broad enough to embrace in its scope virtually the same field covered by the trust. Now, in order to arrive at such a definition, it was indispensable to interpret as closely as possible and express in accordance with the character of the civil law, first, the nature of the property conveyed in trust; and, second, the nature and character of the institution. THE CIVIL LAW PERCEPTION OF TRUSTS The first thing by which the Latin mind is struck in studying the institution of the trust is that it involves a double conception of ownership, the trustee being the "legal owner," according to the Common Law, while the beneficiary holds what is called "the equitable title. In other words, in the same patrimony there is recognized a theoretical or conventional title in the trustee and a real and substantive right in the beneficiary or cestui que trust. This division of the right of ownership is naturally linked with the distinction between Common Law and Equity typical of the Anglo-Saxon juridical system. All of these concepts are extraneous to the juridical Latin mind. We do not have a common law, but a code or exclusively statutory system. Administration of Equity as something distinct and separate from the administration of Justice, is unknown in our juridical organization. Justice, as the old Romans said, is "the constant and perpetual will to give every one his due." (Constans et perpetua voluntas suum cuique tribuere.) Therefore, we conceive justice as "It is interesting to note that while the modern conception of Equity as a juridical system is altogether Anglo-Saxon, yet its original conception is seen as a development of the Roman law. An American jurist and scholar of great learning, Charles Kerr, gives this lucid view of the Roman conception of Equity within the unity of justice: The Jus Civile and the Jus Gentium represent the two great phases of Roman development. The Jus Civile was the law of the city, the law that governed the municipality, applicable only to the citizens of a Roman conmunity. But gradually, as Rome developed into a world empire, the Civil Law became the Jus Gentium, the law of mankind. The Romans themselves fully recognized the distinction. The one bound only Roman citizens, while the other bound all who came under Roman domination. Out of the Jus Gentium came the early conception of equity. There could not, under the impress of the Greek influence, be one kind of justice for a Roman citizen and another for a Roman subject. The Code of Nature never found recognition in the Roman system. With the Roman the edict was law. There was, however, even in the harsh development and execution of the Roman civil and criminal administration of law, a philosophical substratum discoverable in the Roman idea of the rule of reason. The result being that justice, equitable in form and application, is purely Roman. By no other process could harmony have been produced. (Charles Kerr, The Philosophical Side of the Law, in the Virginia Law Review, March 1926. one and indivisible. Even in those cases where the rigors of strict law are tempered by special jurisdictions or under special circumstances or by special considerations, it is held that justice and nothing but justice is administered. Therefore, Equity, as conceived and practiced in the Anglo-Saxon world, is a concept that has no equivalent in our system of law. For this reason, no attempt could be made to graft onto a civil code a division of the right of domain into "legal ownership" and "equitable title." In this connection Maurice Travers says: The property right of the trustee, as conceived by the Anglo-American law, is thus something entirely special and unknown in the French law. The words which express that right, "legal ownership," could not be translated into French. The same remark may be made generally with regard to the Spanish law and the Spanish language. Consequently, in order to accomplish the purpose of the trust in a civil law system it is indispensable to make the trustee an ordinary or regular owner enjoying and exercising all the powers and attributes inherent in the right of ownership. In doing this we act in the same manner as the Romans, who constituted a regular heir or legatee for the purpose of a fidei commissum. The trustee, being an ordinary owner, if the trust property is personal, will hold and possess it, and as we know, in civil law the physical act of possession of personal property constitutes a form of title. If the trust property is real, the trustee shall be entered as owner in the Public or Land Registry, and the recorded conditions of the trust will establish the extent of his rights of ownership. If by the terms of the trust the trustee is empowered to encumber, sell, donate, or otherwise dispose of the property, he can do so as any real estate owner. On the contrary, if in compliance with the terms of the trust, he is obliged to retain, administer and conserve the property, he will not be able to alienate it or encumber it, and if he should do so, the sale, mortgage or other lien would be null and void, as effected against a specific provision of the law. This means that we hold the property rights of the civil law trustee to be not absolute. They are limited by the terms of the trust and by the right of the beneficiary under the trust. This limitation is wholly within the spirit and the tradition of the civil law. In the Latin juridical system ownership cannot be recognized as real in one individual and fictitious in another individual. But ownership may be limited and the attributes, effects or manifestations of ownership may be divided among several individuals, as for instance in the case of easement or servitudes, usufruct, use and habitation, or in the case of conditions determining a transfer of property rights from one person to another, or in the case of certain contracts, such as pledge, mortgage, antichresis, lease, emphyteusis or commodatum, which create what we call real rights. In all these cases the domain of the naked owner is limited by the real right which any other person may enjoy by reason of any of the aforementioned contracts. Therefore, the property of the trustee in the civil law would be or is fiduciary property. His ownership is real in the eyes of the law, but it is subject to and limited by the purposes and conditions of the trust. CHARACTERISTICS OF THE RELATIONSHIP Let us now examine the point of the nature of the institution as it appears to the Latin mind, or to be more exact, to my Latin mind. A great many definitions have been given of both the Roman fidei Commissum and the English trust and if they are carefully compared it will be seen that they coincide in one fundamental element: that the fiduciary heir or legatee and the trustee is always a person who executes a charge given him by another person for the benefit of a third party. In the Roman fidei commissum the fiduciary was enabled to carry his charge into effect by instituting him heir, although he did not acquire the inheritance for himself, and was obliged to conserve it and restore it to the beneficiary. In the English trust the trustee is enabled to act in a similar manner by giving him legal title over the trust property. Consequently, if in both the fidei commissum and the trust, what the fiduciary or trustee does is to execute a charge of the settlor or testator, and if in the civil law a mandate is a contract in which one person entrusts to another the direction and execution of a certain business matter, it follows that mandate is the civil institution having the closest resemblance to the trust, and that a trust may be assimilated to a mandate in which the settlor is the principal and the trustee the agent or attorney-in-fact. That the Latin mind is strongly influenced by this analogy is demonstrated by the fact that the French tribunals have repeatedly pronounced the validity of trusts by the technique of assimilating the trustee to a mandatary. Lepaulle, profound expounder of the trust from the point of view of the French law, says: French jurisprudence has sometimes assimilated the trust to a mandate, and that is proof that the two institutions may sometimes discharge the same functions. In the monograph I have already referred to, Maurice Travers says: From the standpoint of considerations, the decisions (of the French courts) are divided into three categories. Some are based on the idea that the trust contract is a fiction and that the trustees would be mere depositaries or mandataries. The trustees in effect are classified as mandataries in the following decisions: Tribunal Civil de la Seine, December 10, 1880, aff. Comte de Palikao. Tribunal Civil de la Seine, June 28, 1901, aff. Van der Heydt et Burth. Cour d'Appel de Toulouse, July 18, 1905, aff. Kerr. Cour de Cassation de Paris, February 19, 1908, aff. Kerr. Tribunal Civil de la Seine, December 19, 1916. Tribunal Civil des Alpes Maritimes, February 22, 1928. In the second Kerr case above-mentioned, the Cour de Cassation, the highest French tribunal, assimilated the trustees to mandataries, by saying that they were "charged with the representation of the obligees in their relations with the company." 118007 0-39-2 Judging by the number of decisions rendered by the French courts and by the opinions of eminent jurists, the trust, therefore is assimilated to the contract we call the civil law mandato, corresponding to what you usually refer to as power-of-attorney. However, is the concept of mandate sufficient in itself to characterize the trust? Evidently not, because if it were, the purposes of the trust could be accomplished by means of mandates and that is not the case. Here are the reasons: A mandate is extinguished by the death of the principal and may be revoked by him at any time. This suffices to show that the ordinary mandate of the civil codes would be altogether inefficacious to meet the situations that are settled by means of trusts. It is of the essence of the trust to be irrevocable as it is also of the essence of donations inter vivos. It is true that in some instances revocable trusts are recognized by the Common Law, but to the Latin mind they are the exception which confirms the rule. Moreover, there is no need in civil law for revocable trusts because the purposes of a revocable trust may be accomplished through an ordinary mandate without any difficulty. Another consideration is that a trust cannot be revoked where vested rights have been created by its own terms. We consider that in principle a trust should not be revocable by the sole will of the settlor, and that it must be extinguished only by causes specifically defined by the law. We consider that if the settlor retains the power at any time to revoke the trust, the trustee could not have the freedom of action and the independence that are indispensable for the discharge of his function, and the institution would fall by its base. Therefore, we cannot see the trust in any other light than that of an irrevocable act, an irrevocable mandate, by means of which the settlor parts with his property or a portion thereof and creates an independent patrimony of which the trustee becomes owner with the charge of fulfilling the conditions of the trust. Conceived in this manner, the trust was very easily transplanted into the civil law of the Republic of Panama. STATUS OF THE TRUST IN CIVIL LAW How should the trust be classified in the civil law? Should it be looked upon as a contract, as a unilateral act, as an obligation, or a right real or personal of the beneficiary? The Anglo-American authors have variously designated the trust as "a confidence", "a holding of property", "a right of property", "an equitable right, title or interest in property", and "an obligation." The latest Louisiana Trust Estate Act, following the terms of the definition adopted by the American Law Institute, refers to the trust as "a fiduciary relationship", and Lepaulle, after a very Perspicacious analysis, calls it simply "a juridical institution" consisting of two elements: a patrimony and a charge thereon (un patrimonine et une affection). I deem it impossible, and to a certain extent impractical, to place the Anglo-American trust within the narrow limits of one single classification in civil law. The trust is so flexible in its nature, so varied in its forms, so multifarious in its purposes and effects, that sometimes it appears as one thing, sometimes as quite another thing. A trust created out of pure liberality looks like an altogether unilateral act, like a testament, while a trust established for instance to liquidate a bankruptcy or to pay a debt by means of an antichresis might present very strongly the characteristics of a contract involving mutual obligations. Moreover, the trust presents different aspects according to the point of view that is taken. From the standpoint of cestui, it is of course a "right, title or interest"; from that of the settlor, it is "a confidence"; from the standpoint of the trustee, it is a "holding of property" and "an obligation"; this latter concept is particularly strong, for if there was no obligation on the part of the trustee to comply with the charge, the trust could not be operative. Having in mind that the source of the trust is the will of the settlor, a tendency to consider it as a unilateral act, of the nature of a testament or a donation, would be quite natural to the Latin viewpoint. However, a trust such as the one created by the law of Panama and of Puerto Rico, presents in general the characteristics of a contract, which creates rights and obligations between the three parties thereto. In the first place, the legal existence of the trust begins when the trustee accepts his commission. By such an acceptance he assumes an obligation in respect of the settlor to comply with the terms of the trust and an obligation in respect of the cestui to give him or do for him the things provided in his benefit, not only by the trust instrument itself, but also by the law. Several articles of the Panama and Puerto Rican statutes establish the manner in which the trustee must manage the trust property. But the trustee does not only assume obligations. He acquires a right to receive compensation for his work, unless otherwise agreed upon. The cestui que trust in turn acquires a right to receive the benefit provided for him. The law gives him also the right to demand in Court removal of the trustee for specific causes of maladministration also defined by the law. He can also petition the Court for protection of the trust property against loss or impairment. As to the settlor, it would appear at first sight that once he transfers the property to the trustee for the trust purposes, he is out of the picture and does not retain any right, but that is not the case. For the law provides that when the trust is extinguished for certain causes, the property in the possession of the trustee must revert to the settlor, which means that the settlor has a right of recovery as against the trustee. French authors and French jurisprudence show themselves to favor the theory that a trust is a contract. Lepaulle says, in a chapter referring to the fiscal aspects of the foreign trust: Fees are dues in all cases where the trust act is a synallagmatic contract. (Op. cit. p. 340.) Maurice Travers states in a more specific manner: Three persons, whose roles may frequently be partially reunited are consequently called upon to figure in the trust contract. (Op. cit. p. 522.) The Toulouse Court in the introductory part or considerations of the Kerr case stated: Whereas the trust contract produces the effect in certain cases of dividing the right of ownership in such a manner as |