Introduction to the British "Usse" System - Exploring the History of Trust (III)

From a common law perspective, the rudiments of the trust system can be traced back to the 11th-century "Use".

In the centuries after the Norman conquest of England, a truly land-related ownership system began to take shape. Under the feudal system, land was often accompanied by different levels of rights. Rights at all levels are integrated through a land tenure system. Under this system, different occupiers ("tenants") can have rights to the same piece of land. At the very top of the system are the kings, and at the bottom are the individuals who actually occupy the land. Lords large and small ("mesne lords") in between. This system is essentially a taxation system. Each occupier, by occupying and using the land, contributes to the labor force, harvests the crops, and pays the proceeds to its lord, as the lord leases the land to the rent for his use. Under this system, individuals often inherit a certain level of territorial sovereignty ("seigneury"). And the use of land is also classified, some are for the maintenance of knights, the so-called "knightservice"; Some of them are cultivated crops, so-called "socage".

The existence of this feudal system is considered to be the social context in which the Eusian system was born in the true sense.

Some views attribute the emergence of the Euthic system to specific historical events, such as the Crusades and the promulgation of the Ordinance of Confiscation by Henry III. Such definitions may adequately reflect the main uses of the Eusian system in a particular historical period, but as the reason for its birth, they may be incomplete.

The Uss system addressed and solved a series of problems, or flaws, in this feudal system. For example, land cannot be freely distributed in the form of a will, but must be primogeniture. The advantage of the primogeniture system is that it can ensure the integrity of the land and will not be torn apart by generations of inheritance; But on the other hand, it makes it impossible for the heirs to realize the expectation that all their children will be cared for after their deaths.

Another problem is that being limited by religious precepts makes it impossible for some people, like monks, to hold land in their own name. In addition to this, there were constant conflicts between the British aristocracy, especially during the War of the Roses, when the situation was chaotic. Once a lord chooses the wrong person to support, the consequence is likely to be that his territory is deprived, not only his own future is ruined, but his family and descendants also lose the territory on which to live. Other lords wanted long-term control of their territories, giving themselves right of wardship as soon as they handed over sovereignty to their younger children. And use this right to actually administer the territory and obtain benefits until death.

The Euthic system, as a solution, could effectively solve the above problems: although the lord could not distribute the land in the form of a will, he could dispose of the land during his lifetime. Thus Lord A could transfer the land to X, Y, and Z as co-owners of the land. Of course, the direct transfer of land to others made no sense to the lord, because it meant that he transferred all the rights related to the land. Therefore, he would make the transfer in the form of "use": the land was transferred to X, Y and Z for use by the person designated by A. This designated person is called the beneficiary and has the right to benefit from the land. A can designate anyone to enjoy the land in any way A wishes.

In the example above, it's not one person who gives land, it's X, Y, and Z. The purpose of this arrangement was to take advantage of the common law co-owners of the time, which is now known as joint tenancy. Under the co-ownership arrangement, when one of the co-owners dies, his share is not transferred to his heirs, and the only result is that the total number of co-owners is reduced by one. So when the lord transfers the land to X, Y and Z in the form of Euth, he does not have to worry about one of them, as if X, when he dies, the heirs of X will have the right to inherit a part of the land; The advantage of having several co-owners is that when one of them dies, as long as there is another co-owner, basically it will not happen that all co-owners die at the same time, and the land can be passed on forever within the family in the way of the Uss system.

Thus the Uss system can successfully solve the problems mentioned earlier. The right to benefit from the land may be assigned to a person other than the eldest son; It can also be assigned to monks. The land can be transferred to a neutral party so that even if A himself chooses the wrong side in the civil war, the land will not be taken away, and A's family can still enjoy the right to benefit from the land. And, by using the Uss system, it was also possible to make it possible for young children to never truly inherit ownership of the land.

It should be noted that the Eusian system has never been recognized by the common law. From a common law point of view, no matter what arrangement is made behind it, X, Y and Z are always the legal owners of the land and therefore have full rights to the land. When X, Y and Z refused to follow their agreement under the Euth arrangement, the parties had to resort to the court of chance. The court of chance and the system of equity were thus linked to the Euthian system and the trust system that followed.

One view of this attitude towards the common law is that it reflects the rigidity and roughness of the common law, and there is no effective system to protect the rights and interests of beneficiaries under the Euthic system; Another view was that it was the common law's refusal to recognize the beneficiaries' interest in the assets under the Euthic system, thus enabling the Euthian regime to achieve many of the unattainable objectives under the common law. Scholars who hold the latter view on the resulting lack of legal protection for the Ussian system argue that in the Middle Ages, the Ussian system relied less on judicial decisions than on the constraints of morality and social opinion. If a person violates the promises he made under the Euthic system, the loss of his reputation and honor must be faced with caution.

After five centuries of development, in 1535, during the reign of Henry VIII in England, Parliament promulgated the Statute of Uses. Ironically, it was this law in the name of Us that led to the gradual withdrawal of the Uss system from the stage of history.

The reason for passing this law was simple, Henry VIII needed more money.

The existence of the Euthic system made it difficult for Henry VIII to deprive the nobles of the proceeds of their estates. To address this issue, the Us Law provides that the arrangement in which the lord transfers land to X, Y and Z in the manner of a Uss for use by Beneficiary B would be considered a direct transfer of land from A to B. In this way, all of Euth's original uses could not be realized.

So for more than a century, medieval lawyers worked tirelessly on ways to circumvent the application of the Us law. They created an arrangement called "the use upon a use" ("the use upon a use"). This tongue twister arrangement is an example in English: A grants asset to B to the use of C to the use of D. The beneficiary C of the previous Uss system actually becomes the nominal asset holder of the latter Uss system, and D is the real beneficiary. By the 18th century, the Uss system had been transformed into a trust system in the modern sense. Words such as "Use" fade away from everyday legal affairs and are replaced by "trust", "trustee", "beneficiary". In this way, the essence of the Euthic system was preserved, and the only thing that changed was the name.

In the 18th century, with the changes in the social environment, the feudal system began to disintegrate, and the trust system began to serve the wider affluent class for the protection and inheritance of their family wealth. With the vigorous development of the Industrial Revolution in the 19th century, the form of wealth also underwent great changes, and correspondingly, the evolution of trust systems and structures became more active. The most significant development of trust law in the 20th century was the rise of offshore lands. These large and small jurisdictions, influenced by common law systems, are competing to develop more flexible legal frameworks to attract large financial institutions and high-asset individuals to set up trusts and management centers there.