2215.

Trusts classified. A trust is either:

1. Voluntary; or,

2. Involuntary. En. March 21, 1872. Cal. Rep.Cit. 58, 483; 132, 26.

§ 2216. Voluntary trust, what. A voluntary trust is an obligation arising out of a personal confidence reposed in, and voluntarily accepted by, one for the benefit of another. En. March 21, 1872.

Cal Rep. Cit. 85, 445.

§ 2217. Involuntary trust, what. An involuntary trust is one which is created by operation of law. En. March 21, 1872.

Cal.Rep.Cit. 76, 471; 99, 590.

Involuntary trust: See post, secs. 2223, 2224.

§ 2218. Parties to the contract. The person whose confidence creates a trust is called the trustor; the person in whom the confidence is reposed is called the trustee; and the person for whose benefit the trust is created is called the beneficiary. En. March 21, 1872.

Cal. Rep.Cit. 82, 374.

§ 2219. What constitutes one a trustee. Every one who voluntarily assumes a relation of personal confidence with another is deemed a trustee, within the meaning of this chapter, not only as to the person who reposes such confidence, but also as to all persons of whose affairs he thus acquires information which was given to such person in the like confidence, or over whose affairs he, by such confidence, obtains any control. En. March 21, 1872. Cal. Rep. Cit. 72, 559; 82, 373; 85, 446; 120, 323; 120, 678; 125, 683; 130, 357; 133, 493.

A

§ 2220. For what purpose a trust may be created. trust may be created for any purpose for which a contract may lawfully be made, except as otherwise prescribed by the titles on Uses and Trusts and on Transfers. En. March 21, 1872.

Cal. Rep.Cit. 58, 482; 58, 483; 71, 532; 108, 656; 123, 144.

§ 2221. Voluntary trust, how created as to trustor. Suvject to the provisions of section 852, a voluntary trust is created, as to the trustor and beneficiary, by any words or acts of the trustor, indicating with reasonable certainty:

1. An intention on the part of the trustor to create a trust; and,

2. The subject, purpose, and beneficiary of the trust. En. March 21, 1872.

Cal.Rep.Cit. 58, 483; 70, 452; 79, 625; 95, 167; 106, 656; 112, 284; 122, 25; 124, 421; 126, 191; 132, 27; 135, 367; 136, 96.

Creation of involuntary trust: See secs. 2223, 2224. Trusts for benefit of third persons: See post, sec. 2251.

§ 2222. How created as to trustee. Subject to the provisions of section 852, a voluntary trust is created, as to the trustee, by any words or acts of his indicating, with reasonable certainty:

1. His acceptance of the trust, or his acknowledgment, made upon sufficient consideration, of its existence; and, 2. The subject, purpose, and beneficiary of the trust. En. March 21, 1872.

Cal.Rep.Cit. 77, 339; 79, 625; 85, 446; 95, 167; 108, 656; 122, 25; 132, 27; 135, 367; 136, 155; 137, 636.

§ 2223. Involuntary trustee, who is.

One who wrongfully detains a thing is an involuntary trustee thereof, for the benefit of the owner. En. March 21, 1872.

Cal.Rep.Cit. 58, 121; 58, 122; 107, 377; 118, 106.

Compensation of involuntary trustee: See sec. 2275.
Involuntary trustee, who is: See post, sec. 2243.

§ 2224. Involuntary trust resulting from fraud, mistake, etc. One who gains a thing by fraud, accident, mistake, undue influence, the violation of a trust, or other wrongful act, is, unless he has some other and better right thereto, an involuntary trustee of the thing gained, for the benefit of the person who would otherwise have had it. En. March 21, 1872.

Cal. Rep.Cit.

55, 562; 58, 122; 76, 471; 77, 339; 85, 35; 103, 183; 107, 377; 112, 286; 132, 5; 133, 493.

58, 123; 67, 237; 71, 110; 85, 445; 86, 600; 98, 93; 118, 106; 126, 192; 131, 74;

Involuntary trustee. who is: Post, sec. 2243; compensa

tion of: Post, sec. 2275.

§ 2228.

§ 2229. § 2230. 2231. § 2232.

§ 2233.

§ 2234.

§ 2235.

§ 2236. § 2237. § 2238. § 2239.

Trustee's obligation to good faith.

Trustee not to use property for his own profit.

Certain transactions forbidden.

Trustee's influence not to be used for his advantage.

Trustee not to assume a trust adverse to interest of

beneficiary.

To disclose adverse interest.

Trustee guilty of fraud, when.
Presumption against trustees.

Trustee mingling trust property with his own.
Measure of liability for breach of trust.

Same.

Co-trustees, how far liable for each other.

§ 2228. Trustee's obligation to good faith. In all matters connected with his trust, a trustee is bound to act in the highest good faith toward his beneficiary, and may not obtain any advantage therein over the latter by the slightest misrepresentation, concealment, threat, or adverse pressure of any kind. En. March 21, 1872.

Cal.Rep.Cit. 136, 463.

82, 374; 86, 629; 94, 647; 112, 61; 133, 493;

§ 2229. Trustee not to use property for his own profit. A trustee may not use or deal with the trust property for his own profit, or for any other purpose unconnected with the trust, in any manner. En. March 21, 1872.

Cal.Rep.Cit. 82, 374; 93, 30; 97, 410; 109, 177; 112, 61: 120, 471; 124, 181; 130, 257; 131, 659; 133, 639. Purchaser from trustee charged with the trust, when: Post, sec. 2243.

Presumption of undue influence on transactions between the trustee and beneficiary: Post, sec. 2235; violations of the duties of the trustee are fraudulent: Post, sec. 2234.

§ 2230. Certain transactions forbidden. Neither a trustee nor any of his agents may take part in any transaction concerning the trust in which he or any ore for whom he acts as agent has an interest, present or contingent, adverse to that of his beneficiary, except as follows:

1. When the beneficiary, having capacity to contract, with a full knowledge of the motives of the trustee, and of all other facts concerning the transaction which might affect his own decision, and without the use of any influence on the part of the trustee, permits him to do so;

2. When the beneficiary not having capacity to contract, the proper court, upon the like information of the facts, grants the like permission; or,

3. When some of the beneficiaries having capacity to contract and some not having it, the former grant permission for themselves, and the proper court for the latter, in the manner above prescribed. En. March 21, 1872.

Cal. Rep.Cit. 54, 106; 81, 319; 81, 323; 86, 629; 98, 177; 112, 61; 113, 237; 121, 285; 121, 287; 130, 257; 130, 433; 131, 659; 138, 95.

Duty to inform beneficiary: Sec. 2233, infra.

Undertaking inconsistent trust: Post, sec. 2232.

§ 2231. Trustee's influence not to be used for his advantage. A trustee may not use the influence which his position gives him to obtain any advantage from his beneficiary. En. March 21, 1872.

Cal.Rep.Cit. 94, 461; 103, 101; 113, 237; 138, 95.

§ 2232.

Trustee not to assume a trust adverse to interest of beneficiary. No trustee, so long as he remains in the trust, may undertake another trust adverse in its nature to the interests of his beneficiary in the subject of the trust, without the consent of the latter. En. March 21, 1872. Cal.Rep.Cit. 113, 237; 121, 328; 138, 95. Compare, ante, sec. 2230.

Trustee's duty to disclose adverse interest: Compare with sec. 2233, post.

Removal of trustee: Post, secs. 2282, 2283.

2233. To disclose adverse interest. If a trustee acquires any interest, or becomes charged with any duty, adverse to the interest of his beneficiary in the subject of the trust, he must immediately inform the latter thereof, and may be at once removed. En. March 21, 1872. Cal.Rep.Cit. 55, 562; 86, 629; 113, 237.

$2234. Trustee guilty of fraud, when. Every violation of the provisions of the preceding sections of this article is a fraud against the beneficiary of the trust. En. March 21, 1872.

Cal.Rep.Cit. 52, 406; 81, 319; 86, 629; 94, 461; 97, 410; 103, 102; 113, 237; 121, 328; 131, 79; 138, 95.

2235. Presumption against trustees. All transactions between a trustee and his beneficiary during the existence

of the trust, or while the influence acquired by the trustee remains, by which he obtains any advantage from his beneficiary, are presumed to be entered into by the latter without sufficient consideration, and under undue influence. En. March 21, 1872.

Cal.Rep.Cit. 54, 440; 72, 559; 73, 161; 75, 529; 82, 374; 94, 461; 103, 100; 103, 101; 120, 323; 120, 324; 130, 357; 130, 358; 134, 172; 134, 173; 136, 463; 137, 183; 137, 693; 137, 695; 137, 697.

§ 2236. Trustee mingling trust property with his own. A trustee who willfully and unnecessarily mingles the trust property with his own, so as to constitute himself in appearance its absolute owner, is liable for its safety in all events. En. March 21, 1872.

Cal.Rep.Cit. 97, 202; 120, 536; 120, 537.

§ 2237. Measure of liability for breach of trust. A trustee who uses or disposes of the trust property, contrary to section 2229, may, at the option of the beneficiary, be required to account for all profits so made, or to pay the value of its use, and, if he has disposed thereof, to replace it, with its fruits, or to account for its proceeds, with interest. En. March 21, 1872.

Cal.Rep.Cit. 55, 563; 120, 471; 133, 639.

Liability for noninvestment of funds: See post, sec. 2262. Degree of diligence requisite: Post, sec. 2259.

§ 2238. Same. A trustee who uses or disposes of the trust property in any manner not authorized by the trust, but in good faith, and with intent to serve the interests of the beneficiary, is liable only to make good whatever is lost to the beneficiary by his error. En. March 21, 1872. Cal.Rep.Cit. 136, 445.

Α

$2239. Co-trustees, how far liable for each other. trustee is responsible for the wrongful acts of a co-trustee to which he consented, or which, by his negligence, he enabled the latter to commit, but for no others. En. March 21, 1872.

Cal.Rep.Cit. 87, 6; 120, 471.

Compare, also, this section with sec. 2268, post.