After settlement, who holds legal and equitable ownership?

• A. The legal ownership is held by the trustees and the equitable ownership by the beneficiaries.
• B. The beneficiaries hold legal ownership and trustees hold equitable.
• C. The settlor holds both.
• D. The charity holds both.

Answer: (A)

In a settled trust, ownership is split into two parts: the legal title and the equitable (beneficial) interest. The trustees hold the legal title to the trust property, meaning they lawfully own the property on behalf of the trust and are responsible for its management under the terms of the trust. The beneficiaries hold the equitable interest, which means they are entitled to benefit from the property as specified by the trust, though they do not control the legal title. The settlor creates the trust and transfers the property, but after settlement they do not retain ownership. While a charity can act as a trustee or beneficiary, ownership itself remains divided in this way, with trustees managing the property legally and beneficiaries enjoying the benefits equitably.