The Beneficiary's Ownership Rights in the Trust Res in a Liberal Property Regime
| Published date | 01 May 2023 |
| Author | Hanoch Dagan,Irit Samet |
| Date | 01 May 2023 |
| DOI | http://doi.org/10.1111/1468-2230.12788 |
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Modern Law Review
DOI:10.1111/1468-2230.12788
The Beneciary’s Ownership Rights in the Trust Res
in a Liberal Property Regime
Hanoch Dagan∗and Irit Samet†
This article argues that a liberal theory of property rights can help us resolve a century old
debate about a foundational aspect of the trust, namely, the nature of the beneciary’s interest.
According to orthodoxy, the beneciary has a (weak form) of proprietary right to the tr ust
res. But proponents of this view found it hard to defend it from attacks by Maitland and his
successors who argue that central aspects of the beneciary’s right imply that the beneciary’s
rights should be classied as a personal right against the tr ustee. The reason for their failure,we
argue,is the misguided picture of property rights, as essentially the r ight to exclude,which they
share with proponents of the obligation theory. Liberal property theory,by contrast,gives pride
of place to divided ownership,of the kind exemplied by the trust, and accounts for all aspects
of the beneciary’s right.
INTRODUCTION
Generations of private law scholars have struggled with the proper classication
of trust beneciaries’ rights. Courts,to be sure,routinely refer to it in proprietary
terms (as in ‘the beneciary’s interest’),and this conventional description is not
bereft of scholarly support. But a erce opposition persists. Revisionists high-
light the sharp dierence between beneciaries’ rights and those of full-blown
owners,which makes, they argue,any talk of ‘the beneciary’s proprietary right’
amisnomer that obscures their true obligatory nature. They acknowledge (how
could they ignore?) the unique nature of these non-proprietary rights, which
led the most recent revisionist account to suggest that we need a third cate-
gory – right against r ight (RAR) – in order to properly capture their essence
that is (so the argument goes) the distinctive signature of equity.
In this paper we show that in spite of the doctrinal focus of this century-old
debate, what may come across as purely analytical, coherence-driven moves,
implicate deeper jurisprudential grounds, dealing with the normative founda-
tions of property and the nature of property rights. This change of focus from
∗Stewart and Judy Colton Professor of Legal Theory and Innovation and Director of the Edmond J.
Safra Center for Ethics, Tel-Aviv University.
†Professor of Law, Dickson Poon School of Law, King’s College, London. We are grateful to
Martin Dixon, Simon Douglas, Josh Getzler, Adam Hofr i-Winogradov, Jessica Hudson, Ben
McFarlane,James Penner, Lionel Smith,William Swadling,Sam Williams,participants in King’s Col-
lege Private Law Forum,the joint session of the Oxford’sObligations and Property Discussion Groups,
the Cambridge Private Law Centre Research in Progress Seminar, the conference on Equity: 150
Years After the Judicature Reform, and two MLR anonymous referees for their helpful comments.
All URLs last visited 14 December 2022.
© 2023 The Authors.The Modern Law Review published by John Wiley & Sons Ltd on behalf of Modern Law Review Limited.
(2023) 86(3) MLR 701–728
This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits
use and distribution in any medium, provided the original work is properly cited,the use is non-commercial and no modications or
adaptations are made.
The Beneciary’s Ownership Rights
the doctrinal-analytical to the normative enables us to make two contributions
to the debate: rst, seeing much more clearly why the obligation interpretation
of the beneciary’s right is an unjustied deviation from a well-established
orthodoxy; second, understanding why former proprietary accounts could
not achieve a breakthrough in the debate. In a nutshell, the answer to the
rst question is that writers in the obligation school tend to found their
opposition on an obsolete and morally bankrupt exclusion-based view of
property, roughly following Blackstone’s view of property as ‘sole and despotic
dominion.’1The answer to the second question is that while (some) defenders
of the conventional classication of the beneciary’s rights as propr ietary try
to distance themselves from this conception of property, they mostly share
a commitment to some form of the debunked exclusionary perception of
property. As a result, their account(s) remain shaky and the stando persists.
In this article we show that resolving this debate about the foundation of trust
requires a solid foundation in property theory. Thus,although at times our inter-
vention deploys some familiar arguments from this long-standing controversy,it
situates them on a rm foundation that vindicates the proprietary nature of the
beneciary’s interest while addressing all the qualms such classication raises
under competing conceptions of property.
We nd the missing theoretical foundation in a recent theory of liberal
property, which one of us develops elsewhere.2Property on this view is an
autonomy-enhancing institution; one of the major legal tools that serve the
primary commitment of every liberal polity to secure and facilitate people’s
foundational right to self-determination (not to be confused with their nega-
tive liberty).As such, liberal property requires law to facilitate in each important
area of human action and interaction a diverse set of stable frameworks of pri-
vate authority (‘property types’) so that people can set up – on their own or
with the cooperation of others – long-term plans.
Owners can legitimately expect others to respect their private authority over
‘legal things’(objects, or resources,tangible or intang ible)and are, moreover, jus-
tied in recruiting the coercive power of the state to vindicate this authority,
because we are all justiably expected to respect other people’s right to auton-
omy. Since that right is property’s justicatory premise, property’s legitimacy
requires the private authority of all property types to be circumscribed in line
with their service to people’s autonomy and in compliance with relational jus-
tice, namely: reciprocal respect for self-determination.
As we demonstrated in previous work, the express trust plays a key role in
this scheme of liberal property.3Liberal property law should allow autonomous
individuals to reject the state-shaped frameworksand decide for themselves how
to arrange their interpersonal relationships, provided they take into account the
interests of third parties. This means that proper ty law must instantiate more
than the rich variety of state-shaped frameworks mentioned above;it should also
1 2 Bl Comm 1765-1769.
2 Hanoch Dagan,A Liberal Theory of Property (New York,NY: Cambridge UniversityPress, 2021).
3 Hanoch Dagan and Irit Samet, ‘Express Trust as the Missing Piece in the Property Jigsaw’ in
Simone Degeling, Jessica Hudson, and Irit Samet (eds), Philosophical Foundations of Express Trust
(Oxford: OUP, forthcoming).
702 © 2023 The Authors.The Modern Law Review published by John Wiley & Sons Ltd on behalf of Modern Law Review Limited.
(2023) 86(3) MLR 701–728
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