Fee Tail

A fee tail or entail is a form of trust under common law which is similar to a fidei comissum under civil law. The entrusted assets are always linked to real estate. Trust beneficiaries receive usufructuary rights to the entrusted assets, rather than obtaining ownership.

Unlike other forms of trusts, in which the trustor names individual trust beneficiaries, an entail trust allows trustors to stipulate unnamed trust beneficiaries. For example, a trustor may specify a family connection which determines trust beneficiaries – such as the children of the previous beneficiary.

Because trust beneficiaries do not become owners of the real estate but simply receive usufructuary rights to it, they cannot sell the property or leave it to other parties in their will. Much like a corporation, once an entail trust has been created, the entailed property becomes an entity in itself which is not linked to a specific person.

Entail trusts give trustors far more control over the future management of their assets than other forms of trusts do.

Some jurisdictions in which entail trusts are allowed restrict the validity of an entail trust to a specific number of generations. Some jurisdictions allow trust beneficiaries to sell the entailed real estate, but inheritance of the property must follow the stipulations set out in the trust deed.

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