Consulting on use of trusts

As a result of large-scale amendment of the Trust Act in 2006, a number of objectives which were not possible with other schemes before became possible to realize through trust schemes . These trust schemes, which are also known as private trusts and family trusts, are attracting very high levels of attention as schemes that should be considered when thinking about inheritance and business succession.

Yamada & Partners proposes tailor-made trust schemes to realize clients’ diverse visions.

Examples of schemes using trusts

1. Placing a company’s own stock into trust

When a company’s current management awards shares of stock to the succeeding management use of a trust makes it possible to award only the property rights of the stock to the succeeding management while the current management maintains the management rights even after the shares are awarded.

2. Testamentary trust

In this kind of trust, the trustor retains the rights to his or her own property while he or she is still alive, and then after the trustor’s death, rights to the property will be succeeded by a person designated through the trust. It’s called a testamentary trust because it has the same effects (e.g., specifying the successor to property) as a last will and testament.

3. Successive beneficiary trust

A will specifying that, for example, an elder son would inherit the parent’s property after his parent’s death , and then the second son would inherit it after the elder son’s death which might not be legally enforceable. But use of a trust makes it possible to meet clients’ needs such as this.

4. Welfare trust

The adult guardianship system is one way of helping elderly or disabled people who are unable to enter into contracts on their own concerning their own property. A trust scheme can provide the same kind of help. In the case of a trust, it is possible to set up assistance plans with a greater degree of flexibility, since the system is specified in a contract between the parties.