1.

Basic Structure of Trusts:

 Involves a Settlor, Trustee, and Beneficiary.
 Settlor transfers assets to Trustee for the benefit of Beneficiaries.
2. Creation of Trusts:
 Established through written documents (settlement or declaration of trust).
 Documents outline duties and powers of Trustee.
3. Legal Framework:
 Governed by the Trustees Act or the Trustees (Perpetual Succession) Act
(Cap.164).
 Subject to statutes like the Income Tax Act and the Tax Procedures Act.
4. Registration:
 Trust deeds should be stamped and registered at the Lands Registry under the
Registration of Documents Act.
 Unincorporated Trusts lack distinct legal personality.
5. Challenges of Unincorporated Trusts:
 Trust can only act through trustees, not in its own name.
 Changes in trustees require updates on every ownership document.
6. Importance of Registration under Trustees (Perpetual Succession) Act:
 Grants separate legal status to the Trust.
 Allows the Trust to own property, enter contracts, etc., in its own name.
7. Incorporation Process:
 Trustees appointed for specific purposes can apply for incorporation under the
Act.
 Certificate of incorporation vests property in the newly incorporated body.
8. Benefits of Incorporation:
 Provides a separate legal identity for the Trust.
 Facilitates smooth operation and management of Trust assets.
9. Legal Mandates:
 Section 3(1) of the Act allows trustees to apply for incorporation.
 Section 4 confers property ownership upon issuance of the certificate of
incorporation.
10. Common Mistakes:
 Failure to register under the Trustees (Perpetual Succession) Act.
 Missing out on the benefits of incorporation and separate legal status.

This structured approach covers the essential aspects of trusts in Kenya, offering concise
points for easy understanding and reference.