Section 130 - Explanation as to a gratuitous trustee

Where a person, who is the owner of a thing in that person’s own right and benefit, undertakes to hold or apply the thing as a trustee for another person, the first named person does not become a trustee within the meaning of the provisions of this Act relating to fraudulent breaches of trust, unless that owner has constituted the owner as a trustee by an instrument in writing executed by the owner and specifying the nature of the trust and the person to be benefited by the trust.

Illustration

A, on the marriage of A’s daughter, verbally promises to hold certain of A’s moneys in trust for her daughter and the daughter’s children. A is not a trustee within the meaning of the section; but, if the moneys were entrusted to A by the husband for the wife, A would be a trustee within the meaning of the section.