Essay
The Secret Life of the Trust:
The Trust as an Instrument of Commerce
John H. Langbein'
In the culture of Anglo-American law, we think of the trust as a branch of the law of gratuitous transfers. That is where we teach trusts in the law school curriculum,' that is where we locate trusts in the statute books,- and that is where American lawyers typically encounter the trust in their practice.
The trust originated at the end of the Middle Ages as a means of transferring wealth within the family,' and the trust remains our characteristic device for organizing intergenerational wealth transmission when the transferor has substantial assets or complex family affairs. In the succinct formulation of Bernard Rudden, Anglo-American lawyers regard the trust as "essentially a gift, projected on the plane of time and so subjected to a management regime."4
t Chancellor Kent Professor of Law and Legal History, Yale University I acknowledge with gratitude the able research assistance of Marie DeFalco. I have discussed the subject of this Essay in lectures at the University of Tennessee College of Law (Knoxville, September 1996) and at the Trust Companies Association of Japan (Tokyo, October 1996). 1 am grateful for references and suggestions from those learned audiences and from Anne Alstot. Mark Ascher. Ian Ayres. Robert Ellickson. Tamar Frankel. Henry Hansmann, John Harvey. Howell E. J…