A Defense of Perpetual Trusts

This essay emphatically defends perpetual trusts and recent state-level repeals of the Rule Against Perpetuities. The scholarly debate over the category of perpetual trusts has focused exclusively on one type—the Dynasty Trust—which is designed to perpetuate wealth within families by exploiting a tax loophole. The unsavory nature of both Dynasty Trusts and the legal reform movement that spawned them has blinded critics to a universe of perpetual trusts that are socially beneficial. Previously, new types of trusts that required perpetuity could only achieve it through statutory exemption. Private Foundations and Stewardship Trusts were each granted perpetuity by legislatures. Now that perpetual trusts are accessible to all, new socially beneficial types, such as the Ancestor Trust, are bound to emerge. The essay also walks through some abstract arguments for and against the existence of perpetual trusts, and provides a brief history of the Rule Against Perpetuities