This document discusses two types of trusts: discretionary trusts and protective trusts. Discretionary trusts allow trustees to distribute trust property to beneficiaries at their discretion. There are two types: exhaustive trusts, where trustees must distribute all income, and non-exhaustive trusts, where trustees can accumulate benefits and determine beneficiaries and portions. Protective trusts are designed to protect trust property, protecting a settlor's assets during their lifetime from events like bankruptcy, divorce, or taxes. They prevent wasteful or financially irresponsible beneficiaries from alienating or claiming trust property.

1. 1. DISCRETIONARY TRUSTS/AMANAH BUDI BICARA
 DEFINISI:Trustswhere propertyisconveyedtotrusteestobe heldbythemontrust
to applythe income or the capital or bothfor the benefitof the membersof aclass
of beneficiariesinsuchproportionsasthe trusteesshall,intheirabsolutediscretion
thinkfit.
 3 SEBABWUJUD
1. Bagi membolehkanbeneficiariesmenghadapi keadaan2yangtidakdiduga
2. Melindungi hartadrpdbeneficiariesyangboros
3. Utk elaktrust propertymenjadi asetuntukmenghapuskankebankrapan.
 TYPES
o Exhaustive DT:DT YANG LENGKAP- Doc agreementyanglengkapttgtrusttu
 Trustee mustdistribute all income accruingtothe trustproperty;
 Trustee cannotaccumulate eitherthe interestorthe capital of the
TP;
 Trustee discretionisinthe proportiontobe giventoeach
beneficiary.
o Non-exhaustive DT:
 Trustee can accumulate trustbenefitsandhisdiscretionliesinthe
fact that he can determine whothe beneficiaryisandthe portionor
beneficial interestof the beneficiaries.
 Trustee have an expresspowertoaccumulate income.
2. PROTECTIVE TRUSTS/ AMANAH PERLINDUNGAN
 Trust designedtoprotectthe trustproperty.Itprotectsthe assetsof the settlorin
hisor her lifetime fromthe effectof eventssuchassettlor’sbankruptcy,divorce or
tax protection.
 What? –a device for a settlor who wishes to protect his property against :
o A wasteful orfinanciallyirresponsible beneficiary;
o Alienationorbankruptcyof sucha beneficiary.
 In the US –knownas the ‘spend-thrifttrust’.
 Undang2 Malaysia:
o A protective trustinvolvesthe creationof a ‘determinable
interest’(kepentinganyangdiduga/ditentukan) (asopposedtoconditional
interest) infavourof athird party;coupledwiththe provisionforagiftover
to the trusteestoholdon discretionarytrustinfavourof a class uponthe
occurrence of certaindeterminableevents;
o Define alsoinSection38 of the Trustee Act 1949
DETERMINABLE INTEREST
o A can use my car ‘until’he buysone himself whereuponthe cargoesto hiswife C;
o A can use my car until he changeshisnationalitywhereuponthe cargoesto hiswife
C;
CONDITIONALINTEREST
o A can use my car on conditionthathe doesnot buya new one,if he buys a new one
thenthe car goesto hiswife C;
o A can use my propertyonconditionthathe doesnot change hisnationality….;