Report No. 17

Section 4.- For section 4 of the principal Act, the following section shall be substituted, namely:-

"4. Purpose of trust to be lawful.-(1) A trust may be created for any lawful purpose.

(2) The purpose of a trust is lawful unless-

(a) it is forbidden by law, or

(b) it is of such a nature that, if permitted, it would defeat the provisions of any law, or

(c) it is fraudulent, or

(d) it involves or implies injury to the person or property of another, or

(e) the court regards it as immoral or opposed to public policy.

(3) Every trust of which the purpose is unlawful is void, and where a trust is created for two purposes, of which one is lawful and the other unlawful, and the two purposes cannot be separated, the whole trust is void.

Explanation.-In this section, the expression "law" includes, where the trust-property is immovable and situate in a foreign country, the law of such country".