Opinion ID: 2160801
Heading Depth: 2
Heading Rank: 1

Heading: an express trust was created by agreement of the parties.

Text: An express trust is defined at SDCL 55-1-3 as an obligation arising out of a personal confidence reposed in and voluntarily accepted by one for the benefit of another. SDCL 55-1-3 (1988). Such an obligation is created when the trustor and beneficiary by any words or acts of the trustor indicating with reasonable certainty: (1) an intention on the part of the trustor to create a trust; and (2) the subject, purpose, and beneficiary thereof. SDCL 55-1-4 (1988). The Stock Sale Agreement, signed by both Wettestad and Willers, expressed the parties' intention to create a trust when it stated: Wettestad ... shall at all times act as trustee for Willers with respect to Willers' ownership of fifty percent of the stock of Siouxland International Trucks, Inc., such trust to continue until all shares beneficially owned by Willers shall have been transferred into his name. The subject of the trust is Willers' ownership interest in the shares of stock. The purpose of the trust is the protection of Willers' interest until all shares beneficially owned by Willers were transferred into his name. The beneficiary of the trust is Willers. A trust may be created for any purpose for which a contract may lawfully be made. SDCL 55-1-1 (1988). Therefore, a trust can be created for any purpose that is not illegal. Applegate v. Brown, 168 Neb. 190, 95 N.W.2d 341 (1959). It is the general rule that a contract which is contrary to statutory or constitutional law is invalid and unenforceable. Waara v. Kane, 269 N.W.2d 395 (S.D.1978); Hieb v. Opp, 458 N.W.2d 797 (S.D.1990), (citing State ex rel. Meierhenry v. Spiegel, Inc., 277 N.W.2d 298 (S.D.1979)). As no statutory or constitutional bar prohibits the transaction between Willers and Wettestad, the trial court correctly found that the trust agreement was valid and not invalid as against public policy. Generally, a person who is of full capacity may be a trustee. 76 Am.Jur.2d Trusts § 241 (1992). Therefore, contrary to Wettestad's assertion, he is capable of serving as trustee. While Wettestad's service as trustee may have conflicted with his contractual agreement with International Harvester, the court correctly concluded that he was not prohibited by law from acting as trustee on behalf of Willers.