Beneficial interest

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A beneficial interest is the right that a person has arising from a contract to which they are not a party, or a trust.^[1] For example, if A makes a contract with B that A will pay C a certain sum of money, B has the legal interest in the contract, and C the beneficial interest.

More generally, a beneficial interest is any "interest of value, worth, or use in property one does not own", for example, "the interest that a beneficiary of a trust has in the trust".^[2] More specifically, it could be:

• "A property interest that inures solely to the benefit of the owner", or
• Property that "remains of an estate after the payment of debts and the expenses of administration", or
• The right of a person having a power of appointment to appoint himself".^[2]

Black's Law Dictionary defines beneficial interest as "Profit, benefit or advantage resulting from a contract, or the ownership of an estate as distinct from the legal ownership or control."^[3][4] Examples of beneficial interests in mining claims include unrecorded deeds and agreements to share profits, but not mortgages and other liens.^[5] A beneficial interest is also "distinguished from the rights of someone like a trustee or official who has responsibility to perform and/or title to the assets but does not share in the benefits".^[4]

See also

• Asset protection
• Beneficial owner
• Beneficial use
• Corporate benefit
• Lien
• Purpose trust
• Quistclose trust
• Resulting trust
• Use (law)
• Third-party beneficiary
• Trust (law)

References

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