What a Purpose Trust Actually Does
Most trusts name a person or group of people as beneficiaries. A purpose trust is different. It exists to accomplish a specific goal rather than to benefit an identifiable individual. Examples include trusts created to maintain a family cemetery, preserve a collection, or carry out some other lawful objective that does not qualify as a charitable purpose.
A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficiary or for a noncharitable but otherwise valid purpose to be selected by the trustee, provided that the trust may not be enforced for more than ninety years after its creation.
A.R.S. § 14-10409(1)The ninety-year limit keeps these trusts from lasting indefinitely. Unlike pet trusts under A.R.S. 14-10408, which end when the animal dies, purpose trusts need a defined time horizon because there is no natural termination event.
Enforcement and Excess Property
Because there is no beneficiary to speak up if the trustee fails to act, the statute allows the trust document to name an enforcer. If none is named, the court can appoint one. This enforcement mechanism is critical; without it, there would be no one with standing to hold the trustee accountable.
Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use.
A.R.S. § 14-10409(3)If the trust holds more than what is needed, the excess returns to the settlor or the settlor's successors. This safeguard prevents purpose trusts from tying up assets beyond what the stated goal reasonably requires.
