By: Allyson Kern
The traditional trust has a simple premise: a settlor transfers property to a trustee to hold and manage for the benefit of another.[1] The beneficiary is central to that arrangement. The trustee manages the trust property for the beneficiary, who may enforce the terms of the trust.[2] At common law, a trust generally could not be enforced without an identifiable beneficiary, except in the case of charitable trusts, which the Attorney General could enforce on behalf of the public.[3]
Delaware has expanded beyond that traditional framework. Section 3556 of Title 12 permits a settlor to create a trust for a declared noncharitable purpose that is not impossible of attainment, even when the trust has no identifiable beneficiary.[4] In place of a beneficiary, the trust is organized around a purpose that the settlor wants the property to advance.
That flexibility opens the door to a range of planning objectives. A noncharitable purpose trust can preserve family businesses, maintain family properties and collections, support institutions, protect corporate missions, and pursue other lawful objectives that may outlast the settlor.[5] Delaware also permits noncharitable purpose trusts to exist in perpetuity, subject to statutory limitations that apply to certain interests in real property.[6] Delaware separately recognizes trusts for particular purposes, including maintaining cemetery lots and monuments and caring for specific animals.[7]
One use of purpose trusts is preserving a family business across generations. A settlor can place an interest in a closely held company into a purpose trust designed to preserve the business as a continuing enterprise. Rather than transferring the company to a particular family member and leaving future generations to decide whether to sell or divide it, the trust can establish continued ownership and operation as its purpose.[8]
Purpose trusts can serve institutional purposes as well. Facebook, for example, used a Delaware purpose trust to establish and support its independent Oversight Board, which makes decisions concerning content on Facebook and Instagram.[9] The purpose trust provided a mechanism for funding the Board, while helping maintain its independence from Facebook.
Purpose trusts have also attracted attention as a means of separating ownership from a company’s broader mission. In 2022, founder Yvon Chouinard and his family transferred ownership of Patagonia to the Patagonia Purpose Trust and the Holdfast Collective. The Purpose Trust received Patagonia’s voting stock, while the Holdfast Collective received the company’s nonvoting stock and economic proceeds.[10] The structure separates voting control from economic ownership, while placing Patagonia’s governance in a structure designed to protect the company’s mission and values after Chouinard’s departure.[11]
The absence of a beneficiary, however, creates a potential enforcement problem. Delaware addresses that problem through an “enforcer.” Section 3556 permits the governing instrument to appoint an enforcer and authorizes the Court of Chancery to appoint one if necessary.[12] A person with an interest in the trust’s declared purpose, other than a mere general public interest, may petition the Court of Chancery concerning the appointment or removal of an enforcer.[13] Unless the governing instrument provides otherwise, the enforcer serves as a fiduciary and may enforce the terms of the trust.[14]
Just as a designated representative acts on behalf of a beneficiary in a silent trust[15], an enforcer acts to protect the purpose of a purpose trust. A beneficiary enforces a trust because the beneficiary has a personal interest in the trust property. An enforcer, by contrast, protects the purpose the settlor chose to preserve. Delaware also gives the enforcer a role in the trust’s continued administration, including participation in certain nonjudicial settlement agreements and modifications.[16]
The flexibility does not end there. Delaware law allows a noncharitable purpose to be modified or terminated when the purpose becomes unlawful or when the trust would otherwise cease to serve a noncharitable purpose.[17] These provisions allow a trust to adapt while preserving the settlor’s underlying objectives and reflect Delaware’s broader commitment to freedom of disposition.[18]
Delaware’s noncharitable purpose trusts illustrate how far the concept of the trust has evolved beyond its traditional beneficiary-centered model. A trust can still transfer wealth from one generation to the next, but it can also preserve a business, sustain an institution, or carry a mission forward. By allowing the purpose itself to become the focus of the trust, while providing an enforcer to protect that purpose, Delaware gives settlors another way to determine not only who receives their property, but what they want it to accomplish.
[1] Rᴇsᴛᴀᴛᴇᴍᴇɴᴛ (Sᴇᴄᴏɴᴅ) ᴏғ Tʀᴜsᴛs § 2 (A.L.I. 1959); Rᴇsᴛᴀᴛᴇᴍᴇɴᴛ (Tʜɪʀᴅ) ᴏғ Tʀᴜsᴛs § 2 (A.L.I. 2003).
[2] Rᴇsᴛᴀᴛᴇᴍᴇɴᴛ (Tʜɪʀᴅ) ᴏғ Tʀᴜsᴛs § 94 (A.L.I. 2012).
[3] Rᴇsᴛᴀᴛᴇᴍᴇɴᴛ (Sᴇᴄᴏɴᴅ) ᴏғ Tʀᴜsᴛs § 124 (A.L.I. 1959); Rᴇsᴛᴀᴛᴇᴍᴇɴᴛ (Tʜɪʀᴅ) ᴏғ Tʀᴜsᴛs § 94(2) (A.L.I. 2012).
[4] Dᴇʟ. Cᴏᴅᴇ Aɴɴ. tit. 12, § 3556 (2026).
[5] Kimberly McKinnon, Daniel Hayward & Jennifer Kelleher, The Rich Tapestry of Delaware Trusts, Del. Banker, Fall 2025, at 12, https://www.debankers.com/assets/Delaware_BankerVol21No4.pdf (discussing common uses of Delaware purpose trusts).
[6] Dᴇʟ. Cᴏᴅᴇ Aɴɴ. tit. 25, § 503(a)–(b) (2026) (generally limiting trusts holding real property to 110 years, subject to specified exceptions).
[7] Dᴇʟ. Cᴏᴅᴇ Aɴɴ. tit. 12, §§ 3551–3555 (2026).
[8] Susan N. Gary, The Need for a New Type of Purpose Trust, the Stewardship Trust, 45 ACTEC L.J. 37, 41–42 (2019).
[9] See Vincent C. Thomas, Justin P. Duda & Travis G. Maurer, Independence with a Purpose: Facebook’s Creative Use of Delaware’s Purpose Trust Statute to Establish Independent Oversight, Bus. L. Today (Dec. 17, 2019), https://businesslawtoday.org/2019/12/independence-purpose-facebooks-creative-use-delawares-purpose-trust-statute-establish-independent-oversight (discussing Facebook’s use of Delaware’s purpose trust statute to establish an independent Oversight Board).
[10] Patagonia Works, Patagonia’s Next Chapter: Earth Is Now Our Only Shareholder (Sept. 14, 2022), https://www.patagoniaworks.com/press/2022/9/14/patagonias-next-chapter-earth-is-now-our-only-shareholder (describing the transfer of Patagonia’s ownership to the Patagonia Purpose Trust and the Holdfast Collective).
[11] Id.
[12] Dᴇʟ. Cᴏᴅᴇ Aɴɴ. tit. 12,§ 3556(3) (2026).
[13] Id.
[14] Id. § 3556(5).
[15] Id. § 3339.
[16] Dᴇʟ. Cᴏᴅᴇ Aɴɴ. tit. 12, § 3556(8) (2026).
[17] Id. §§ 3556, 3541.
[18] Id. § 3303(a).
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