A type of trust that comes into existence “constructively”- i.e., by a court’s decision holding that from amongst the parties to a contract/ agreement only one party will have to act as a trustee for, and on behalf of, the others as to any contractual dealings or interactions (hence, it is also labeled: common intention trust). In which case, the parties agree to apply beneficial ownership without following the formalities/ procedures (such as execution of a written declaration of trust), while one of the parties is expected to incur damages in reliance on the agreement. Constructive trust is one of many other ways (e.g., declaration of interests) that give rise to a beneficial interest.

Under case law, a constructive trust can be established, subject to a set of conditions including common intention to install a non-owner as beneficial owner (holding a beneficial interest in the assets/ property), and evidence of express discussions that would give rise to the common intention, etc.