Legal v Beneficial Ownership This is a very simple concept, but very difficult for it to sink in. There are 2 different forms of ownership of property under Australian Law (and British derived law in general). Property here means land (i.e. houses) and other things. Legal ownership refers to who has title to the property. This includes names on bank accounts, car registration papers and land titles. Usually the legal owner is the absolute owner of the property, but not always. It is possible that the legal ownership differs from the beneficial ownership. In these situations a trust like relationship exists. A beneficial ownership interest is an interest other than a legal interest. An example that is easy to understand is a mother opening a bank account for a 2 year old child. The mother has legal title, but not the beneficial ownership of the account or its money. Trust relationships can be of 2 general varieties. Express trusts are trusts which are expressly intended to operate. They are usually evidenced by writing – a deed. Non express trusts are trusts which arise because of the situation. There may be no intention by the parties that a trust operates, but a trust like relationship can exist and be declared as such by a court. An example is where Spouse A buys a house in the name of Spouse B but the funds used to pay for the house come from Spouse A. Spouse B would have legal title, but Spouse B could be deemed the beneficial owner of the house. There would be no trust deed and no intention of the parties to create a trust, but the trust relationship exists because of the circumstances. This has important implications in asset protection.