§3. So far I have considered the bequest simply as having the effect of dividing the property among children---or other persons---who receive it in complete ownership. Suppose, however, that a child or grandchild is an infant at the parents' death; it is obvious that the property must be given to some one to hold in trust for it. We thus introduce the notion of fiduciary as distinct from beneficiary ownership; in which the management of property is separated from the enjoyment of it. The necessity for such trusts in the case of young children is manifest; but when we consider the expediency of allowing fiduciary ownership to be extended beyond what is required for this purpose---as (e.g.) by permitting parents to pass over children and bequeath property to be held in trust for descendants yet unborn---the conclusion, from our present point of view, is more doubtful: On the one hand---besides the general argument for freedom of bequest---there would in some cases be a difficulty in arranging the succession to property in accordance with the testator's view of the needs and deserts of his descendants, unless such remote trusts were allowed. On the other hand, fiduciary ownership involves the drawback that a trustee cannot be expected to be as much interested in the management of property as an ordinary owner would be: while, if he is controlled by conditions imposed by the testator, there is the further objection that the testator's foresight of the future is limited, so that after his death an arrangement manifestly undesirable may be legally unalterable. This latter objection applies with especial force to property left to public objects: if the testator's design is carried out it may become worse than useless, owing to change of circumstances, even when it was originally well conceived.
Similar questions arise as to the expediency of allowing ownership that is not fiduciary, but limited in time or restricted by conditions, to be created by bequests,---or by any legal act that continues to take effect after the death of the person imposing the limitations or conditions. E.g. when a man thus becomes an owner of land for life only, he is likely not to have sufficient inducement to apply capital in improving the land; and the inalienability necessarily involved in such life-ownership may keep the land in the hands of a person who has neither skill nor capital to deal with it in the best way.
These and similar difficulties are only particular cases of the general theoretical difficulty that besets the individualistic system---even when interpreted in a completely utilitarian sense---if it is taken to include freedom of bequest. Granting that men in general will extract most satisfaction out of their wealth for themselves, if they are allowed to choose freely the manner of spending it, it obviously does not follow that they will render it most productive of utility for those who are to come after them if they are allowed to bequeath it under any conditions that they choose. On the contrary, it rather follows from the fundamental assumption of individualism, that any such posthumous restraint on the use of bequeathed wealth will tend to make it less useful to the living, as it will interfere with their freedom in dealing with it. Individualism, in short, is in a dilemma. The free play of self-interest can only be supposed to lead to a generally advantageous employment of wealth in old age, if we assume that the old are keenly interested in the utilities that their wealth may furnish to those who succeed them: but if they have this keen interest they will probably wish to regulate the future employment of their wealth; while, again, in proportion as they attempt this regulation by testament, they will diminish the freedom of their successors in dealing with the wealth that they bequeath; and therefore, according to the fundamental assumption of individualism, will tend to diminish the utility of this wealth to those successors. Of this difficulty there is, I think, no general theoretical solution: it can only be reduced by some practical compromise. Thus the creation of fiduciary ownership for the benefit of young children may be limited by requiring the children to be living when the bequest takes effect, or born within a certain period after that date. Again, the general disadvantages of fiduciary management, and of management by a limited owner---which have been specially noted in the case of land---may be minimised by securing to the trustee or life-owner an inalienable right of selling the land or other property, provided he invests the proceeds of the sale in securities of a certain class. Finally, in the case of trusts for public uses---usually of a permanent kind---it is desirable that, the government should have a general power and duty of invalidating useless or mischievous bequests; and of revising and modifying the employment of the funds bequeathed, after a certain interval of time or after any important change of circumstances.
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