Also known as:Massachusetts business trusts · Mass. business trust · Massachusetts trust · business trust
Written by attorneys · grounded in primary & secondary sources — see below
A business organization formed under Massachusetts law by a declaration of trust that confers upon trustees powers to conduct a commercial enterprise for the benefit of beneficiaries. The structure is treated as a separate legal entity equivalent to a corporation for many statutory purposes, including classification as a person and registered organization under uniform commercial laws.
Sources & Authorities
How it applies
Common Examples
3
Business Trust Avoids Wrongful Dissociation Liability
Marathon Logistics, a Massachusetts business trust serving as a limited partner in a multi-year construction venture, votes to dissolve its operations midway through the project. Because the entity qualifies as a business trust rather than a standard corporation, its termination does not trigger the statutory category for wrongful dissociation that applies to other non-individual entities. The remaining partners therefore cannot recover damages from Marathon Logistics under the rule governing term partnerships.
Partnership Dissociation Rule Skips Business Trust
Maxwell Manufacturing, organized as a Massachusetts business trust, joins a fixed-term research partnership and later dissolves after its board approves termination. The dissolution causes dissociation before the undertaking ends, yet the business-trust exclusion prevents the act from qualifying as wrongful under the applicable partnership statute. The other partners bear the resulting project delays without a damages claim against Maxwell Manufacturing.
Put it into practice
Test Yourself
7
Practice Questions2
· 9 primary sources
Select any source to read its text and confirm it supports the definition.
Uniform Acts
Model Codes
Hornbooks
Study Supplements
Business Trust Asserts Corporate Speech Rights
Mirage Hotels, formed as a Massachusetts business trust, funds a public campaign opposing a ballot measure that would restrict hotel development. State officials attempt to bar the expenditure on the ground that the trust lacks constitutional protections afforded to corporations. The trust successfully invokes the same First Amendment safeguards recognized for business entities, allowing the campaign to proceed.
First National Bank of Boston v. Bellotti435 U.S. 765 (1978)
Common questions
Frequently Asked
3
How does a Massachusetts business trust differ from an ordinary trust in commercial contexts?+
A Massachusetts business trust is created under a state business trust act to operate an ongoing commercial enterprise, whereas an ordinary trust typically holds and manages assets for passive beneficiaries without active business operations. The business trust form allows trustees to conduct profit-seeking activities and subjects the entity to entity-level rules under uniform acts.
Supporting sources
Why are business trusts carved out of the wrongful dissociation rules in partnership statutes?+
The uniform acts exclude business trusts from the category of entities whose willful dissolution automatically constitutes wrongful dissociation. This treatment recognizes that business trusts function like corporations and may dissolve for legitimate internal reasons without triggering the same liability that applies to ordinary corporate partners in term partnerships.
Supporting sources
Is a Massachusetts business trust considered a registered organization under the UCC?+
Yes. When a state statute governing business trusts requires the filing of an organic record, the business trust qualifies as a registered organization formed solely under the law of that single state.
Supporting sources
Trusts and Estates Trusts and Future InterestsTrusts · Types of trustsUBEIntermediate