Beneficial Entitlement Flashcards
What is a Fixed Trust?
A Trust wherein:
- Beneficial Entitlements are Fixed; and
- Objects have Vested Equitable Title in the Trust Property.
What is a Successive Interest Trust?
A Trust wherein:
- Some Beneficiaries are entitled to Income; whereas
- Other Beneficiaries are entitled to Capital.
What is a Discretionary Trust?
A Trust wherein:
- Distribution of Beneficial Entitlements is at the Trustee’s Discretion; and
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Objects do not have Vested Equitable Title in the Trust Propery; however
- They are entitled to ensure the Trustee acts properly and within a reasonable time.
What is a Power of Appointment?
- A right to choose who, from within a specified Class of Objects, receives Property.
- The Empowered Person is the Donee.
Powers are not Trusts, but Trusts usually include Powers.
How does the Use of a Power of Appointment differ based on the Donee?
Trustee:
- The Power is a Fiduciary one, and the Trustee must at least periodically consider exercising it.
Non-Trustee:
- The Power is not a Fiduciary one, and the Person is not required to consider exercising it.
Powers given to Non-Trustees are called Personal Powers.
What are the Rights of an Object of a Power of Appointment?
To ensure the Power is exercised properly, if ever it is used.
What is a Gift Over Clause?
A Clause in a Power of Appointment that determines what should be done with the Property if the Power is never used.
What is a Vested Interest?
A current Right to Property.
What are the Two Types of Vested Interests?
Vested in Interest:
- A current Right to future enjoyment of Property.
Vested in Possession:
- A current Right to current enjoyment of Property.
Vested Beneficiaries enjoy Rights to Income and Capital.
What is a Contingent Interest?
A Right to Property conditional upon the occurrence of an uncertain future event, after which it Vests.
Contingent Beneficiaries do not enjoy Rights to Income and Capital.
