Charitable and Honorary Trusts Flashcards
What are the three ways that a charitable trust differs from a private trust?
1) it must not benefit identifiable individuals;
2) it may be perpetual;
3) the cy pres doctrine applies
What are some examples of appropriate purposes for a charitable trust?
Relief of poverty; advancement of education or religion; promotion of health.
In general - must benefit the community
Is it necessary for a charitable trust to designate a particular beneficiary or even indicate a particular purpose?
Nope - can be left at discretion of trustee.
Who can bring suit to enforce a charitable trust?
The settlor, a qualified beneficiary, or the Attorney General
Does the Rule Against Perpetuities apply to charitable trusts?
No; nor does it apply to the shifting of the tinters from one charity to another on the occurrence of a stated condition
What is the cy pres doctrine?
When does a charitable trust that would result in a distribution of the trust property to non-charitable beneficiaries prevail over the court’s power to apply cy pres?
When a charitable purpose selected by the settlor is unlawful, impracticable, or wasteful, the court will select an alternative under the doctrine cy press, which means “as near as possible,” by ascertaining the settlor’s primary purpose
Only if: (1) the property is reverting back to the settlor, who is still alive; OR (2) fewer than 21 years have elapsed since the trust was created
What purpose do honorary trusts commonly serve?
Why is it called “honorary”?
For the benefit of pets or for the maintenance of burial places.
Because there is no human beneficiary to enforce it, the trustee is “on her honor” to carry out its terms, unless the court appoints someone to enforce it.
For how long are honorary trusts valid?
21 years, under the uniform trust code
