Creating Trusts Flashcards

1
Q

6 elements for creating a valid trust

A

(1) settlor intent
(2) delivery of trust property
(3) ascertainable beneficiary
(4) trustee
(5) active duties on trustee
(6) proper trust purpose

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Settlor intent element

A

Settlor with requisite capacity who expresses a present intent to create a trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Delivery element

A

Delivery of SPECIFIC trust property:

● Must be delivered to trustee with intent to do it right now (not in future)
● Must be some certainty over what is the trust property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Beneficiary element

A

An ASCERTAINABLE beneficiary:

● Must be determinable when the trust is to be distributed
● Need some objective standard (reasonable basis) to identify the beneficiaries

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Proper trust purpose element

A

A trust can be created for any purpose except those that are illegal, fraudulent, or against public policy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Types of trusts

A

(1) inter vivos trust
(2) testamentary trust
(3) totten trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Inter vivos trust

A

Created during the settlor’s lifetime

Trust property must be placed into the trust

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Testamentary trust

A

Created by testator’s valid will

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Pour over provision

A

“Pour over” provision in testamentary trusts = directs the transfer of the decedent’s property into a trust established by either the testator during his lifetime or by another person

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Totten trust

A

An arrangement with a bank that allows the depositor to open a bank account in the depositor’s own name, as trustee for other parties

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Beneficiary entitlement in totten trust

A

The only right the beneficiary has is to take whatever is left in the account when the depositor dies (if the beneficiary is still alive)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Duration of private trusts

A

All private, non-charitable trusts must comply with the Rule Against Perpetuities (RAP)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

RAP modification

A

Wait-and-See Approach: The court’s determination of whether the rule has been violated depends upon what actually happens rather than what might happen

How well did you know this?
1
Not at all
2
3
4
5
Perfectly