Creation of Valid Trust:

Question 1

Requirements of a Valid Trust

Answer 1

(1) Property
(2) Beneficiary (“B”)
(3) Trustee (“T”)
(4) Intent
(5) Creation
(6) Valid Legal Purpose

Question 2

What if No Trustee?

Answer 2

Not fatal if absent. Court will appoint.

Question 3

Intent

Answer 3

Must be present manifestation. Precatory words not enough.

Question 4

Valid Legal Purpose?

Answer 4

If illegal at creation → excise bad part.

If impossible → invalidate trust at inception and settlor remains owner or allow trustee to keep property.

If illegal condition → trust provided to B free of condition.

If illegal after creation → decree resulting trust.

Question 5

Alienation

Answer 5

Voluntary - Allow B to sell or transfer property interest.

Involuntary: Creditors.