Creditors' claims and spendthift trusts

Question 1

A beneficiary can transfer or assign her interest in a trust UNLESS the trust is a..

Answer 1

spendthrift trust

Question 2

Spendthrift clauses are valid except as to.. (4 things)

Answer 2

1) contracts for necessaries (medical, food, rent)
2) child support obligations
3) any interest retained by settlor- including revocable trusts (settlor is treated as “owner” for creditors’ rights purposes)
4) federal tax liens

Question 3

Creditor vs. settlor: as to interests irrevocably transferred to third parties, creditor can/cannot reach?

exception

Answer 3

cannot reach b/c settlor doesn’t own anymore

exception: fraudulent conveyance (transfer made with intent to defeat, delay or defraud creditors)