MEE - Bar Exam Drills Flashcards
Creation of Valid Trust:
To create a trust, the settlor must have the following:
(1) present intent to create the trust
(2) deliver assets to fund the trust
(3) have ascertainable beneficiaries
MEE EXAMPLE: “All the beneficiaries are alive at the time of the trust instrument and were ascertainable at the time the trust was created.”
(4) a trustee
(5) give active duties to the trustee
(6) the trust must have a proper purpose
Any purpose that is not illegal is proper. Under Trust Code, trusts are assumed to be revocable unless stated otherwise.
MEE EXAMPLE: “Therefore, (whoever’s) trust was not validly created since the delivery of assets to fund the trust was not simultaneous with the present intent to create the trust. However, if the ____ rendered the later delivery acceptable, then the trust was created upon delivery of the (whatever item it is).”
Revoking a Trust:
Under the Uniform Trust Code, trusts are assumed to be revocable. They may be revoked similarly to a will. For example, a trust can be revoked by physically destroying the physical trust/ will itself, crossing out the words and writing revoked, burning, tearing up, etc.
Anything that indicates on the face of the trust that the settlor had the present intent to revoke the trust and took actions upon that intent satisfies the rule for revocation.
Implied or Express Trust:
Trusts may be expressed or implied. Under the statute of frauds, wills and trust must be created by a signed writing.
However, an implied trust can be created when the property is given to be held in trust for another.
Charitable Trust:
Charitable trust must not have any ascertainable beneficiaries and be for a charitable purpose.
Charitable purposes can be the following:
(a) gifts to organizations for charitable purposes
(b) to help the general community
(c) to help local charitable organizations
Since the trusts beneficiaries are ascertainable, it must follow RAP. However, it is impossible to tell which political candidates interest will vest in the interest within 21 years and there is no life in being at the time in which the interest is to be gauged on.