Private Trusts Flashcards
Characteristics
Fiduciary relationship with respect to property
Trustee- holds the legal title
Beneficiary- equitable rights
Settlor- creator of the trust
Biggest issue - intent to create trust
NO CONSIDERATION IS REQUIRED
Intent
written, spoken, conduct
intent communicated to benny- not required
Precatory language
hope, wish, mere suggestion- no trust unless:
definite and precise directions; addressed to fiduciary; resulting in an unnatural disposition of property; extrinsic evidence show the settlor previously supported the benny
passive trust
trustee has no duties- void and bennies take legal title
removal of trustee
breach, old age, drunkenness, conflict of interest
merger
sole trustee and sole benny-> same person-> title merges and the trust terminates
Notice to benny
no notice required but acceptance is required. Acceptance can come after the valid trust is created
Unascertained Bennies
Bennies may be definite yet no ascertained (unborn)- they must be ascertainable when their interests come into enjoyment
Class gifts
must be reasonably definite
Invalid trusts
illegal; performance requires criminal or tortious act; contrary to public policy
Against public policy if: illegal condition is a condition subsequent- condition is invalidated but trust remains
If illegal condition is a condition precedent usually valid unless the settlor’s wish would void the benny’s interest all together
Take Away for creation of a trust (ITTDV)
Intent; Trustee; Trust property; Definite Benny; Valid purpose
Inter vivos transfer
Present declaration or transfer required
Writing not required unless land - statute of frauds
Parol evidence allowed
Constructive trusts
equitable remedy for one that has been wrongfully denied of rights to trust
All that matters is the testator relied on the promise of the that the trust would be held for the intended benny
Secret trust
absolute gift in will made in reliance on benny’s promise to hold the property in trust for another
Extrinsic evidence is allowed
Constructive trust results for intended benny
Semi- secret-
gift in will to a person “in trust” but doesn’t name trust benny
Extrinsic evidence is not allowed
“trustee” holds on resulting trust for testator’s legatees or heirs
