Trusts

Question 1

Trust creation requirements

Answer 1

There must be a settlor who, intending to create a trust for a valid trust purpose, delivers the trust property to the trustee to hold for the benefit of one or more beneficiaries.

Question 2

Termination of a trust

Answer 2

Usually permitted if all the beneficiaries consent and the termination does not interfere with a material purpose of the trust

Question 3

Discretionary trust

Answer 3

Trustee is given discretion whether to apply or withhold payments of income or principal to a beneficiary. Beneficiary cannot interfere w/ trustee’s discretion unless he abuses his power.