Trusts

Question 1

What is the effect of intent to create a trust without delivery of assets to the trustee?

Answer 1

No legal effect (no trust created). Need delivery of assets to trustee

Question 2

Is the language “provided she does not marry” okay?

Answer 2

No, a total restraint on marriage is void

Question 3

Can a trustee give a lease that extends beyond the life of a trust?

Answer 3

Yes. Can do whatever a fee simple owner can do with his property

Question 4

One form of a spendthrift clause?

Answer 4

“S’s interest shall not be transferable or subject to creditor’s claims”

Question 5

What is needed for a trust relating to real property?

Answer 5

A deed conveying title to the trustee

Question 6

Who does a trustee owe a duty to in a revocable trust?

Answer 6

The settlor

Question 7

What happens if settlor told trustee not to diversify in a revocable trust?

Answer 7

Trustee doesn’t have to diversify because just owe a duty to the settlor and that’s what the settlor told the trustee to do

Question 8

If an intervivos trust has testamentary aspects, does it need to comply with statute of Wills?

Answer 8

Yes, otherwise the trust is invalid

Question 9

Can the beneficiaries remove a trustee?

Answer 9

No, unless they have been granted that power in the trust document

Question 10

One way to revoke a totten trust?

Answer 10

Withdrawing the funds (even if for personal benefit)

Question 11

What must happen for a totten trust beneficiary get the money in the account?

Answer 11

Must survive the depositor-trustee

otherwise the trust automatically terminates and would pass through depositor’s estate

Question 12

What damages can a person get if trustee didn’t purchase the stocks directed?

Answer 12

The dividends beneficiaries would have gotten and the increase in the stock value

Question 13

What is “to my friend as trustee to distribute the trust income for purposes that I have privately communicated to him”

Answer 13

Semi-secret trust

Trust fails and a resulting trust would be created

Question 14

If settlor dies, who can terminate an irrevocable trust?

Answer 14

Trustees and beneficiaries by unanimous agreement

Question 15

If trustee does something improper, but is able to recoup the money through another improper way, what can the trustee be liable for personally?

Answer 15

All the resulting loss, doesn’t matter if recouped some

Question 16

What is required for a pour over fift from a will to an intervivos trust?

Answer 16

Trust must have been executed prior to or contemporaneously with the will.

Question 17

Is an exculpatory provision in a business trust valid?

Answer 17

Yes

Question 18

What is an exculpatory clause?

Answer 18

Removing personal liability