Trusts

Question 1

Under the Uniform Trust Code, as adopted by Virginia, a trustee may resign by giving _____ days’ notice to the settlor (if living), all co-trustees, and all qualified beneficiaries (other than beneficiaries under a revocable trust).

Answer 1

30 days.

Question 2

Under the Uniform Trust Code, as adopted by Virginia, a trust will fail if:

Answer 2

1) Its enforcement involves the commission of a crime.
2) Its enforcement involves the commission of a tort.
3) It was created with the intent to defeat the settlor’s creditors.
4) It was based on illegal consideration.

Question 3

This type of trust contains a provision prohibiting voluntary and involuntary transfer of a beneficiary’s interest, which might read as follows: “No interest of a beneficiary herein shall be transferrable by the beneficiary, nor shall such interest be reachable by the beneficiary’s creditors by garnishment, attachment, or other legal process.”

Answer 3

Spendthrift trust.

Question 4

Under the Uniform Trust Code, as adopted by Virginia, how is it possible to create a perpetual trust in Virginia?

Answer 4

The trust instrument states that the Rule Against Perpetuities does not apply to the trust.

Question 5

A trust in which the trustee’s discretionary power to make distributions is tied to a standard such as “support” or “maintenance” is called a ___________ trust.

Answer 5

Support trust.

Question 6

Generally, a trustee in trustee in Virginia can be removed on what grounds?

Answer 6

1) Commission of a serious breach of trust.
2) Unfitness, unwillingness, or persistent failure to administer the trust effectively.
3) Lack of cooperation among co-trustees that impairs the administration of the trust.

Question 7

True or False: The words “trust” and trustee” are required to create a trust in Virginia.

Answer 7

FALSE.

Question 8

Unlike most states, Virginia recognizes oral trusts with respect to both real and personal property as long as the existence and terms of the trust are established by what standard of proof?

Answer 8

Clear and convincing evidence.

Question 9

Under the Uniform Trust Code, as adopted by Virginia, examples of these kinds of trusts include trusts for maintenance of cemetery plots and trusts for pets:

Answer 9

Honorary trusts.

Question 10

If through the the passage of time or changed circumstances the stated charitable purposes of a trust can no longer be accomplished, or if the named charitable beneficiary goes out of existence, under what doctrine may a court redirect the trust to a purpose “as near as possible” to the charitable endeavor initially contemplated by the settlor?

Answer 10

Cy pres.