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FL Bar Exam Flashcards- MBE > Trusts > Flashcards

Trusts Flashcards

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MBE flashcards
1
Q

Creation of Valid Trust

A

(1) intent to create (2) trust property (3) beneficiares (4) trustee (5) a valid trust prupose

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2
Q

Settlor

A

must have capacity to convey

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3
Q

Irrevocable trust

A

settlor must have legal power to convey trust property

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4
Q

Undue Influence

A

contestants must establish that the product of the influence “but for” influence

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5
Q

Intent

A

must have definite terms

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6
Q

precatory language

A

does not create a trust

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7
Q

Trustee

A

trust will not due to death, removal, resignation of the trustee

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8
Q

Duty to Administer

A

in good faith and prudent manner

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9
Q

Duty of Loyalty

A

no self dealing

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10
Q

Specific Self-Dealing Rules

A

(1) cannot buy or sell trust assets (2) cannot buy assets from one trust to another (3) cannot borrow trust funds or make loans to trust

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11
Q

Duty of Impartiality

A

trustee must act for the benefit of the beneficiaries, if over 1 B then act impartially

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12
Q

Duty to Separate and Earmark Property

A

trust assets must be physically separated from trust’s personal assets of other trusts

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13
Q

Duty to Perform Personally

A

trustee must perform functions that a RPP wouldn’t delegate

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14
Q

Delegation of Investment and Management

A

OK if reasonable care, skill and caution in (1) selecting the agent (2) establishing the scope and terms of the delegation AND (3) monitors the agents performance and complies with terms

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15
Q

Duty to Preserve Trust Property and Make it Produce

A

(1) collect all claims due to trust (2) lease land and manage it (3) record recordable documents (4) invest trust funds

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16
Q

Remedy to Beneficiary for Violation

A

(1) b can ratify to accept improper conduct (2) sue for full surcharge or amount lost to trust

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17
Q

Removal of Trustee

A

court may remove if actions are detrimental to the interest of the B.

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18
Q

Commission of serious breach of trust

A

grounds for removal

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19
Q

Incapacity

A

grounds for removal

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20
Q

Unfitness/Drunkenness, old age, practical inability

A

grounds for removal

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21
Q

Refusal to post Bond of account

A

grounds for removal

22
Q

Existence of a significant conflict of interest

A

grounds for removal

23
Q

Trustee insolvency

A

grounds for removal

24
Q

Extreme friction between trustee and beneficiaries

A

grounds for removal if interfere’s with proper administration of trust

25
Q

Prudent Investor Rule

A

standard when determining priority of investments. Basic duty to invest prudently. Examine probably income and safety of preservation. Must diversify investments

26
Q

Investment performance

A

measured by OVERALL RETURN

27
Q

Trust property

A

where no trust property, trust fails.

28
Q

Real Property trsut

A

must be in writing

29
Q

Trust of tangle property

A

need not be in writing

30
Q

Promise for future trust

A

must be supported by consideration, can arise when property is acquired w/o manifestation of intent

31
Q

Beneficiaries

A

trust requires (1) definite (2) ascertainable beneficiaries UNLESS charitable or honorary trusts

32
Q

Timing if Beneficiary Identity

A

not at time trust is created but when interest vests

33
Q

Purpose of a Trust

A

trust is invalid if purpose is (1) illegal (2) contrary to public policy (3) impossible (4) intended to defraud creditor or (5) based on illegal consideration

34
Q

FL RAPS

A

(1) must vest within 21 years after death of life in being OR (2) vests or terminates w/n 360 years

35
Q

Spendthrift Trusts

A

B cannot transfer interest and creditors are precluded from reaching it to satisfy claims. When trust property is distributed then subject to creditor’s reach

36
Q

Exception to Spendthrift Trusts

A

Cannot be used to shield from (1) creditors where B is settlor (2) claims for support, alimony, and services to protect his interest (3) claims by the government

37
Q

Charitable Trusts

A

(1) identifiable beneficiaries (2) may be perpetual (3) cypress doctrine applies (4) RAPS DOES NOT APPLY

38
Q

Charitable Trust Purpse

A

must benefit the public

39
Q

Cy Pres Doctrine

A

applies when cannot enforce charitable trust. if settlor has general charitable purpose vs specific, court will select alt. charity to be “as near as possible” to settlor’s intent

40
Q

Support Trust

A

provides for B’’s support: (1) housing, (2) food (3) tuition. No right for luxuries. Can be mandatory or discretionary

41
Q

Discretionary Trust

A

grants discretion to make distributions. B cannot compel distribution. Court only orders if ABUSE.

42
Q

Totten Trust

A

bank account where trustee cakes withdrawals during and deposits during life. B has no right until T dies

43
Q

Pour Over Gift from Will to Trust

A

(1) trust must be in existence before or concurrent with will (2) trust may be amendable or revocable (3) gift is valid even though trust unfunded during settlor’s lifetime

44
Q

Homestead Property

A

cannot be made into a gift or transfer title by deed unless settlor is joined by his spouse

45
Q

Automatic Termination of Trust

A

occurs when (1) end date specified (2) purpose is accomplished (3) unlawful (4) contrary to public policy (5) becomes impossible

46
Q

Can a Trust be amended or revoke?

A

Yes unless it expressly states its irrevocable

47
Q

Continuation of trust uneconomical (under 50K)

A

grounds for termination

48
Q

When is modiciation allowed?

A

(1) consistent w/purpose (2) best interest of B (3) modification achieves tax objectives (4) reformation needed to correct a mistake

49
Q

Resulting Trust

A

express trust terminates and and settlor is B of resulting trust. conveyance of property under express trust and (1) trust is void OR (2) B is dead and can’t be located.

50
Q

Resulting Trust will not be Implied when

A

(1) trust says what to do when trust fails (2) settle was given consideration for original transfer in trust (3) trust is illegal purpose (4) Cy Press is applicable

51
Q

Constructive Trusts

A

prevents unjust enrichment. trustee’s only duty is to give trust property to whoever should have had it BUT FOR wrongful conduct. BOP is clear and convicing

FL Bar Exam Flashcards- MBE (20 decks)

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