Trusts & Estates Flashcards
Incorporation by reference (will)
writing that exists at the time a will is executed may be incorporated by reference into the will. the will must describe the writing with sufficient particularity that it can be identified.
Duty of care (trust)
Under the common law, a trustee owes the beneficiaries the duty to act with care, skill, and prudence
Duty of loyalty (t)
the trustee owes trust beneficiaries a duty of loyalty and must administer trust exclusively in beneficiaries’ interests. Duty is breached when the trustee enters into transactions that involve a conflict of interest or self-dealing
Prudent Investor Act(t)
a trustee owes beneficiaries’ duty to invest prudently. Assessing considering: 1)distribution requirements of the trust, 2)general economic conditions, 3)role investment plays in relationship to the overall portfolio, and 4)trusts need for liquidity
Creation of Express trust
Settlor’s intent creates trust. 1)intention to create a trust, 2) res or subject matter, 3) a trustee, and 4)a beneficiary
Trust class gift: substitute gift
when a remainder class gift is bequeathed to a class composed of children and a child dies before the possessory event, a substitute gift is created in the descendants of the dead kid; words of survivorship do not affect
Trusts power to modify(amend)
if the settlor has the power to revoke, that retained power includes the power to modify as well
Trusts equitable deviation doctrine: UTC
an administrative provision of the trust may be modified if”because of circumstances not anticipated by the settlor, modification or termination will further the purposes of the trust”
revocation of will
a will may be revoked by execution of a new will or by a physical act such as cancellation or other writings on the will if the testator performs the physical act with the intent to revoke
ademption common law
Under common law, an ademption occurs when the subject matter of a specific devise is not found in the probate estate at the time of the testator’s death.
ademption intent test
a beneficiary of specifically devised property is entitled to substitute property that was owned by the testator at their death if beneficiary proves testator intended beneficiary to take substitute property
Testamentary trust
a testamentary bequest to the trustee of an inter vivos trust established by the testator during life is valid if trust is in writing, in the will, and the instrument was done before, along with, or after the will. It is amendable or revocable prior to settlor’s death and amendment applies to probate assets poured into the trust at settlor’s death pursuant to will
