TRUSTS: CREATION, TYPES, AND CHARACTERISTICS Definition of a Trust A trust is a legal device that...
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Transcript of TRUSTS: CREATION, TYPES, AND CHARACTERISTICS Definition of a Trust A trust is a legal device that...
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TRUSTS: CREATION, TYPES, AND CHARACTERISTICS
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Definition of a Trust
A trust is a legal device that separates the benefits of property ownership from the burdens of property ownership
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Basic Paradigm of a Trust
Trustee
ALife Estate
BRemainder
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Trust as Gift Intent Delivery Acceptance
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THREE REQUIREMENTS FOR EVERY TRUST
Settlor Trustee One or more beneficiaries
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SETTLOR Declaration of trust Transfer in trust 18 years or older
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TRUSTEE 18 years or older Bank or trust company with trust
powers Other institutions granted trust
powers by statute
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Basic Paradigm of a Trust
ALife Estate R B
Remainder
ATrustee
DTrustee
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Basic Paridigm of a Trust
ALife Estate R
ATrustee
DTrustee
B sells remainder to A
ARemainder
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Basic Paradigm of a Trust
ALife Estate R A
Remainder
ATrustee
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Trust Will Not Fail for Want of A Trustee
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Beneficiaries Income beneficiaries Beneficiaries of Corpus Mixed beneficiaries
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Given a choice between being a trustee or a beneficiary, be a beneficiary
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Jimenez v. Lee What are the facts of this case? Why might father prefer to be a
custodian, rather than a trustee? What does the court hold?
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Language of Intent
Use of word “trust” Precatory language
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Hebrew University v. Nye What are the facts of this case? In Hebrew #1, why does the court
find the trust fails In Hebrew #2, why does the court
find there was a gift Court was willing to fudge the gift
rules, but not the trust rules. Why?
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Unthank v. Rippstein What are the facts of this case? What does the court hold? Review the words in the letter. What
argument could you make that: He did intend letter to be a holographic
will? He intended to declare a trust
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Equitable Remedy Trusts Resulting Trusts
Reversions Purchase money resulting trusts
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Equitable Remedy Trusts Constructive Trusts
Fraud Mistake Undue influence Breach of a confidential relationship
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Necessity of Trust Property
Brainard v. Commissioner
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Intent to Create a Trust
Speelman v. Pascal
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Clark v. Campbell What did T’s will provide? What was the first argument to
sustain the provision? The second? How might T have accomplished the
goal today?
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In re Searight’s Estate What are the facts of this case? What does the court hold? Is the court correct? UPC 2-907
For up to 21 years or life of animal, whichever is shorter
Iowa Code 633.2105• Trust for care of animal living at settlor’s death is
valid. It terminates when no living animal is covered by its terms
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Hieble v. Hieble What are the facts of this case? What does the court hold? If mom’s purpose in making the
transfer was to avoid probate, what else might she have done?
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Olliffe v. Wells What are the facts of this case?
To A to distribute in such manner as in his discretion appears best calculated to carry out my wishes
Desire to create trust and not create beneficial interest in A
Since terms of trust undisclosed it is a void semisecret trust.
What if testator left her entire estate outright to A but A had promised to hold the property for the benefit of B? This is a “secret trust”
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Mandatory vs. Discretionary Trusts
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Discretionary Trusts
Marsman v. Nasca
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Marsman v. Nasca What are the facts of this case? What lessons do you learn from this
case? Why was the conveyance to Sally
and Richard upheld? Why isn’t Farr personally liable?
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Protective Trusts Discretionary trusts Spendthrift Trusts Support Trusts
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Creditors’ Rights
A creditor can have no greater rights in trust property than the creditor’sdebtor had in the property
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Spendthrift Trusts
Shelley v. Shelley
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US v. O’Shaughnessy
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Modification and Termination of Trusts
In re Trust of Stuchell
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Modification and Termination of Trusts
In re Estate of Brown
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Modification and Termination of Trusts
In re Estate of Brown
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Charitable Trusts
Shenandoah ValleyNational Bank v.
Taylor
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Charitable Trusts
Shenandoah ValleyNational Bank v.
Taylor
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Charitable Trusts
Shenandoah ValleyNational Bank v.
Taylor
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Charitable Trusts-Cy Pres
In re Neher
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Charitable Trusts-Cy Pres
In re Estate of Buck
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Charitable Trusts-Cy Pres
In re Wilson