Spouse can waive provisions of the will, take his/her statutory portion. Usually 1/3 if kids, 1/2 if no kids. Depends upon jurisdiction!

See: Sullivan v. Burkin

Gives T'ee broad generalized discretion in his fiduciary capacity to pay income/distribute principal to bennie. Need good faith. 

Reviewed only under abuse of discretion standard.

In a discretionary trust, this allows trustee to favor bennie over remaindermen, and vice versa, and discriminate among members of class.

Must be expressly granted, and it's non-delegable!

Trust established for charitable, public purposes. Cannot be family scholarship--that's a private interest. Can't be political either. 

If it's truly charitable, it's eligible for certain exceptions.

Who has standing to enforce a typical trust?

What about a charitable trust?

Normally, a non-charitable trust can only be enforced by C, D, sometimes A.

For a charitable trust, A.G.'s office can enforce, because standing given by statute.

Trusts to end slavery, help women's suffrage.

Slavery trust charitable, but suffrage political.

If charitable trust fails, can invoke Cy Pres if you find general charitable intent. 

Basically rewrite the trust for the benefit of some other charity to avoid a resulting trust.

Relief of Poverty

Advancement of Education

Advancement of Religion

Promotion of Health

Government/Municipal Purposes

Other Purposes Beneficial to Community.

1) Possession

2)Transfer of Title

3) Exoneration/Reimbursement

4) Compensation

5) Reliance on Instrument

Normally no, but if you are a trustee and a successor cannot be found, you may have to wait until one is found.

If you are the deceased personal representative, or have an interest in the trust you may become de facto trustee.

T'ee must administer the trust as a prudent person would, considering purpose of the trust.

Reasonable care, skill, caution standard.

Fiduciary Duty of Loyalty

(generally)

T'ee must act solely in the interest of the benies as to matters that directly and indirectly involve the trust property.

This is an active duty--all demands must be pressed!

If the T'ee engages in self-dealing (e.g. buying a trust asset), the transaction is void. We do not care about intent or good faith/fair price.

Transaction is constructive fraud, so court looks no further.

Joint and Several. If you tolerate the misconduct of a co-trustee, you are equally responsible.

But note, if you do not particpate in, approve, or conceal the breach, are not negligent in allowing it, then you are not liable for co-trustee's breach.

1) Cannot ratify or agree to the breach

2) Must monitor other T'ees.

3) Must order the breach to stop

4) Must take the other T'ees to court if they do not stop.

Asset custody

Record Keeping

Ministerial Tasks

Collect Dividends and Rents if Prudent

T'ee is personally liable for the errors of the agents.

T'ee cannot be reimbursed for their services from the T.

1) When it would have been a breach of duty if done by the T'ee himself.

2) T'ee directed/permitted, delegated non-delegable duty, did not use reasonable care to select agent, did not supervise, acquiesced, or did not redress the wrong done by agent.

  Incorporation by Reference  Requirements?

1.     the WILL must describe the writing with reasonable certainty;

2.    the writing must have existed at the time of execution;

3.    the writing must demonstrate intent to convey property;

4.    the writing must conform to the description in the will. 

Token funding of an IV trust is no longer necessary for pour-over provision in a will. 

Addresses the property requirement for a trust.

The Human Being is Gone!

Failure of a testamentary gift for want of a taker

Where statute provides an alternative taker.  It’s the legislature’s best guess as to testator's wishes.

In absence of Anti-Lapse statute, goes into residuary.

NB: If will provides for event of lapse (e.g. "To my children who survive me, in equal shares.” ) stattue NOT implicated.

Gives the power-holder (donee) the right while alive to direct the trustee to turn over the trust property at least to the holder or the holder's creditors. No fiduciary duty.

 FUNCTIONAL EQUIVALENT OF OWNERSHIP.

The specified piece of property is gone!

A specific devise can only be satisfied by that specific piece of property.  If it’s disposed of prior to testator’s death, the devisee is out of luck—i.e., there has been an ademption.  

NB: If the devise is general (a Rothko) and not specific (MY Rothko), then no ademption, and dip into estate to BUY a Rothko!)

Held:  Amending a trust after the execution of a

will with a pour-over provision is an act of independent legal significance that

should not effect the validity of the will.

Held: Anyone can use the vehicle of

a rev. trust as a tool for probate avoidance—i.e., upon death of settlor, property can pass to

remaindermen free of trust, and without going through the public probate process.

RAP Steps

State the Rule.

Identify the Contingent Interests.

Who are the lives in being when the contingent interest is created?

When, after the death of the worst-case-LIB does the interest finally vest?

Property in a self-settled, fully discretionary (or trust for support), irrevocable, inter

vivos trust is always reachable by creditors of the settlor-beneficiary.

To what extent can creditors reach the property in a self-settled, discretionary

trust?

Creditors can reach trust assets to the extent that

could have been reached by the settlor-bene. If fully discretionary as to income

and principal, creditors can reach all of it. If income-only, then only income.

Trustee is accountable to benes and remaindermen, generally. If charitable, to the public-at-large, by and through the AG.

Trustee’s duty to account includes filing periodic status reports—either with the court or

a designated party.

A Trustee has an affirmative duty to invest trust property prudently, with both the interests of

beneficiaries and remaindermen in mind.

[reasonable income (Cs) and reasonable growth of principal (Ds)]

Classic case that developed prudent man rule.

"Do what you will, the capital is at hazard."

If Trustee strikes appropriate balance, he will be judged by that conduct, not results.

“Displaces 200 years of tried-and-true law.”

Trustee’s portfolio should be looked at as a whole.

Replaces prudent “man” with prudent “investor”—potentially elevating the standard.

Virtually requires diversification—unless, under the circ., it is not prudent to do so.

With a GENERAL POA, the holder has the option to appoint property outright OR to

appoint it in further trust—either by adding new Ds or appointing to a new Trustee.

(§ 8.1.2)

But if the attempt to appoint in further trust fails—say, for RAP reasons—the

Doctrine of Capture causes the property to revert to the estate of the holder of the

POA.