1) Settlor makes a signed writing

2) Delivery of Legal Title

3) To a trustee (needs not be identified)

4) Who holds legal title

5) For benefit of a beneficiary

6) With intent to create a trust

7) For a legal purpose

*Trustee needs to be given income.  

Bank account with the depositior's name:

"As Trustee for" a named beneficiary.  Transfers at death, no magic words.

Revoked by:

1) No money in account.

2) Notarized revocation to bank. 

3) Revoke in will.

4) Death of beneficiary.

Setup by in settlor's will.  

Can testamentary gift to an existing revocable trust

-avoids will formalities in the trust

- can be sent to any trust, not just settlor's

-even if trust unfunded or only partially

Indefinite beneficiaries and a rzbly large group:

1) No named persons (masses exception)

2) For a charitable purpose (generally)

3) Perpetual (not subject to RAP)

4) Cy Pres-ct can reform to reflect Settlor's purpose

5) AG has duty of representing interests

Avoids guardianship, avoids a trust, $12,000 tax free.

Must be made to a custodian and specify duties under the UTMA to create:

1) hold, manage and invest property-rzbly prudent person standard

2) Pay to minor for necessities as sees fit

3) Pay residual at 21

Minor holds legal title

Only when the objectives of the trust are not being fulfilled or impaired by the trust w/o modification.

1) Figure out primary intent of Settlor

2) Look at specific directions and modify whatever is impeding fulfillment of purpose.

RULE: trusts are irrevocable and unamendable unless reserved expressly in the instrument.

Except: A settlor can terminate an irrevocable trust if all beneficiaries in being consent.  

*No consent required if beneficiaries are next of kin or heirs because not considered a beneficial interest.

Keeps creditors at bay until distributed or entitled to it.  

Must be expressed in the instrument- "No beneficiary can assign, nor shall such interest be reachable by creditors." 

If settlor retains any interest, his creditors can still go after it.  

An equitable remedy designed to disgorge unjust enrichment that results from wrongful conduct, like disrupting a will signing.

No honorary trusts (lacks human- except charitable)

Where 3rd party alleges that grantee orally promised grantor that land would be held in trust for someone else.  

RULE: ORAL TRUST IGNORED

Unless, clear and convincing evidence of fraud in the inducement at time agreement entered into- grantee had no intent to follow through on oral promise, or where special relationship exists between grantor and grantee.  

Sell, lease, repair ordinarily, handle claims, anything else not prohibited.  

Duty to segregate personal assets from trust.

Duty to earmark trust assets by titling them accordingly

NO Self Dealing:

1) Cannot sell trust assets to self,

2) Borrow trust funds

3) Fair interest % on loans to trust

4) No profit except rzbl fees

5) Corp trustee cannot buy own stock

If continues business without court permission, liable for all losses.  

1) Sue to remove

2) Ratify transaction and waive breach

3) Sue for loss

Self-dealing gets strict liability- good faith and reasonable is not a defense.  

3rd party Purchaser- BFP for value and w/o notice cannot be sued by a beneficiary.  

Look at how signed- if trustee signed on behalf of trust, no personal liability.  Personally- personal liability.  

Trustee can get reimbursed if:

1) K was within powers of trustee, and

2) Was acting in course of proper admin of trust

Torts: Personally liable for all torts and torts of employees, agents etc.  

Should buy insurance and charge trust costs.  

Reimbursement from trust if:

1) Acting within trustee's powers, and

2) Not personally at fault.