Lisa's-_Trusts

Lisa's-_Trusts - TRUSTS I. TYPES a. Testamentary Trust i....

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TRUSTS I. TYPES a. Testamentary Trust i. Created in a will 1. Court has to approve the trustee and has jurisdiction over the trust b. Intervivos Trust: i. O owns property and wants to create a trust in which X and Y will be trustees for the benefit of O’s spouse and children. ii. See requirements below c. Trustee has legal title and Beneficiaries have Equitable title II. REQUIREMENTS FOR CREATION a. INTENT manifested to create a trust relationship b. DELIVERY i. COMMON LAW & EPTL 1. Delivery of Legal Title : Legal title must pass to the trustees. a. Write out deed a deed of gift saying you transfer the property in the trust to the trustees and then deliver the deed of gift. b. O is trustee himself: Don’t need delivery since don’t need to transfer legal title. ii. NY EPTL 7-1.17 1. : Mere declaration of trust without change of form of ownership is insufficient. Every lifetime trust shall be in writing and notarized. There has to be at least one trustee that has his name signed and notarized. 2. Still need delivery unless O himself is the trustee. iii. Symbolic vs. Constructive Delivery c. ACCEPTANCE by a 3 rd party i. COMMON LAW 1. Acceptance of Trusteeship: When does Trustee Accept a trust? a. UTC 701(a)(2): a person designated as trustee accepts the trusteeship by accepting delivery of the trust property. b. Restatement of Trusts § 35: designated trustee may accept trusteeship either by words or by conduct. i. A trustee that does not accept, may decline. ii. It is a question of fact in each case whether the trustee has manifested an intention to accept or reject a trusteeship. iii. Merely protecting the property temporarily, until trustee is appointed does not indicate intention to accept. 2. Equity will not allow a trust to fail for want of a trustee ii. Hypo : O writes out a formal trust instrument creating a trust for the trust beneficiaries. He delivers the document and the assets to X, the designated trustee. X puts the assets and money in a safe deposit box and nothing else. O dies. Looks at O’s will and gives the assets to those in the will. Do the beneficiaries under the trust have any remedy here? 1. CL : If a trust was intended and there has been delivery, then title is in the intended trustee subject to the right of intended trustee to disclaim upon receiving notice. a. If X disclaims – Equity will not allow a trust to fail for want of a trustee – go to court and get a trustee appointed. i. Here, trust beneficiaries would take – trust doesn’t fail. 2. NY : Since O intended X to be trustee and not himself, X did not sign and accept the trust, so it is not a valid trust. Trust beneficiaries have no rights and the will beneficiaries take. a.
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Lisa's-_Trusts - TRUSTS I. TYPES a. Testamentary Trust i....

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