Creation of an Express Trust Flashcards
What is an express trust?
In an express trust,
1. a settlor transfers legal title in specific property, called the res,
2.to a trustee,
- for the benefit of one or more ascertainable beneficiaries who hold equitable title to the res.
What are the elements needed to create an express (inter vivos) trust?
For an express trust to arise, the settlor must:
have capacity to create a trust;
manifest intent to create a trust; and
transfer an interest in specific property to a trustee, who has duties regarding the trust; AND
the trust itself must have a valid and ascertainable purpose
and ascertainable beneficiaries
(must comply with relevant legal formalities)
What is required for a settlor to have the capacity to create a trust?
The settlor must generally understand, at least in a broad way:
the nature and extent of her property;
her heirs and beneficiaries;
the significance of what she’s doing by creating a trust;
how the trust is disposing of her property; and
if the trust is inter vivos, how the transfer will affect her financial health and her ability to provide for herself.
Generally, Can an express trust be created orally?
YES, but must be proved with clear an convincing evidence
Can an express trust pertaining to real property be created orally?
No, it must be in writing to satisfy statute of frauds
What is an honorary express trust?
A trust set up to care for animals or inanimate objects (like a grave site)
Under what jurisdiction are honorary trust legal?
They are legal under the Uniform Trust Code.
Are honorary trusts acknowledged under common law?
NO
When does an honorary trust end?
If there is no trustee,
or if the animal dies.
What type of title to the res is transferred to a trustee in an express inter vivos trust?
Trustee has legal title
Beneficiary has equitable title
Generally will a trust fail if a trustee is unable to serve?
Yet a trust will almost never fail for lack of a trustee. If a trustee designated in the trust instrument becomes unable or unwilling to serve, then normally, a court will appoint a replacement trustee.
Will a trust survive if it is conditioned on a specific person serving a trustee and that person cant serve?
NO
