Bar Essay Deck Flashcards
Facts needed to be established for necessity of guardianship and by what evidentiary standard
(i) person is incapacitated
(ii) it is in the person’s best interest
(iii) person’s rights and property will be protected
(iv) alternatives to a guardianship and available support services were considered and were determined not to be feasible
Clear and convincing evidence
Must a court appoint a guardian who was designated by a testator?
No. That is a presumption but court does not have to follow if not in best interest of ward.
Elements of valid trust
(i) in writing and satisfies SOF
(ii) there is a settlor
(iii) it designates trust property
(iv) appoints a trustee
(v) it identifies a beneficiary
(vi) it is for a lawful purpose
Purchase money resulting trust
one party pays the purchasing price but takes title to the property in the name of another party
constructive trust
A constructive trust is an equitable remedy designed to prevent unjust enrichment from wrongful conduct.
Effect of spendthrift clause when the settlor is a trust beneficiary
Under the “cake and eat it” principle, if the settlor is also a beneficiary of a trust, a spendthrift provision does not prevent the settlor’s creditors from reaching any interest retained by her.
A court may not appoint a guardian who what?
(i) a person who, because of inexperience, lack of education, or other reason is incapable of properly and prudently managing and controlling the ward or the ward’s estate; (ii) a person whose conduct is notoriously bad; or (iii) a person whom the court finds unsuitable.
Merger doctrine
Under the merger doctrine, if the sole trustee is also the sole beneficiary of a trust, the legal title and equitable interest merge, and no trust arises.
RAP
RAP effectively prevents the creation of a perpetual trust for the benefit of non charitable beneficiaries.
Principle vs. income
Under the Uniform Principle and Income Act: (i) interest and net rental income are income; (ii) proceeds from the sale of a trust asset (including any profit resulting from the sale) are principal; and (iii) proceeds from a life insurance policy are principal.
UPIA
A trustee’s investment decisions are governed by the Uniform Prudent Investor Act, which is based on the modern portfolio theory of investing that looks to total return (including the potential for appreciation) and not just ordinary income. Under the UPIA, prudence is making investment decisions is measured by conduct at the time the investment decision is made, and not by outcome or performance.
What must an applicant show in order to be appointed guardian, and by what standard?
The applicant must show by a preponderance of the evidence that: (i) the ward is either totally without capacity to care for himself and his property; (ii) the applicant is eligible to be appointed guardian; and (iii) name the applicant as guardian is in the ward’s best interest.
