Flashcards in Quick Wills & Trusts Deck (133):
In what order are decedent's debts paid from after death?
Expenses and unsecured debts paid i the following order:
1) from personal property in an intestate estate
2) from personal property disposed by will
3) from RP in an intestate estate
4) from any RP disposed by will
5) from any non-probate transfers
*For #2 and #4 -
1) residuary estate
2) general bequests
3) demonstrative legacies
4) specific bequests
What are the rules to qualifying as an executor of an estate?
1) take oath that you will faithfully perform duties
2) give bond to secure performance --in an amount equal to the value of decedent's personal estate + value of any real estate over with the executor is given power of sale
For the first 30 days after an intestate decedent's death, who has priority for appointment as administrator of decedent's estate?
1) spouse who is sole distributee
2) spouse who has written consent of all decedent competant children
3) any distributee who is sole heir
4) any distributee who secures written waivers from all other competant distributees
What are the "omitted spouse" rights?
someone who marries the testator after execution of a valid will and for whom there is no provision in the will, takes the INTESTATE SHARE ofa surviving spouse (1/3 if T was survived by descendants of a prior marriage, otherwise entire estate)
What are the "statutory" rights of a surviving spouse?
Residence - ONLY if S files for elective share - has right to occupy residence
Exempt Persona Property - up to 20k
Family allowance - up to 24k
Homestead Allowance - 20k
What is the surviving spouse elective share?
SS may elect to take a statutorily set fraction of an "augmented" probate estate. (if D had any surviving descendent, 1/3, if no surviving descendents, 1/2
What is the procedure for taking the elective share?
WHEN: file a notice of election within 6 mos 1) after will is admitted to probate or 2) if no will, after administrator of intestate estate is appointed
WHO: must have been legally married to the decedent at the time of death (can be disqualified if willfully abandoned w/o cause)
How is the augmented estate calculated?
FIRST: Probate Estate - after payment of debts but before taxes
SECOND: Transfers to the spouse outside of probate (tangible gifts during marriage excluded) non-probate transfers to SS at death of D (bank accounts/insurance etc)
THIRD: transfers to third parties - certain lifetime gifts that benefit anyone other than the SS (more that 10k dyring calendar year of D's death or 5 years before (includes property gifted in JT w/survivorship rights)
What is Demonstrative Legacy?
A general bequest that specifies a source the money should come from
Who may execute a will?
1) must be at least 18
2) must have testementary capcity. "soundness of mind" at time of execution of the will.
*If T lacks TC at the time of execution of th eill, entire will is denied probate. BUrden is on proponents of will to show by POE
What is the test for Testementary Capacity?
1) understand the nature of the act he or she was doing
2) recollect the nature and value of his or her property
3) recollet the natural objects of his bounty
4) interrelate the above 3`
What are the requirements for a holographic will?
1) wholly in T's handwriting as verified by two disinterested witnesses
2) is signed by testator
Requirements for a non-holographic will?
1) signed by testator, or a proxy signature at T's direction and in T's presence
2) Witnessed: T must sign the will in the presence or 2 witnesses, both present at the same tim when the T signs it or acknowledges it (no preclusion of interested witnesses and Ws don't need to know that the document is a will
3) Subscribed/Attestation: Each ot he 2 witnesses must "subscribe the will in in the presence of the T (aka sign a statement on the will that they witnessed T's signing
Informalities in Will execution can be forgiven when?
IF the will proponent in court establishes by CLEAR AND CONVINCING EVIDENCE that the decedent intended the document or writing to constitute the decednt's will.
this can be done despite non-compliance with almost any of the requirements:
1) one witness (instead of 2)
2) Timing (didn't sign at same time)
3) signed out of testators presence
4) T signed in wrong place
5) fill in the blank will
Who can bring will contests and when?
Only INTERESTED PARTIES can bring a will contest (economic interest that would be adversely affected by probate of the will)
after a will is submitted to probate cour and entered by the clerk:
Party has 6 MONTHS to appeal the clerk's action to the circuit court
1 YEAR to file with the court a bill in equity to impeach the will
When can a separate list of personal property be effective to pass particular items to named recipients?
1) refers only to TANGIBLE PERSONAL PROPERTY
2) in existence AT OR AFTER EXECUTION OF THE WILL
3) must describe the items with REASONABLE CERTAINTY
4) must be SIGNED by the testator
5) must be EXPLICITLY REFERRED to by the will
What is the pre-decesaed beneficiary rule?
If a will leaves property to anyone who predeceased the T, the bequest "lapses" and goes to an alternate taker, if the will named one, or to the residuary estate
What are Anti-Lapse Statutes?
Unless a contrary intention appears in the will, if a beneficiary is 1) T's grandparent or a descendent of T's grandparent, AND 2) presdesceaed the testator, the deceased B's desecendants who survive T tak in place of dead B by representation (In VA, applies ONLY to WILLS not to non-probate PODs)
What is the Pretermitted Child rule?
a child born or adopted after execution of the T's will for whom the will makes no provision(unless will states otherwise):
1) T had no other living child when the will was executed, PC receives what that child would have received under Intestate succession
2) T has a living child when the will was executed and the will made a bequest to that child then in exstance , PC will receive lesser of what child would receive through intestacy or equivalent of the largest bequest to any child which a bequest had been made in the will
What is ademption by extinction?
If specifically bequested or devised property is not in the estate at T's death, the bequest or devise fails
Except: Insurance proceeds from fire or casualty loss PAID AFTER T's death
Any condemnation award for the taking of property, PAID AFTER T's death
What are the methods of revocation in Virginia?
1) a valide subsequent will that expressly or impliedly revokes the previous will and its codicils
2) divorce or annulment revokes by operation of law and provisions in favor of the former spouse
3) physical act of destruction
What physical acts count for revocation of a will in VA?
If T with the intent to revoke a will or codicil (or some person at his direction AND in his presence) CUTS, TEARS, BURNS, OBLITERATES, CANCELS OR DESTROYS a will codicil OR some provision thereto it becomes VOID.
Lost wills and mutilated wills in VA are presumed______
To have been revoked by the T. Can be rebutted by clear and convincing evdience
How can you revive a revoked will?
1) Re-execute the revoked will
2) Republish by seoarate codicil referring explicitly to revoked will
3) Dependant Relative Revocation: If a will was revoked by physical act based on an assumption that another will would be probated, but the other will never is probate, that the revocation of the first will is cancelled and first will is revived
If a testator devises property that is subject to a lien, the lien will be exonerated IF...
the will specifically calls for exoneration of the lien. Otherwise devisee assumes the lien.
What is neccesary to establish undue influence in creation of a will?
1) The effect of the influence was to OVERPOWER and will of the TESTATOR.
2) The existence and exertion of INFLUENCE.
3) The product of the influence was to PRODUCE A WILL that WOULD NOT HAVE BEEN MADE BUT FOR SUCH INFLUENCE.
To incorporate an extrinsic document not present at the will’s execution into the will by reference, all of the following requirements must be met:
(i) the document must have been in existence at the time the will was executed,
(ii) the will must refer to the document as being in existence, and
(iii) the will must identify and describe the document with reasonable certainty.
(if list contains ALL tangible personal property, may be edited AFTER execution of Will)
If one of the necessary attesting witnesses cannot be located, whatw may be substituted for the courtroom testimony of that witness?
A self-proving afidavit
What is the result when one of the attesting witnesses to a will is also a beneficiary?
The will and the bequest are valid, and the witness beneficiary can testify for or against the will.
If one of two joint tenants kills the other, how is title to the property held?
The killer and the victim’s estate each own one half of the property as tenants in common.
An adopted child has the same rights as a natural child for purposes of intestate succession. This means that the child may inherit from or through his adoptive parents and their kin. However, the child may not inherit from or through his natural parents, unless the child_________
the child was adopted by the spouse of a natural parent. In that case, the child may adopt from and through his natural parents and the adoptive parent.
How are the intestate shares of descendants distributed in Virginia?
Per Capita by representation
In a case involving a will with ambiguous language, for a latent ambiguity, evidence regarding facts and circumstances_______
A personal representative's duty to the estate includes es, filing ___________ with the court within_______of appointment
an inventory of the estate, within 4 months
Are intervivos trusts revocable
18 Yes. All inter vivos trusts are presumed revocable if:
Created on or after July 1, 2006
Not expressly made irrevocable by settlor
This is a reversal of the common law rule, and a result of Virginia's adoption of the UTC
Who can revoke a trust
Conservator, guardian, or agent only if either:
Expressly authorized by trust
Authorized by court for good cause
Does a trustee have to post bond?
Not unless the court finds it is necessary to protect the interests of beneficiaries
What is a Pour Over arrangement?
Pour over will
Non-probate vehicle pours over assets into a will
Pour over trust
Will pours over assets in an intervivos trust
What is a self-declaration of trust?
Settlor makes himself both the trustee and beneficiary
But adds a remainder beneficiary
And a successor trustee, who takes over in the event of settlor's incapacity or death
What are the requirements for trust property?
Property must be certain and ascertainable
Legal title must be fully conveyed to trustee
What is the statue of limitations for contesting a revocable trust?
The earlier of:
Two years after settlor's death
Six months after trustee sent person commencing action:
Copy of trust instrument
Trustee's name and address
Notice of time allowed for contesting trust
When a trust is contested, can the trustee be subject to liability for distributing assets in according with the trust?
Only if trustee distributes assets while either:
Trustee knows of a pending judicial proceeding contesting the trust
Trustee has received notice of a possible judicial proceeding that actually commences within 60 days after the notice was sent
What happens if a beneficiary of a trust is determined to have been invalid after receiving assets?
Person must return any distribution already received, but has no further liability
What is a power of attorney?
What makes one durable?
What is a springing power of attorney?
When does a power of attorney terminate?
Definition: Authorizes another person (i.e., agent) to act on behalf of the principal
Durable: States that the power of attorney is not affected by the principal's incapacity or disability
Springing: States that the power of attorney becomes effective upon the principal's incapacity or disability
Termination: Upon principal's death
Who enforces the terms of a charitable trust?
Settlor, if alive, otherwise attorney general of the state
What is the distinguishing characteristic of an intervivos trust?
It is created during the lifetime of the settlor
This is what makes it an effective non-probate transfer vehicle
What is required for a trust to have a valid purpose?
Further commission of a crime
Call for destruction of property
Impose unreasonable conditions
What happens when the stated charitable purpose of a charitable trust can no longer be accomplished?
May be reformed under Cy Pres
What are the restrictions on honorary trusts for pets?
Only animals alive during the settlor's life can be beneficiaries (i.e., trust terminates on death of animal)
What is a constructive trust, when is one created?
Equitable device to remedy a bad act. Where a codicil would other wise be valid, revoke if:
Wrongful conduct +
What is a resulting Trust?
Similar to a constructive trust in that it does not require the formalities of a normal trust
When the purpose of a trust cannot be achieved, the money "results back" to the settlor
Purchase money resulting trust (PMRT)
* If A purchases land and title is put in B's name (not a relative) for no reason, there is a presumption that B holds the property in a resulting trust for A
* Presumption must be rebutted by clear and convincing evidence that the purchase was a gift for B
What is a Spendshift Trust?
Are they enforceable?
Trust that restricts the ability of creditors to reach the trust assets
Enforceable unless violates public policy:
1. Child support obligations
2. Fees to lawyer who protected beneficiary's interest
3. Claims by government
4. Mandatory distributions not made by trustee
What is it called when a settlor places his assets in a spendthrift trust but retains the right to receive future payments at the trustee's discretion?
Qualified self-settled spendthrift trust, or asset protection trust
What are the qualifications for a qualified self-settled Spendthrift trust?
1. VALID trust
3. SPENDTHIRFT CLAUSE
4. QUALIFIED TRUSTEE
5. ADDITIONAL BENEFICIARY other than SETTLOR
6. when distributions made to settlor
6. Settlor cannot disapprove of distributions
What is an oral trust?
A trust of either personal or real property, the terms of which can be proven by clear and convincing evidence
When can the settlor of a qualified self-settled spendthrift trust challenge a trustee's refusal to distribute?
Only if clear terms that trigger distribution have been met (e.g., amount needed for financial support)
What are the requirements for beneficiaries?
Depends on type of trust:
Must have definite and ascertainable beneficiaries
Interests must vest within the period of RAP
Must have indefinite group of beneficiaries
Must have a charitable purpose
Not subject to RAP
Must have beneficiaries that cannot complain
May be pets and cemeteries
Not subject to RAP
What are the trustees obligations?
Act for benefit of beneficiaries, unless beneficiaries provide consent after complete and full disclosure
Buying or selling trust assets to himself
Borrowing trust funds
Loaning funds to the trust
Profit from serving as trustee via confidential info
Buy stock of corporation if corporate trustee
Do trustee beneficiaries have an action against third parties involved in self-dealing with the trustee?
Not if they are bona fide purchasers, which does not include parties that are either:
Aware of the self-dealing
Related to the trustee
What is the statute of limitations for an action against the trustee?
One year from when
Trustee gives beneficiary report (accounting) that:
1. Discloses facts that show existence of breach
2. Informs beneficiary of time to bring action
Five years from the earlier of:
Trustee's removal, resignation, or death
Termination of beneficiary's interest
Termination of trust
Can the settlor waive the trustee's obligations?
Yes, after complete and full disclosure, unless:
Waiver of legal purpose requirement
Waiver of trustee's obligation to act in good faith
Waiver of trustee's obligation to not intentionally or recklessly act contrary to beneficiary interests
Waiver of statute of limitations to bring action
Waiver of court's power to modify trust, remove trustee, require fiduciary bond, or deny trustee compensation
What are the specific duties of a trustee?
1. ACT PRUDENTLY
2. BE IMPARTIAL in relationship to beneficiaries
3. CONTROL and protect TRUST PROPERTY
4. COLLECT TRUST PROPERTY and defend claims
5. SEGREGATE TRUST PROPERTY FROM OWN
6. Keep ADEQUATE RECORDS
7. Keep BENEFICIARIES REASONABLY INFORMED
8. FURNISH COPY of TRUST INSTRUMENT on request
9. 60-day notice provision
10. ANNUAL REPORTS
What are the trustees notice obligations.
After the trustee accepts, he must notify beneficiaries within 60 days of:
Beneficiaries' RIGHTS TO REQUEST copy of trust
Beneficiaries' RIGHTS TO ANNUAL REPORT
TRUSTEES NAME, address, phone, and e-mai
What is a trust protector?
Someone other than the corporate trustee who makes sensitive personal decisions regarding the trust
How can a corporate trustee avoid a fiduciary duty breach from following the trust protector's directions?
Have settlor incorporate Virginia trust protector provisions in the trust instrument
Avoid instances of willful misconduct or gross negligence in following trust protector's instructions
What are trustee's powers?
Virginia's trust code expressly a uthorizes a trustee to do whatever the fee simple owner of the property could do, so long as:
No self dealing
Settlor doesn't say otherwise
What are a trustee's responsibility with regard to prudent investing?
Virginia has adopted the Uniform Prudent Investor Act (UPIA) which utilizes a portfolio theory of investing (i.e., so long as the investment fits the portfolio, it is prudent - do not look at the investment individually)
What is a trustee's responsibility with regard to prudent investments when the trustee was selected based on his skills?
Trustee will be held to that level of expertise in evaluating his prudence
Under UPIA how are investment returns measured?
Total return, including income, but also:
What is the trustee's responsibility with regard to allocating income between income and remaindermen beneficiaries?
Trustee must act impartially between the two by either:
How does a trustee exercise his investment power?
Trustee distributes income to the income beneficiary, but also some of the capital gains to promote fairness
Rule of thumb - 10% of capital gains can be allocated
How should the trustee distribute the following expenses between income and principal beneficiaries:
Trustee's fees: Half and half
Ordinary expenses: Income beneficiary
Capital expenses: Principal beneficiary
What is a Unitrust?
Allows trustee to avoid having to allocate between income and remainder beneficiaries
Instead, income beneficiary gets between 3% and 4% of FMV of trust, remainder beneficiary gets everything else, regardless of amount of income generated
Who can the trustee delegate powers to?
Is the trustee liable for delgatee's actions?
Can delegate powers, including investment power, to agent
No liable for delegatee's actions so long as trustee exercised reasonable care in:
Establishing terms of delegation
Reviewing agent's decisions
Is a trustee liable on contracts entered into as trustee?
No, so long as trustee:
Acted in fiduciary capacity
Disclosed fiduciary capacity
Contract does not say otherwise
Is a trustee liable for torts committed while trustee?
Yes, so long as trustee is personally at fault
What constitutes an unreasonable condition of a trust?
What is not unreasonable?
Trust encourages divorce
E.g., income to Betty, but also principal if she divorces
Trust provides money until person remarries
E.g., income to Betty until she remarries
Trust encourages beneficiary to marry Jewish boy
E.g., income to Betty if she marries a Jewish
Does a co-trustee have liability for actions taken by other trustees?
No, so long as the co-trustee:
Did not join in the action
Notified other trustees
How many co-trustees have to agree on a decision for it to be ratified?
Can an irrevocable trust ever be modified or terminated while settlor is alive?
Yes, if the settlor and all the beneficiaries consent and the court does the modification or termination
Even if the living settlor does not agree, the court may allow modification or termination
Can an irrevocable trust ever be modified or terminated after the settlor dies?
Yes, provided that:
1. All beneficiaries consent
------Modification or termination is not inconsistent with purpose of trust
2. Not all beneficiaries consent
-----Court is satisfied that:
----------Trust could be modified if all consented
-----------Interests of beneficiaries not consenting (e.g., unborn child) will be protected
When can a court modify or terminate a trust without all beneficiaries' consent?
I. Unanticipated circumstances
Modification or termination will further purpose of trust based on unanticipated circumstances
II. Tax advantages
Modification or termination will achieve settlor's tax objectives
No trust purpose remains to be achieved
Purposes of trust are now unlawful, contrary to public policy, or impossible to achieve
If value of trust is
Can a trustee ever combine or divide trusts?
Yes, without court approval, so long as it does not frustrate the purposes of the trusts (e.g., to gain more investment ability)
Can a court reform the terms of a trust even if the terms are unambiguous?
Yes, if proved by clear and convincing evidence that the settlor's intent and the trust terms were affected by a mistake of fact or law
E.g., allow sale of house despite trust restriction so that wife can get a new house in a more suitable zoning district
A trustee has a duty to administer a trust ____________________, ____________________, and ____________________.
prudently; in good faith, in the interest of the beneficiaries
In order for beneficiaries to compel modification or termination of the trust, how many of the beneficiaries must consent to the change?
Unless explicitly disclaimed, what is implicitly read into a trust?
revocability by the settlor
If a debtor is a beneficiary under an absolute discretionary trust, how can her creditors be repaid?
The creditors can demand payment from the trustee, up to the amount owed them if the trustee decides to issue money to the debtor beneficiary.
At what point may general creditors reach a spendthrift trust beneficiary’s interest?
Upon the payment of the trust income to the debtor beneficiary.
A father placed $6 million into a revocable trust. The trust is to provide his two daughters with income for life and, on their death, the corpus is to be distributed to their children in equal shares. One of the daughters has no present assets and owes her creditors $500,000. What actions can her creditors take to obtain payment from the trust money?
The creditors can obtain a judgment to garnish the daughter's trust income until her debt is satisfied.
In which of the following scenarios would a resulting trust NOT be implied or presumed?
Alton lends Benson money so that Benson can purchase a house.
Alton lends Benson money so that Benson can repair his boat.
Alton creates a trust, the purpose of which is fully satisfied before all the trust property is distributed to beneficiaries.
Alton creates a charitable trust, the purpose of which is impossible, and a court determines the cy pres doctrine
Alton lends Benson money so that Benson can repair his boat.
In order for a purchase money resulting trust to result from a loan, a beneficiary must furnish consideration to a trustee for the acquisition of real or personal property, not just the repair or maintenance thereof
Mack creates a testamentary trust for the benefit of the preservation of the lake near his home so that the residents of his hometown will have fresh drinking water. After Mack's death, the lake is sold and public access is closed. The court directs the trustee to reallocate the trust funds to cleaning up the river that runs through the town, but which had been too contaminated beforehand for drinking. Is the reallocation of the money valid?
Yes, because it is as near as possible to the original purpose of the trust.
A valid pour-over gift may be made by will to a trust that was created at any time_______
before, concurrently with or after the will’s execution.
Which of the following is true of a settlor’s ability to revoke or amend a trust?
A settlor may use any procedure manifesting clear and convincing evidence of the settlor’s intent to revoke or amend the trust.
In VA a specific devise of stock that is converted due to merger with another bank---
Devisee is entitled to new stock
What is the order of abatement to pay debts of an estate?
Source of payments abate as follows:
1 PP through intestate succession
2 PP in the residuary estate
3 general legacies
4 specific and demonstrative bequests
5 real property
*life insurance proceeds are not subject to abatement rules
When does a resulting trust arise?
1) an EXPRESS TRUST FAILS in whole or in part
2) a settlor makes an INCOMPLETE DISPOSITION of the trust property and there is excess corpus; OR
3) a purchaser PAYS THE PURCHASE PRICE OF THE PROPERTY and causes title to be taken in another's name.
What are the requirements for a document incorporated by reference to be valid?
1) doc must be in existence at the time the will is executed.
2) the will must refer to the document as being in existence; AND
3) the will must identify and describe the document with reasonable certainty.
Under the Uniform Trust Code, as adopted by Virginia, a trustee may resign by giving ____days notice to the settlor (if living), all co-trustees, and all qualified beneficiaries (other than beneficiaries under a revocable trust
This type of trust contains a provisison prohibiting voluntary and involuntary transfer of a beneficiaries interest, which might read as follows: "no interest of any beneficiary herein shall be transferable by the beneficiary, nor shall such interest be reachable by the beneficiaries creditors by garnishment, attachment, or other legal process.
Under the Uniform Trust Code, as adopted by VA, fully explain how it is possible to create a perpetual trust in Virginia?
RAP does not apply to any trust if the trust instrument, by its terms, provides that the RAP shall not apply to the trust. To create a perpetual trust in VA, the trust instrument must indicate that the RAP does not apply.
What is a support trust?
A trust in which the trustee's discretionary power to make distributions is tied to a standard such as "support" or "maintenance"
In VA, what constitutes "presence" for the purposes of witnesses signing in the presence of a testator' will execution?
VA courts have adopted, "conscious presence" test. Not necessary that the testator actually be able to see the witnesses when they sign. They are in his presence if he is aware of where they are and what they are doing.
SUppose one or more of the witnesses signs the will immediately before the testator signs it. THe exact order of signing is not material as long as the signings occurred as a part of a__________and ___________ transaction
single and continuous
VA permits a will to be reovked by physical act by another person as long as the following two requirements are met:
1) at the testator's direction
2) in the testator's presence
VA does not adopt the will revival rule at common law. What is that?
If a second will is executed containing language revoking a first will. The first will is dead the moment will 2 is executed and will not be revived if will 2 goes missing.
A presumption of undue influence arises if the contestant shows by clear and convincing evidence that:
1) testator suffered from WEAKNESS OF MIND
2) testator named a beneficiary with whom the testator stood in a RELATIONSHIP OF CONFIDENCE or dependence
3) the testator previously expressed a CONTRARY INTENTION or previously had expressed no intention regarding the disposition of her property
How do you show fraud in a will?
1) knowingly false statements
2) with the intent to deceive testator
3) testator was ignorant of the falsity
4) jane relied on the false statements which induced her to act
A decedent’s interest in any multiple-party account ______be included in the inventory of his estate, even if it is ____________
held in Joint Tenancy
The administrator is appointed by______
the CLERK of the Virginia Circuit Court
What is the order of priority for appointment of administrator of an estate during the first 30 days?
(i) a sole distributee or his designee; or
(ii) any distributee, or his designee, who presents WRITTEN WAIVERS of the right to qualify from all other competent distributees.
If the testator does not sign in the presence of the witnesses, she may__________her signature in their _____________.
For an attested will, there is no requirement that the witnesses sign at ____________
the end of the will
If a testator dictates the will to a beneficiary who handwrites it, the beneficiary's writing of her name can ____________
constitute her signature as a witness
When specifically devise property is sold by a guardian or conservator for an incapacitated person, the specific beneficiary is entitled to ________.
When does it not apply?
a general legacy in an amount equal to the net sale price of the specific item disposed of
- does not apply if prior to death the testator's disability ceased and the testaotr survives for another 1 year
VA follows per capita by representation which means?
All cousins share equal portions, irregardless of how many children each child had.
What is a Constructive Trustee's only duty?
to convey the property to the person who would have owned it bur for the fraud, undue influence, abuse of confidence, or mistake in the transaction that originated the problem.
What is a Totten trust?
is a form of trust in which the settlor places money in a bank account or security with instructions that upon the settlor's death, whatever is in that account will pass to a named beneficiary. Settlor uses the account normally during her lifetime.
When will a court compel distribution of TRUST INCOME?
When its spelled out in the trust instrument. diminishing trust does not relieve trustee of obligations. Would be a breach of FISUCIARY DUTY and BREACH OF GOOD FAITH to do anything else.
When will a court compel distribution of TRUST PRINCIPAL?
The trust instrument must give the trustee express power to invade the principal IF NECESSARY TO FULFILL THE TRUST OBLIGATIONS. Look at INTENT OF SETTLOR, must be carried out if can be done lawfully.
Discretionary powers of a trustee are broadly construed and should not be overruled by a court unless a trustee has abused its discretion.
When is a co-trustee not be liable for the misappropriations of the other co-trustee?
co-trustee would be jointly and severally liable for the acts, unless he exercised reasonable care in:
1) PREVENTING the breach of trust or
2) COMPELLING the co-trustee to REDRESS the BREACH
Are trustees individually liable on a trust if they sign a contract as co-trustees?
No, can only be liable individually if the trustee in entering the contract, failed to reveal his representative capacity.
What is the VA slayer statute?
If a beneficiary kills the testator, they get nothing.
In VA, can you disinherit a child?
Yes, express disinheritance is permissible so long as there is a complete disposition of the testator's estate in the same will that is disinheriting the child.
How does a named executor establish capacity after decedent dies?
1) Offers the will for probate, in CC of last domicile of decedent.
2) After admitted for probate, the court will issue LETTERS TESTEMENTARY, which etablish capacity.
3) Post fiduciary bond (unless requirement waived by will)
when an owner retains less than full interest in a land he has devises (i.e. if he is passing a life estate in his will), he maintains a what?
Reversionary Interest. After the life estate is extinguished the land will pass to the residuary (if there is no residuary through intestacy)
What is equivocation?
Extrinsic evidence is allowed to cure a latent ambugiuity when in a will, although clear on its face of the property and the beneficiary, results in a misdescription when applied to the facts to which it refers.
Is a will devise conditioning that the beneficiary marry a specific person valid?
Yes. Gifts tied to total restraints on marriage would be invalid, but a partial restraint (to a specific person) is ok.
If a will devises property in a trust, and the trustee predeceases, what happens to the trust?
The trust does not fail. The trust is enforceable by someone named in the trust instrument, or appointed by court.
What effect does the following gift language have: "I give and devise my residence property to my wife, to do with as she pleases, and if it remains undisposed of at her death, title shall pass to my broter."
Wife owns in fee simpler. If a will beneficiary is given absolute dominion over property, a provision of an attempted gift over i.e. "what remains undisposed" is void for repugnancy.
What is the stock exemption in Virginia to ademption by extinction.
Specific devisee of stock is entitled to securities of another corporation owned by the testator as a rsult of ta merger, consolidation or other such action.
Inter Vivos Trusts created before____________are irrevocable and cannot be amended unless expressley stated.
July 1, 2006. Trusts created after that date are revocable and amendable by the settlor unless the terms EXPRESSLY STATE OTHERWISE