Trusts — Characteristic and Creation Flashcards
What is the trust creation intent requirement?
The trust is created only if the settlor MANIFESTS an INTENTION TO CREATE the trust.
Similar to wills, do not need the language “TRUST” in order to create a trust, rather, just need an intention. Similarly, even if you say “held in trust,” but your intent says something else, then its not a valid trust.
What is trust property?
Also known as ‘the res,’ this is a low bar to satisfy.
Who can be the beneficiaries of the trust?
One of the beneficiaries of the trust can be the settlor, but there must be at least one beneficiary that is NOT the settlor.
Note: Pets cannot be beneficiaries under a will, HOWEVER, with trusts cats can be beneficiaries.
What are constructive trusts?
These are trusts created by courts in equity. I.e., they are remedies. Constructive trusts are also known as secret or semi-secret trusts. CA, refers to secret / semi-secret trusts as constructive trusts.
What are ways to create a trust?
- By Deed of Trust
- By Declaration
What is a deed of trust?
The settlor of the trust transfers legal title of the property to another person as trustee. These are different than trust by oral declaration because trust by oral declaration typically require an act by the settlor evidencing their intent to make the trust.
How to make a trust by declaration?
Requirements:
- Will usually be in writing (in CA, however, an oral declaration is not sufficient the settlor also has to do something as evidence that they are making the trust);
- If oral, need to also do some act which evidences the settlor wanting to make the trust.
How to revoke a trust?
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What are the elements of a valid trust?
- A settlor;
- intent by the settlor to create a trust;
- the trust property or res;
- delivery;
- ascertainable beneficiaries;
- a trustee; and
- a valid trust purpose
Trust Purple BIRDS
T = Trustee
P = Purpose
B = Beneficiary
I = Intent
R = Res
D = Delivery
S = Settlor
What are the different types of trusts?
