Revocable Trusts - Case briefs for cases regarding this topic. PDF

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Case briefs for cases regarding this topic....

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Clymer v. Mayo FACTS:   

Mayo created a trust that would be funded upon her death; her life insurance policy & property would be poured over from her will Mayo died and the life insurance policy & property were poured over into her trust; trust was distributed to the beneficiaries Her parents, her heirs at law, were not beneficiaries of the trust – the contested the trust claiming it was invalid because there was no res/corpus at the time the trust was created

ISSUE: 

Whether the “pour-over” trust is valid

RULE: 

State statute does not require that the trust be more than nominal or even existent at time of creation

REASON: 

Explains that the statute is not conditioned upon the existence of a trust but upon the existence of a trust instrument

HOLDING: 

Mayo established a valid inter vivos trust before her death

NOTES:

Estate of McCreath p. 773 FACTS:     

Mom created trust, she & her daughter were the trustees – upon termination of the trust the trust estate was to be divided equally to all three children Corpus of trust consisted of the family farm Provision in trust requiring that revocation by delivery of writing to Trustees Subsequently mother executed a quitclaim deed transferring farm to daughter & will that revoked all prior trusts Daughter sought to take farm; sons argue that trust was not revoked and that the trust estate should be distributed equally to the children

ISSUE: 

Whether the trust was revoked

RULE: 

 

General rule; trust may not be revoked by the settlor without the consent of all beneficiaries, unless the settlor has explicitly reserved to themselves the power to do so unilaterally If trust agreement provides a specific method for revocation, that method must be strictly adhered to in order to revoke the trust If trust agreement reserves power to revoke by giving notice to trustee in specified form or manner, the settlor may exercise that power only during their lifetimes, & the power cannot be exercised through a will

REASON:   

Based on language in the trust, mom could only revoke trust during her lifetime (will only went into effect upon her death) Mom, as settlor of trust, no longer maintained legal ownership of the trust property – thus she had no legal right to transfer the farm to daughter Settlor’s intent to revoke the trust was not relevant here because trust had explicit way it should be revoked

HOLDING: 

The trust was not revoked

NOTES:

Heaps v. Heaps p. 779

FACTS:    

George & first wife created revocable living trust with both spouses acting as their own trustees; Circle Haven property was transferred to the trust…property was sold First wife died, trust became irrevocable. George ignored from then on (never asserting his rights to which he had under trust, receiving principle, etc.) George remarried & him and new wife created their own trust – that executed quitclaim deed in which the interest from the Circle Haven property would transfer to new trust George’s kids from 1st marriage contest this, arguing that the interest in that property remains in original trust, which the children were entitled too

ISSUE: 

Could the interest from the irrevocable trust be transferred to the new trust

RULE: 

Trust required a duly executed instrument to amend the trust

REASON: 



Because of language in the trust, selling an asset & taking title in name other than that of the trust would not take the property out of the trust – needed some affirmative active beyond merely change in form od title 2nd wife had to return interest from Circle Haven property to original trust

HOLDING: 

Interest from irrevocable trust could not be transferred to the new trust

NOTES:...