Trusts

Requirements for a valid trust (7):
"Some Day Insane Rules Be Valid Trust"

1. Settlor
2. Delivery
3. Intent
4. Res/corpus
5. Beneficiary
6. Valid purpose
7. Trustee

Types of trusts (13)
"Do My Stupid Sentences Have Some Sanity Rather Than CC's Paw Results?"

1. Discretionary
2. Mandatory
3. Support (part of discretionary or mandatory)
4. Spendthrift
5. Honorary
6. Secret
7. Semi-secret
8. Revocable
9. Totten
10. Charitable
11. Constructive
12. Pour over wills
13. Resulting trusts

Modification and Termination of trusts

1. General rule
2. Claflin doctrine
3. Changed circumstances

Trustee duties:

Fiduciary duties
1. No self-dealing
2. Loyalty/conflict of interest
3. Relating to care of trust property

Trustee duties relating to care of trust property:

1. collect and protect trust property
2. earmark trust property
3. not to commingle trust funds
4. not to delegate investment decisions
5. maintain marketability of trust property
6. keep trust property productive
7. diversify investment
8. not to speculate
9. account to trust beneficiaries

Definition of private express trust

a fiduciary relationship w/ respect to property whereby a trustee holds legal title for the benefit of a beneficiary, which arises out of a manifestation of intent to create it for a legal purpose

Charitable trust checklist

a. Purpose (statute of Elizabeth v. restatement (any substantial benefit to society)
b. Creation: go thru private trust checklist (legal charitable purpose)
c. Beneficiary: society (individual may be incidentally benefit)
i. If small group, two views: it’s a private express trust because only few people benefit v. it’s a charitable trust because society is benefited
d. Look out for:
ii. Cy pres (as nearly as possible) ct can modify trust to carry out S’s GENERAL charitable intent (ascertained by trust and extrinsic evidence)
1. If specific intent expressed, then ct is banned from invoking cy pres
2. Otherwise use resulting trust
iii. RAP: no problem with RAP for charitable trusts (only)

3 Rules re Duty to Invest

1. state lists
2. prudent investor rule
3. Uniform Prudent Investor Act