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Trusts • Introduction
TRUSTS#000
Legal Definition
In the Wills deck, you learn how some people create a plan on how they want their stuff given away when they die. Wills work pretty easily. You basically have someone with stuff, then they die, then that stuff transfers to someone else who isn't dead. Trusts are a bit different. With trusts, property is legally given to one person (called a trustee) so that they can manage the property for the benefit of a different person (a beneficiary). In other words, a person is trusting that the person they elect to have control over the property will handle the property in a way that is authorized and intended by the original owner.
When diving into the world of Trusts on exams, you'll encounter three main battlegrounds: how Trusts are born (formation and validity), the must-dos for trust caretakers (fiduciary duties of trustees), and the "what now?" when things go south (remedies for breach of fiduciary duty).
To whip up a trust that stands the test of time (and law), you need seven ingredients: a trustor to light the spark, a trustee to keep the flame, a clear wish to start this trusty bonfire, something valuable to fuel it (the trust property), passing that fuel to the trustee, people who'll get cozy by the fire (beneficiaries), and a purpose for gathering around that isn't going to ruffle any legal feathers.
Now, if the trustor's move to create a trust is labeled as "valid" in the exam question, you can skip the ingredient check. But if the "v" word is missing, you better roll up your sleeves and check those elements one by one. And don't get tripped up if you see a trust popping up in a will; unless the will itself is stamped with a seal of validity, you've got more digging to do.
It's like trust law got a page out of the will-writing handbook: if a will can fall apart because someone was whispering sweet nothings into the testator's ear (undue influence), or they were seeing pink elephants (insane delusions), or got tricked or bungled the details, a trust can tumble down for the same reasons. Keep your eyes peeled for these trust-busters, and you'll navigate through Trusts exams with a steady hand.
When diving into the world of Trusts on exams, you'll encounter three main battlegrounds: how Trusts are born (formation and validity), the must-dos for trust caretakers (fiduciary duties of trustees), and the "what now?" when things go south (remedies for breach of fiduciary duty).
To whip up a trust that stands the test of time (and law), you need seven ingredients: a trustor to light the spark, a trustee to keep the flame, a clear wish to start this trusty bonfire, something valuable to fuel it (the trust property), passing that fuel to the trustee, people who'll get cozy by the fire (beneficiaries), and a purpose for gathering around that isn't going to ruffle any legal feathers.
Now, if the trustor's move to create a trust is labeled as "valid" in the exam question, you can skip the ingredient check. But if the "v" word is missing, you better roll up your sleeves and check those elements one by one. And don't get tripped up if you see a trust popping up in a will; unless the will itself is stamped with a seal of validity, you've got more digging to do.
It's like trust law got a page out of the will-writing handbook: if a will can fall apart because someone was whispering sweet nothings into the testator's ear (undue influence), or they were seeing pink elephants (insane delusions), or got tricked or bungled the details, a trust can tumble down for the same reasons. Keep your eyes peeled for these trust-busters, and you'll navigate through Trusts exams with a steady hand.
Visual Aids
