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Trusts - Coggle Diagram
Trusts
Creation
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Intent: Present intent to creat a trust now, not in the future.
Trustee: Must have mental capacity to administer trust (cannot be a minor or a mentally incompetent person) Corpotations can be trustees
Res-trust property: settlor places title to trust property and delivers to the trustee by 1) intent or 2) a testamentary trust.
Identifiable beneficiary: Except for charitable trusts, trust must have definite or ascertainable beneficiaries.
Modification: Settlor can revoke or amend the trust unless it is a irrevocable trust. Beneficiaries: if they wish to modify the trust that conflicts with a material purpose of the trust, then the settlor's consent is required. Trustee can termite a trust when the property's value is less than $50,000
Spendthift provision: When a beneficiary cannot voluntarily or involuntarily transfer his interest in the trust. Does not apply when there is a claim by the government or a claim for child support or spousal maintenance, or for necessary supplies or services rendered to a beneficiary.
Trustee
Powers
1) Settle or abandon trust claims
2) exercise all rights and powers an unmarried individual has over his own property.
3) Borrow money
4) Sell or lease trust assets
5) Apportion trust income
6) Incur reasonable expenses necessary to maintain trust property
Duties
1)Duty of loyalty and good faith. 2) Duty to preserve trust property and make it productive 3) duty to dispose of wasting non-productive assets 4) Duty to maintain accounting of transaction 5) Duty to enforce claims and defend trust from attack
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Types
Express Trust: The property owner must intend to create trust. 1) private express trusts; comprise most of the trusts established by individuals 2) charitable trusts: resemble private express trusts but have some significant, distinguinsing characteristics.
Inter vivos: Trust created by a decleration of trust by the property owner, stating the trustee holds the property as trustee in trust.
Testamentary trust is created by a will.
Charitable Trusts have distinctive rules because of their benefit to society. Must have a charitable purpose, for example; relief of poverty, advancement of education, advancement of religion.
Implied Trust : Arise by operation of law. 1) resulting trust places property in the hands of rightful owners when circumstances require it, even though there has. not been any wrongdoing on anyones part. 2) constructive trusts: deprive a wrongdoers from retaining improperly obtained property.
Constructive trusts are an equitable remedy in cases involving wrongful conduct or unjust enrichment: Trustee must convey property to person who owned but for the wrongful conduct.
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