Law Commons^™

When Is A Trust Protector A Fiduciary?, Richard C. Ausness

Law Faculty Scholarly Articles

The use of trust protectors has become increasingly popular in the past twenty years. This is largely due to the fact that settlors can use trust protectors to provide more flexibility in trust management, especially for long-term trusts. However, the use of trust protectors is not without some risk. First of all, the legal status of trust protectors is not explicitly recognized in some states. Furthermore, even in those states which do recognize the legality of trust protectors, the nature and extent of their powers is sometimes not always clear. Finally, there is the vexing question of whether trust protectors …

A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford

Elisabeth Haub School of Law Faculty Publications

The law of wills, trusts, and estates could benefit from consideration of its development and impact on people of color; women of all colors; lesbian, gay, bisexual, and transgender individuals; low-income and poor individuals; the disabled; and nontraditional families. One can measure the law's commitment to justice and equality by understanding the impact on these historically disempowered groups of the laws of intestacy, spousal rights, child protection, will formalities, will contests, and will construction; the creation, operation and construction of trusts; fiduciary administration; creditors' rights; asset protection; nonprobate transfers; planning for incapacity and death; and wealth transfer taxation. This Article …

Tax Recognition, Barry Cushman

Journal Articles

This article was prepared for the St. Louis University Law Journal’s “Teaching Trusts & Estates” issue. Many law students take a course in Trusts & Estates, but comparatively few enroll in a class devoted to the federal wealth transfer taxes. For most law students, the Trusts & Estates course provides the only opportunity for exposure to some of the basic features of the estate tax, the gift tax, the generation-skipping transfer tax, and some related features of the income tax. The coverage demands of the typical Trusts & Estates course do not allow for intensive discussion of these issues, but …

A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford, Anthony C. Infanti

Articles

The law of wills, trusts, and estates could benefit from consideration of its development and impact on people of color; women of all colors; lesbian, gay, bisexual, and transgendered individuals; low-income and poor individuals; the disabled; and nontraditional families. One can measure the law’s commitment to justice and equality by understanding the impact on these historically disempowered groups of the laws of intestacy, spousal rights, child protection, will formalities, will contests, and will construction; the creation, operation and construction of trusts; fiduciary administration; creditors’ rights; asset protection; nonprobate transfers; planning for incapacity and death; and wealth transfer taxation. This essay …

“I’M Not Quite Dead Yet!”: Rethinking Anti-Lapse Redistribution Of A Dead Beneficiary’S Gift, Eloisa Rodriguez-Dod

Faculty Publications

Anti-lapse statutes create a category of substitute takers when a beneficiary prematurely dies. They are based on the legislature’s presumption of how a testator or settlor would want his property distributed in these circumstances. However, a testator’s or settlor’s intent may effectively be frustrated by this presumed intent.

This Article critically examines the tension between an individual’s autonomy and societal goals in the context of anti-lapse statutes applicable to wills and trusts. It scrutinizes the current rules of construction regarding anti-lapse statutes and identifies their deficiencies in their application to wills and trusts. This Article analyzes and identifies the deficiencies …

A Supreme Court Ruling That's About Way More Than Preemption, Nancy Polikoff

Articles in Law Reviews & Other Academic Journals

No abstract provided.

Restricting Testamentary Freedom: Ex Ante Versus Ex Post Justifications, Daniel B. Kelly

Journal Articles

The organizing principle of American succession law — testamentary freedom — gives decedents a nearly unrestricted right to dispose of property. After surveying the justifications for testamentary freedom, I examine the circumstances in which it may be socially beneficial for courts to alter wills, trusts, and other gratuitous transfers at death: imperfect information, negative externalities, and intergenerational equity. These justifications correspond with many existing limitations on the freedom of testation. Yet, disregarding donor intent to maximize the donees’ ex post interests, an increasingly common justification for intervention, is socially undesirable. Doing so ignores important ex ante considerations, including a donor’s …

Empowering Settlors: How Proper Language Can Increase The Enforceability Of A Mandatory Arbitration Provision In A Trust, S. I. Strong

Faculty Publications

With hostile trust litigation reaching epidemic proportions, many people within the trust industry are interested in identifying new and less expensive ways to resolve trust-related disputes. Arbitration is often proposed as a possible alternative, although questions exist about whether and to what extent a mandatory arbitration provision found in a trust will be considered enforceable by a court. Up until now, most commentary in this area of law has focused on purely jurisprudential issues, with little attention being paid to the practical efforts that settlors can make to increase the enforceability of arbitration provisions found in trusts. This Article takes …

The Specter Of Civil Law Clawback Actions Haunting U.S. And Uk Charitable Giving, Aaron Schwabach

Faculty Scholarship

No abstract provided.

Effectively Curbing The Gst Exemption For Perpetual Trusts, Lawrence W. Waggoner

Articles

In "Effectively Curbing the GST Exemption for Perpetual Trusts," I criticized the Treasury Department’s proposal for dealing with perpetual trusts. My objection is that Treasury’s approach would leave many trusts and much wealth GST-exempt for much longer than Congress originally intended. For perpetual trusts created before enactment, Treasury’s approach would allow them to continue to be unburdened by a durational limit. For perpetual trusts created after the effective date of enactment, Treasury’s approach would still allow them to qualify for the GST exemption, but would have the exemption expire 90 years after the trust was created.

Who Is Afraid Of Perpetual Trusts?, Bridget J. Crawford

Elisabeth Haub School of Law Faculty Publications

Professor Lawrence Waggoner nominally aims his critique at wealthy individuals who desire perpetual trusts and the lawmakers who enable them by passing favorable legislation. He lodges five specific objections: (1) after a certain period of time, the beneficiaries of perpetual trusts will be insufficiently related to the trust creator; (2) after a certain period of time, there will be too many beneficiaries of a perpetual trust; (3) perpetual trusts will be expensive to manage; (4) outdated trust instruments will hamper management of perpetual trusts; and (5) trustee turnover will negatively impact perpetual trusts. This Essay considers each of his objections …

Toward Economic Analysis Of The Uniform Probate Code, Daniel B. Kelly

Journal Articles

Insights from economics and the economic analysis of law may be useful in analyzing succession law, including intestacy and wills as well as nonprobate transfers such as trusts. After surveying prior works that have examined succession from a functional perspective, I explore the possibility of utilizing tools like (i) transaction costs, (ii) the ex ante/ex post distinction, and (iii) rules versus standards, to illuminate the design of the Uniform Probate Code. Specifically, I investigate how these tools, which legal scholars have employed widely in other contexts, may be relevant in understanding events like the nonprobate revolution and issues like “dead …

Of Charities And Clawbacks: The European Union Proposal On Successions And Wills As A Threat To Charitable Giving, Aaron Schwabach

Faculty Scholarship

In the United Kingdom, and to a lesser extent the United States, an inter vivos gift, once given, cannot be reclaimed by the giver's heirs. In civil law countries the situation is quite different: Not only spouses, but issue and in some cases even ascendants, are entitled to a forced share of a decedent's estate--and these forced shares are assessed against a notional “estate” that includes the testator's inter vivos gifts. If the total of these forced shares exceeds the amount actually available in the decedent's estate at death, the recipients of the gifts, or their successors, may be forced …

The Game Is Afoot!: The Significance Of Donative Transfers In The Sherlock Holmes Canon, Stephen R. Alton

Faculty Scholarship

This article presents a recently discovered and previously unpublished manuscript written by John H. Watson, M.D., and annotated by Professor Stephen Alton. Dr. Watson’s manuscript records an extended conversation that took place between the good doctor and his great friend, the renowned consulting detective Mr. Sherlock Holmes, regarding issues of gratuitous transfers of property – issues involving inheritances, wills, and trusts – that have arisen in some of the great cases solved by Mr. Holmes. This felicitous discovery confirms something that Professor Alton has long known: these gratuitous transfer issues permeate many of these adventures. Often, the action in the …

Trusts & Estates (Annual Survey Of Michigan Law, June 1, 2011 - May 31, 2012), Susan E. Cancelosi

Law Faculty Research Publications

The Survey period began only two months after the Michigan Trust Code took effect. Thus, attorneys handling matters subject to the new trust law were only beginning to delve into how their practices will change. At the same time, estate planners who handle larger estates spent the first part of the Survey period on edge about federal estate tax uncertainty. Although Congress in mid-December 2010 did act to extend the estate tax relief of the past decade, it did so only temporarily, leaving many questions for future planning. With the new Michigan Trust Code and the federal estate tax changes, …

Us Perpetual Trusts, Lawrence W. Waggoner

Articles

In 2009, the UK reconfirmed tis long-standing public policy against perpetual trusts. America has been moving in the opposite direction. Recent years have seen a movement in the states to pass legislation allowing settlors to create family trusts that can last forever or for several centuries. Sadly, and embarrassingly, the American perpetual-trust movement has not been based on the merits of removing the traditional curb on excessive dead-hand control. The policy issues associated with allowing perpetual trusts have not been seriously discussed in the state legislatures. The driving force has been interstate competition for trust business.

It Is Logic Rather Than Whom You Trust: A Rejoinder To Prof. Cohen, Douglas A. Kahn

Articles

This article is the continuation of an exchange that has taken place between Prof. Stephen B. Cohen and me concerning the validity of criticisms leveled by Chief Justice John Roberts on an opinion by then-Judge Sonia Sotomayor writing for the Second Circuit in the case of William L. Rudkin Testamentary Trust v. Commissioner. While affirming the Second Circuit’s decision, Chief Justice Roberts, writing for a unanimous Supreme Court, criticized and rejected Justice Sotomayor’s construction of the relevant statutory provision. In an article in the August 3, 2009, issue of Tax Notes, Cohen defended Justice Sotomayor’s construction of the statute and …

Wills, Trusts And Estates (Annual Survey Of Virginia Law, 2009-2010), J. Rodney Johnson

Law Faculty Publications

The 2010 Session of the General Assembly enacted wills, trusts, and estates legislation (i) adopting the Uniform Power of Attorney Act, (ii) passing emergency legislation for the construction of tax-oriented wills and trusts of persons who die during 2010 with documents drafted prior thereto, (iii) revising the small-estate statutes, and (iv) clarifying the burial power of attorney. In addition, there were six other enactments, and seven opinions from the Supreme Court of Virginia during the one-year period ending June 1, 2010 that present issues of interest in this area. This article reports on all of these legislative and judicial developments, …

Child Trust Fund, Christopher L. Griffin Jr.

Faculty Publications

No abstract provided.

Message To Congress: Halt The Tax Exemption For Perpetual Trusts, Lawrence W. Waggoner

Articles

The federal estate tax is in abeyance this year. The popular press has picked up on the possibility that the estates of billionaires such as the late George Steinbrenner, who owned the New York Yankees, will escape the tax. The House Ways and Means Committee, chaired by Representative Sander Levin of Michigan, and the Senate Finance Committee, chaired by Senator Max Baucus of Montana, are now considering two questions: what the maximum rate and exemption will be when the estate tax returns and whether the tax will be reinstated for this year. Lurking behind the headlines but equally important is …

Rudkin Testamentary Trust -- A Response To Prof. Cohen, Douglas A. Kahn

Articles

In the August 3 issue of Tax Notes, Prof. Stephen Cohen wrote an article about Justice Sonia Sotomayor’s opinions in three tax cases. Of those three cases, only the opinion she wrote in William L. Rudkin Testamentary Trust v. Commissioner, 467 F.3d 149 (2d Cir. 2006), Doc 2006- 21522, 2006 TNT 203-4, is worthy of comment. Although the Second Circuit’s decision in that case was affirmed by the Supreme Court under the name Knight v. Commissioner, the construction of the critical statutory language that Justice Sotomayor adopted was rejected and criticized by Chief Justice Roberts, writing for a unanimous court. …

Ohio Trust Code Update: Recent Developments, Alan Newman

Akron Law Faculty Publications

This article is based on the author’s presentations at the 20th Annual Estate Planning Conference on Wealth Transfer in Columbus on June 26, 2009.

Since its enactment in 2006, effective January 1, 2007, the Ohio Trust Code (“OTC”) has been amended, a number of cases have been decided under it, and a variety of issues related to or raised by it have been identified. This article will review those developments.

Copyright Acknowledgment: This material is reprinted from the Probate Law Journal of Ohio with permission of Thomson Reuters. Copyright permission is on file.

Wills, Trusts And Estates (Annual Survey Of Virginia) Law, 2008-2009, J. Rodney Johnson

Law Faculty Publications

The 2009 Session of the General Assembly enacted wills, trusts, and estates legislation (1) preventing, in cases where persons die aft.er June 30, 2009, application of a regrettable 2008 Supreme Court of Virginia decision dealing with the rights of illegitimate heirs in intestate succession, and (2) amending Virginia's version of the Uniform Principal and Income Act to provide for taxpayer benefit and clarity in matters relating to total return unitrusts, the marital deduction, and the income taxation of trusts. In addition, there were several other enactments along with four opinions from the Supreme Court of Virginia during the one-year period …

Probate Law Reform And Nonprobate Transfers, Grayson M.P. Mccouch

UF Law Faculty Publications

The advent of widespread, large-scale probate avoidance has added a new dimension to the project of probate law reform. When the Uniform Probate Code made its debut in 1969, its primary goal was to modernize traditional probate procedures and make them more uniform, flexible, and efficient. The Code's reforms were in part a response to the rise of will substitutes which offered a ready means of transferring property at death outside the probate system. In the intervening years, however, will substitutes have continued to proliferate, while traditional probate procedures have resisted comprehensive reform. The probate system has not become obsolete …

Wills, Trusts And Estates (Annual Survey Of Virginia Law, 2006-2008), J. Rodney Johnson

Law Faculty Publications

The 2007 Session of the General Assembly enacted substantially more wills, trusts, and estates legislation than one typically expects, some of which was of a particularly significant nature, such as that (1) providing for the probate of wills not executed with the required statutory formalities; (2) preventing any future application of an unfortunate augmented estate decision of the Supreme Court of Virginia; (3) avoiding the impact of federal Employee Retirement Income Security Act of 1974 ("ERISA") preemption in certain insurance revocation and slayer statute cases; and (4) mandating notice to the public when modification or termination of a charitable trust, …

Class Gifts Under The Restatement (Third) Of Property, Lawrence W. Waggoner

Articles

The new Restatement (Third) of Property (officially the Restatement (Third) of Property: Wills and Other Donative Transfers), in tandem with the Restatement (Third) of Trusts, is systematically proceeding through the whole field of wills, will substitutes, trusts, and estates. Both of the new Restatements should prove to be handy resources for trust and estate lawyers, not only in preparing to argue cases at both trial and appellate levels, but also in the everyday work of drafting and construing dispositive provisions in wills, trusts, and other types of donative documents. Each Restatement section is followed by a set of Comments explaining …

The Offshore Asset Protection Trust: A Prudent Financial Planning Device Or The Last Refuge Of A Scoundrel?, Richard C. Ausness

Law Faculty Scholarly Articles

In recent years, a large number of Americans have established "asset protection trusts" in foreign countries. An asset protection trust is a self-settled spendthrift trust which is created in order to protect the settlor's property from the claims of creditors. Virtually all American jurisdictions recognize spendthrift trusts, which prohibit both voluntary and involuntary alienation of a third party beneficiary's interest in a trust; however, most do not allow a settlor who has retained a beneficial interest in a spendthrift trust to protect that interest from the claims of creditors. A growing number of present and former British possessions, however, have …

Forty Years Of Codification Of Estates And Trusts Law: Lessons For The Next Generation, Gregory S. Alexander, Mary L. Fellows

Cornell Law Faculty Publications

In this paper we develop two theses. First, we argue that uniform law proposals that ask courts and practitioners to abandon revered legal traditions and ways of thinking about estates and trusts, even when they are intent-furthering proposals, face resistance until in time the glories of the past and the risks of a new legal regime fade in importance in legal thought. Second, we argue that, especially within an environment in which states seek to gain competitive advantage over their counterparts in other states, the glories of the past and the risks of a new legal regime fade fastest when …

Wills, Trusts And Estates (Annual Survey Of Virginia Law, 2005-2006), J. Rodney Johnson

Law Faculty Publications

The General Assembly enacted legislation dealing with wills, trusts, and estates that added or amended a number of sections of the Virginia Code in its 2006 Session. In addition, there were six opinions from the Supreme Court of Virginia during the period covered by this review that presented issues of interest to the general practitioner as well as the specialist in wills, trusts, and estates. This article reports on all of these legislative and judicial developments.

Colorado Revisits The Rule Against Perpetuities, Wayne M. Gazur

Publications

The 2006 Colorado General Assembly passed legislation adopting a 1000-year limitation applicable to interests in trust, practically eliminating the Rule Against Perpetuities ("RAP"). This article discusses the legislation's impact on the RAP in trust and non-trust situations.