Post by congregatio on May 29, 2015 2:44:08 GMT 4
Sherlock Holmes and the Problem of the Dead Hand: The Modification and Termination of 'Irrevocable' Trusts
Richard C. Ausness
University of Kentucky - College of Law
May 15, 2015
Quinnipiac Probate Law Journal, Vol. 28, No. 3, 2015
Abstract:
This Article is about the modification and termination of so-called “irrevocable” trusts. A trust may be made irrevocable at the time of its creation or it may become so at a later time. A testamentary trust is one that is embodied in a will and becomes effective at the testator’s death. Since the testator will be dead by the time the trust becomes effective, he will not be in a position to modify or revoke it. For the same reason, a revocable trust will become irrevocable when the settlor dies or when the power to revoke is released. Finally, an inter vivos trust may be irrevocable when it is first created if the settlor disclaims the right to revoke or modify the trust. Although these types of trusts are irrevocable as far as the settlor is concerned, they can sometimes be modified or terminated by others. This Article will examine the various ways in which irrevocable trusts can be modified or terminated. It will also consider the potential conflicts that may arise when beneficiaries desire to terminate the trust prematurely or change its terms in some significant way.
SSRN-id2608902.pdf (663.96 KB)