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St. Mary's Law Journal

Authors

Arthur Yao

Publisher

St. Mary's University School of Law

Abstract

If a court determines that an instrument created a trust, that trust will not fail for want of a trustee. The analysis for determining whether a trust was created, however, depends on the context the failure arises in. For testamentary trusts, as long as the testator’s intention is clearly manifested in the will, equity will enforce it regardless of the cause of the failure of trustee. The analysis for inter vivos conveyances requires the court to determine whether the failure for want of a trustee was initial or subsequent. If the failure was subsequent, a validly created trust will not fail. If the failure was initial, however, in jurisdictions where an inter vivo trust is revokable, the court must determine whether a trust was created. When a donor is dead, courts generally uphold the trust. However, when the donor is alive and it is clear that the title to the property remains with the donor, the question is whether he holds it in trust for the intended beneficiary. Under Section 32(2) of the Restatement, a trust is created if a conveyance is ineffective only because of an initial failure for want of a trustee. However, courts have yet to adopt this broad rule. Instead, where there is an initial failure of a trustee, the conveyance is ineffective except in special circumstances because there is no grantee-trustee, and the property remains in the grantor. In such a case, there is at most a promise to convey the property in trust and it is up to the court to determine whether consideration was given, and if not, the impact on both the donor and the beneficiary.

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