Podcast
Questions and Answers
What characterizes a resulting trust?
What characterizes a resulting trust?
- It is always based on written agreements.
- It is governed by the Trust Code.
- It arises from implied conduct rather than explicit statements. (correct)
- It must have a clearly defined beneficiary.
In which situation does a resulting trust typically arise?
In which situation does a resulting trust typically arise?
- When there is a failure to adequately describe beneficiaries. (correct)
- When all property is given away without conditions.
- When the trust is successfully executed according to the Trust Code.
- When a settlor clearly defines all beneficiaries.
What happens to the property when an express trust fails?
What happens to the property when an express trust fails?
- It goes to the trust beneficiaries.
- The settlor retains the property. (correct)
- The property is destroyed.
- It automatically transfers to the state.
In a purchase-money resulting trust, why is the title held by someone else?
In a purchase-money resulting trust, why is the title held by someone else?
Who benefits from a resulting trust if the settlor is deceased?
Who benefits from a resulting trust if the settlor is deceased?
Which of the following is NOT a possible legal explanation for a purchase-money resulting trust?
Which of the following is NOT a possible legal explanation for a purchase-money resulting trust?
Which aspect of resulting trusts differentiates them from express trusts under the Trust Code?
Which aspect of resulting trusts differentiates them from express trusts under the Trust Code?
What occurs with property left over after the termination of an express trust?
What occurs with property left over after the termination of an express trust?
Flashcards
Resulting Trust
Resulting Trust
A trust implied by the conduct of the parties, not explicitly stated, where the settlor or their successors retains an interest in the property.
Resulting Trust Beneficiary
Resulting Trust Beneficiary
Either the settlor, or if deceased, their heirs or will beneficiaries, are the potential beneficiaries of the implied trust.
Express Trust vs Resulting Trust
Express Trust vs Resulting Trust
Express trusts are explicitly documented; resulting trusts are implied by actions. The Trust Code covers express, not resulting.
Excessive Trust Property
Excessive Trust Property
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Failed Express Trust
Failed Express Trust
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Purchase Money Resulting Trust
Purchase Money Resulting Trust
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Gift vs. Resulting Trust (Purchase)
Gift vs. Resulting Trust (Purchase)
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Trust Code Applicability
Trust Code Applicability
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Study Notes
Resulting Trusts: Basic Concepts
- Resulting trusts arise from conduct, not explicit statements. They imply a trust without written or spoken agreement.
- Beneficiaries are unclear; often the settlor or their successors (heirs/beneficiaries of will) benefit.
- Unlike express trusts, resulting trusts aren't governed by the Trust Code; express trusts are governed by the Trust Code.
Situations Giving Rise to Resulting Trusts
- Excessive trust property: If a trust's terms don't specify what happens to remaining assets after a condition is met (e.g., "until X reaches 25"), a reversionary interest, the remaining property, is impliedly returned to the settlor.
- Failed express trusts: If a trust fails to achieve its intended purpose (e.g., insufficient/indefinite beneficiary description), the property reverts to the settlor. The settlor retained control.
- Purchase-money resulting trusts: When someone pays for property, but title is transferred to another party, instead of the payer, a purchase-money resulting trust might be implied. This means the payer intended to hold equitable title to the property.
Possible Explanations for Purchase-Money Resulting Trusts
- Gift: One party (the donor/giver) intended to gift the property to the other.
- Debtor-creditor relationship: The payment was a loan, with an expectation of repayment.
- Purchase-money resulting trust: The payer intended to acquire ownership, but property title was placed unintentionally in someone else's name. This is the legal interpretation of a payment for property where the title doesn't follow the payment.
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