Deck 50: Trusts and Wills

Question 1

The courts may create implied trusts.

Answer 1

True

Question 2

A totten trust is irrevocable, even by the creator.

Answer 2

False

Question 3

A second will automatically revokes an earlier will if it is wholly inconsistent.

Answer 3

True

Question 4

A trust for the dissemination of a particular political doctrine cannot be a charitable trust.

Question 5

A trust may serve any purpose that is not illegal or against  public policy.

Question 6

An express trust may be found if the intent of the grantor to create a trust is unmistakable.

Question 7

Constructive trusts are generally found where the creator clearly intended a trust to be formed.

Question 8

A resulting trust depends on a contract or agreement as evidenced by the parties' acts.

Question 9

The death of the beneficiary will generally terminate the trust.

Question 10

A minor's declaration of trust is voidable.

Question 11

A trust is presumed to be irrevocable unless the grantor reserves the power of revocation.

Question 12

Creditors of the beneficiary of a spendthrift trust can attach the income of the trust before or after the beneficiary receives it, but they cannot reach the trust fund itself.

Question 13

A witness to a will who is "interested" will be disinherited or disqualified.

Question 14

A codicil to the will must be executed with all the formal requirements of a will.

Question 15

In most states, there is no lower age limit for testators as long as they understand the extent of their property.

Question 16

A person's written statement that he is leaving property "to Margaret in full confidence and with hope she will take care of Tina" is too indefinite to create a trust.

Question 17

If a will was burned in an electrical fire that destroyed the testator's home, it will be presumed to be revoked.

Question 18

Consideration is not necessary in order to enforce a trust.

Question 19

There is no such thing as an irrevocable will.

Question 20

The powers of a trustee are determined solely by the trust instrument.

Question 21

The owner of legal title to the property in a trust is the:

A) grantor.
B) settlor.
C) beneficiary.
D) trustee.

Question 22

A court will require witnesses' signatures to be proven before a formal decree will be issued allowing the will.

Question 23

Divorce or marriage will result in a revocation of a will.

Question 24

A trust for the establishment and maintenance of a museum would be a charitable trust.

Question 25

An express trust is a trust:

A) established by law through the courts when the parties' conduct warrant the creation of a trust.
B) established by voluntary action and evidenced by a written document or oral statement.
C) created only by an oral statement.
D) created only by a written expression.

Question 26

The executor or administrator does not occupy a fiduciary relationship with regard to the estate.

Question 27

A will entirely in the handwriting of the testator is called what type of will?

A) Nuncupative.
B) Holographic.
C) Conditional.
D) Codicil.

Question 28

Once a trust is validly created, it is usually irrevocable.

Question 29

Renunciation is a statutory right of a surviving spouse to give up her statutory share in the estate.

Question 30

If a person dies intestate, his property will be:

A) given to his beneficiaries.
B) passed to his children.
C) kept by the state.
D) distributed as prescribed by the state.

Question 31

An attorney receives a check from the defendant in settlement of a lawsuit brought by his client, the plaintiff. Even if the check is made out in the name of the attorney, it will belong to the client as a:

A) resulting trust.
B) constructive trust.
C) totten trust.
D) spendthrift trust.

Question 32

A totten trust may also be referred to as a savings account trust.

Question 33

A stepchild will not ordinarily inherit under intestacy statutes unless legally adopted.

Question 34

Lathan served as a witness to Samuel's will, but died before Samuel. When Samuel's will is probated, proof of Lathan's handwriting is necessary unless there are enough other witnesses to meet the statutory requirements without Lathan .

Question 35

A completely handwritten will is valid only if witnessed.

Question 36

As long as a decedent's wishes are clear, the formalities of a will need not be strictly met in order for the will to be valid.

Question 37

A photocopy of a will or a will written in pencil would not be valid for probate.

Question 38

Of the following elements, which one is NOT required to create an enforceable trust?

A) Consideration.
B) Legal capacity.
C) Specific property.
D) A beneficiary.

Question 39

A totten trust involves a bank account opened by the settlor of the trust.

Question 40

Taxes imposed at death include:

A) income tax that the estate must pay on income received during estate administration.
B) federal estate tax on the transfer of property at death.
C) state inheritance tax on the privilege of an heir or beneficiary to receive the property.
D) All of these.

Question 41

The characteristics of a totten trust include:

A) it is a joint bank account opened by the settlor of the trust.
B) it is tentative.
C) transfer of ownership is complete only on the depositor's death.
D) These are all characteristics of a totten trust.

Question 42

A trustee has a duty to make proper allocation of benefits and burdens between income beneficiaries and remaindermen. Which of the following statements is true concerning this allocation?

A) Current expenses are chargeable to the remaindermen.
B) Extraordinary expenses are chargeable to the remaindermen.
C) Money paid for the use of trust property is chargeable to the remaindermen.
D) Any profit from the use of trust property is allocated to the remaindermen.

Question 43

All of the following may, in general, revoke a will by operation of law EXCEPT:

A) subsequent marriage.
B) subsequent divorce.
C) birth of a child.
D) all of these will revoke a will by operation of law.

Question 44

A statement signed by the required number of witnesses who observe the execution of a valid will is called a(n):

A) validity clause.
B) ambulatory clause.
C) attestation clause.
D) fiduciary clause.

Question 45

An amendment to a will is called a(n):

A) stipulated addition.
B) statutory adjustment.
C) codicil.
D) attestation.

Question 46

Probate is the:

A) reading of a will by a lawyer.
B) actual property given away in a will.
C) process of declaring a person dead.
D) process of managing the distribution of a deceased person's property.

Question 47

Which of the following is true about a constructive trust?

A) It normally contains detailed instructions for the trustee to follow.
B) The court imposes it to redress an injustice.
C) It is revocable by the trustee.
D) It carries out the intentions of the trustee.

Question 48

Which of the following statements about wills is correct?

A) A will must be written on one piece of paper.
B) Another writing may be incorporated by reference into a will.
C) The testator must sign his or her full name.
D) The testator cannot have any "help" in signing a will.

Question 49

A valid will must be witnessed. Which of the following statements about witnesses is correct?

A) Most states require only one witness to a will.
B) The witnesses must see the testator write the will.
C) The witnesses must sign the will.
D) Under the law in all states, witnesses lose any bequests to them in a will they witness.

Question 50

In most states, a trustee's investment decisions are usually governed by:

A) the prudent person rule.
B) judiciary determination.
C) the beneficiary's intent.
D) The Uniform Principal and Income Act.

Question 51

A living will is a document that:

A) is videotaped.
B) contains the maker's wishes regarding extraordinary medical treatment.
C) is capable of being changed from time to time, unlike other wills.
D) cannot be revoked.

Question 52

Testamentary capacity refers to:

A) the age of the testator.
B) the same capacity as required to contract.
C) the ability to understand the nature and extent of one's property, to appreciate the natural objects of one's bounty, and the ability to formulate an orderly plan of disposition.
D) the influence of others over the testator.

Question 53

Almost all jurisdictions require that:

A) express trusts of real property be in writing.
B) trusts have at least four witnesses.
C) an inter vivos trust have at least two trustees.
D) a charitable trust have at least two trustees.

Question 54

Which of the following may invalidate a will?

A) Duress.
B) Undue influence.
C) Fraud.
D) All of these may invalidate a will.

Question 55

In order to be valid, a will must generally include all but which one of the following?

A) Signature of the testator.
B) A written document.
C) Signatures of witnesses.
D) Signature of the executor.

Question 56

Megan, who has no heirs or next of kin, makes a will leaving her estate to her best friend, Pat. If Megan's will is witnessed by only two instead of three people as required by her state statute, upon her death her estate will:

A) go to Pat without court involvement.
B) escheat to the state.
C) go through probate, at which time the court will try to determine Megan's intent as to disposition and follow that intent.
D) be given to a charity as determined by the probate court.

Question 57

A trust created by will and effective after the death of a testator is called a(n):

A) charitable trust.
B) cy pres trust.
C) inter vivos trust.
D) testamentary trust.

Question 58

The characteristics of a spendthrift trust include which of the following?

A) Spendthrift provisions are not valid in most states.
B) Trust creditors can never seize income from a spendthrift trust.
C) A settlor may provide, in a spendthrift trust, that the beneficiary cannot, by assignment or otherwise, impair her rights to receive principal or income.
D) All of these.

Question 59

A trust will fail for lack of:

A) consideration.
B) a trustee.
C) definite and specific property forming the trust corpus.
D) All of these.

Question 60

Which of the following will be acceptable as a witness to a will?

A) The testator's spouse.
B) The administrator of the estate.
C) The beneficiary of a testamentary trust.
D) The spouse of a beneficiary.

Question 61

Darrell executed a will fifteen years ago. Now he has changed his mind about how he wants his estate distributed and who he wants to appoint as executor. Discuss how Darrell may revoke his will.

Question 62

Dan, a widower, dies intestate. He leaves two surviving children, Joe and Carrie, and two grandchildren who are children of his deceased daughter, Debra. If Joe and Carrie each take one-third of his estate and the grandchildren each take one-sixth of the estate, this is described legally by the statement that:

A) lineal descendants of predeceased children take property per stirpes .
B) lineal descendants take the property per capita .
C) collateral heirs take the property per stirpes .
D) lineal descendants and collateral heirs take the property per capita .

Question 63

Under what conditions do courts impose a constructive trust?

Question 64

A trust must have which of the following?

A) Executor.
B) Corpus.
C) Testator.
D) All of these.

Question 65

Which of the following is untrue regarding the revocation of a will?

A) There can be a partial revocation.
B) An inadvertent destruction of a will acts as a revocation.
C) The execution of a second will does not of itself constitute a revocation of an earlier will.
D) Divorce does not ordinarily revoke a will.

Question 66

Clarence is the trustee of a trust. With $75,000 of his own money, Clarence purchases a parcel of real estate. Two months later, he sells the parcel to the trust for $150,000 and pockets the profit. Discuss the situation in terms of the duties and powers of the trustee.

Question 67

In 2004, Jack executed a valid will in which he left his entire estate to the Heart Fund. In 2012, Jack was declared incompetent and committed to an institution. At his death in 2018, his son, Brian, who was his sole survivor, contested the will claiming that Jack was obviously incompetent. Will Brian prevail with this argument? Explain.

Question 68

Which of the following would be charged to the life tenant's interest in the course of administering a trust?

A) Expenses of selling a trust investment.
B) The costs of establishing the trust.
C) Ordinary repairs to trust property.
D) Permanent improvements to the trust property.

Question 69

In 2016, Boyd created a trust that would become effective on his death. In the trust instrument, Boyd specified that all of the income from his stocks and bonds be used for the benefit of St. John's Hospital and indicated that his brother Chad should administer the trust.
a. What kind of trust is this?
b. What is Boyd with relationship to the trust?
c. What is the corpus of the trust?
d. What is Chad with relationship to the trust?

Question 70

Identify and describe the following types of wills.
a. Holographic
b. Nuncupative
c. Soldiers' and sailors' will

Question 71

The duties of a trustee are:

A) to carry out the purposes of the trust.
B) to act with prudence and care in the administration of the trust.
C) to exercise a high degree of loyalty toward the beneficiary.
D) All of these.

Question 72

Jameson, a trustee, fraudulently purchases property with trust funds and puts title in his own name. What type of trust will a court create?

A) Constructive trust.
B) Implied trust.
C) Express trust.
D) Resulting trust.

Question 73

Rules for the distribution of property in a situation involving intestate succession:

A) do not apply to property held in joint tenancy.
B) apply where the testator has failed to name an administrator.
C) prevent disposition of property by a valid will.
D) have no application to real estate owned by the decedent.

Question 74

For a memorandum to be incorporated into a will, which of the following conditions must be met? The memorandum must be:

A) in writing.
B) in existence when the will is executed.
C) adequately described in the will.
D) All of these.

Question 75

In the case of Keeney v. Keeney , the court found:

A) a constructive trust is created by equity regardless of the intention of the parties to create a trust where legal title to property is obtained through fraud or undue influence rendering it unconscionable for the holder of legal title to retain the property.
B) intention of the parties is the sole consideration in determining the existence of a trust.
C) the existence of a confidential relationship prohibits the trustee from seeking any personal benefit.
D) a totten trust is a tentative trust and the transfer of ownership becomes complete only upon the depositor's death.

Question 76

Darla dies intestate leaving two children, Brad and Christopher. Her daughter, Anna, died two years earlier. Anna had three children, Iris, Jeffrey and Keith. If Darla leaves an estate of $300,000, how much will Jeffrey's share be under the usual statutes of descent and distribution?

A) $0.
B) $60,000.
C) $33,333.
D) $100,000.

Question 77

Which of the following is true regarding property distribution upon a person's death intestate?

A) At common law, property lineally ascended to parents if there was no surviving spouse and there were no children.
B) Today, in all states, if there is a surviving spouse, he or she gets the entire estate.
C) Rules of descent vary widely from state to state.
D) If there are no children, the property automatically goes to the state.