Spain chatrondom - Anc liquidating trust

Upon the petition of all beneficiaries, the court may allow a modification or termination that is inconsistent with a material purpose of the trust if the reason for such modification or termination “substantially outweighs” accomplishment of the material purpose.

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Modification or termination of a noncharitable irrevocable trust may be accomplished with a single “consent modification” document if the trust’s grantor and all of its possible beneficiaries agree.

The grantor and beneficiaries may agree to take any action with respect to the trust’s terms – even if that action is oppositional to the trust’s purpose.

The court will likely approve such modification to the trust as meeting Nephew’s medical needs substantially outweighs the interest in funding Nephew’s first home purchase.

While court-approved modification or termination is smoothest when all trust beneficiaries agree to the proposed action, unanimous consent is not necessary.

Husband, Wife and their children may agree to change the successor Trustee to Wife’s sister.

Such straightforward modification is permissible regardless of the proposed changes or the number of beneficiaries involved.

Keep in mind, however, that every beneficiary who may receive trust property now or at any time in the future – no matter how remote the possibility – must consent to the proposed action.

If even a single potential beneficiary refuses, this consent modification procedure is unavailable.

Here, all of the beneficiaries – again, no matter how remote – petition the Superior Court to approve their proposed action.

Unlike a consent modification, however, a court-approved modification or termination generally may not frustrate a “material purpose” of the trust.

(When a minor or unborn person is a beneficiary, consent on the beneficiary’s behalf may often be given by a parent of the minor or a lineal ancestor of the unborn beneficiary.) Further, as the consent of the grantor and all beneficiaries is necessary, a consent modification is possible only while the grantor is alive.

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