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PROBATE 16: Can trustee change the principal place of administration of the trust?

The probate court determined that it lacked jurisdiction to hear the petition because the situs of the trust had been transferred to Florida.

In 2001, Elizabeth created the Elizabeth Trust and named her daughters, appellees Patricia and Connie, co-successors. In 2004, Elizabeth executed a durable power of attorney for finances and named Patricia as her agent. In 2013, Patricia, as agent for Elizabeth, resigned Elizabeth as trustee of the Elizabeth Trust and assumed duties as co-successor trustee of the trust with Connie. Elizabeth died in 2014.

In January 2015, Patricia gave written notice to beneficiaries of the Trust that she was changing the situs of the Trust from Michigan to Florida. Appellant apparently received the notice, and sent an objection to the situs change, but sent it to the wrong address. Patricia represents that she did not receive appellant’s objection. The record indicates that no other beneficiary objected to the transfer. The Trust has been continuously administered in Florida by Patricia since 2015.

In 2017, appellant filed a petition to remove Patricia as trustee.

After reviewing the Trust agreement and Patricia’s 2015 notice of the situs change, the court ruled that it indeed lacked jurisdiction in Michigan to hear appellant’s petition because Patricia had the authority to transfer the situs of the Trust at her discretion.

Probate courts are courts of limited jurisdiction. MCL 700.7203(1) grants Michigan probate courts broad and exclusive jurisdiction over proceedings in this state brought by a trustee or beneficiary that concern the administration of a trust. However, MCL 700.7205(1) provides: If a party objects, the court shall not entertain a proceeding under section 7203 that involves a trust that is registered or that has its principal place of administration in another state.

The requirements of MCL 700.7108(3) and (5), governing a transfer of the principal place of administration of a trust, apply only if a trust is silent as to how a trustee may change the principal place of administration of the trust. Because the Trust agreement governs the change of situs, the probate court was correct to conclude that Patricia was not required to provide the Trust’s beneficiaries notice of her intent to move the Trust’s situs in accordance with the Michigan Trust Code. Appellees were empowered by the Trust agreement to change the principal place of administration of the trust to Florida at their sole discretion.

In addition to drafting wills, trusts and other estate planning instruments, Aldrich Legal Services can review existing estate planning documents. To schedule a free consultation with an experienced probate and estate administration lawyer at our firm, contact our law office in Plymouth, Michigan. We are also available to meet with clients in Ann Arbor by appointment.

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REAL ESTATE 36: Plaintiff argued that her claim was not time-barred because it did not accrue until the grandmother’s death.

Plaintiff’s interest in the subject property is best characterized as a remainder estate, because her right to possession of the property was postponed until the occurrence of a specific contingency, that being the deaths of the grandparents. Plaintiff pursued this action within the 15-year limitation period; accordingly, this action is not barred by MCL 600.5801(4).

LITIGATION 6: The terms of the agreement prevails over the course of performance.

The trial court determined that under the UCC, the express terms of the parties’ agreements prevailed over the course of their performance and course of dealing. Although a course of performance may show that parties have waived a specific contractual term under MCL 440.1303(6), the statute does not similarly provide that a course of dealing may demonstrate waiver.

PROBATE 27: Petitioner filed a petition for mental-health treatment.

In support of the allegations, petitioner attached clinical certificates from a physician and a psychiatrist who observed respondent at the hospital. Both doctors diagnosed respondent with bipolar disorder, determined that she displayed a likelihood of injuring herself and that she did not understand the need for treatment, and recommended a course of treatment that consisted of 60 days of hospitalization and 90 days of outpatient care.

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FAMILY LAW 32: Trial court committed error in failing to address whether there was an established custodial environment.

On appeal, plaintiff argues that the trial court failed to make any findings regarding (1) the child’s established custodial environment, (2) the child’s best interests regarding the grant of primary physical custody to defendant, (3) the child’s best interests with respect to parenting time, and (4) the child’s best interests pertaining to the parties’ dispute over daycare.

PROBATE 25: Daughter removed as personal representative of the estate.

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REAL ESTATE 32: Plaintiffs and defendants executed a second easement.

Plaintiffs requested that the trial court, either through reformation of the First Easement or interpretation of the Second Easement, quiet title in favor of plaintiffs and declare them to be the owners of an easement to access Lake Superior through the ravine on defendants’ property, enjoin defendants from interfering with their use of the easement, and order compensation for damages to the stairs.

LITIGATION 4: Plaintiff claimed installation of hardwood flooring breached the condo bylaws.

Defendants completed the project. Plaintiff did not pay for any of the costs of the project. Defendants moved to compel plaintiff to pay one-half of the costs under the agreement. Plaintiff responded that defendants had materially breached the agreement in several ways, including by denying her the right to supervise the project, by refusing to give her an installation schedule, and by starting work before plaintiff approved of the start date.

FAMILY LAW 30: Discretionary trust assets cannot be reached to satisfy claims for child support and alimony.

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The court ruled that title to the land prevails and that once the deed was signed, the property became the undivided whole interest for both the decedent and appellee and became appellee’s property upon the decedent’s death. Consequently, the court concluded that the prenuptial agreement did not have any impact on the property rights of appellee in this case.

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