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.