734-359-7018
Now Accepting New Clients!
Blog

WILLS/TRUSTS 14: The trust gave the mother great discretion to disburse property as she saw fit.

This case involves a trust created by the father in 1992. He died in 1994, leaving behind his wife and mother of their four children: son M, son T, daughter S, and daughter M. After his death, his assets (mostly real estate) flowed into two sub-trusts: the marital trust and the residuary trust. Both were intended to provide for the mother for the remainder of her life. The mother and daughter M were designated as co-trustees for the sub-trusts. When the mother passes away, any remaining assets will flow into the children’s trust to be divided equally between the children.

The marital and residuary trusts grant the mother prodigious power and authority to use and disburse of trust assets. The mother may request distributions without limitation and for any reason and may exhaust the trust principals to provide for her needs. She may disburse of trust assets during her lifetime, favoring one child over another in doing so. The trust also shelters the mother from accountability or liability to any of her children for the manner in which she, in good faith, exercises her powers and discretions; her judgment with respect to all matters shall be binding and conclusive upon all her children.

In 2016, Petitioners asserted that the mother and daughter M breached their duty of loyalty by giving son M an unequal share of property from the trust and by depleting the trust for purposes other than the mother’s care.

Petitioners further contended that son M had unduly influenced the mother into giving him control over the trust, which he used as his personal piggy bank. They alleged that son M had usurped the role of trustee by listing himself on the trust’s bank accounts. Petitioners presented evidence that son M managed the daily business of the trust properties and used trust funds to manage his separately owned properties.

Respondents retorted that the language of the trust gave the mother great discretion to disburse property as she saw fit and even to designate son M as a business representative.

A presumption of undue influence arises when there is evidence of (1) a confidential or fiduciary relationship between the grantor and a fiduciary, (2) the fiduciary or an interest he represents benefits from a transaction, and (3) the fiduciary had an opportunity to influence the grantor’s decision in that transaction.

When the presumption is established, the party seeking to enforce the trust must offer other evidence to rebut the presumption.

In this case, not only did the probate court prematurely dismiss petitioners’ undue influence claim without a motion and without a hearing, but the court also improperly dismissed the case in the face of conflicting evidence that created a genuine issue of material fact.

The court of appeals vacated the probate court’s summary dismissal of petitioners’ undue influence claim and on remand order the probate court to conduct the remainder of the proceedings on the record.

In addition to drafting wills, trusts and other estate planning instruments, Aldrich Legal Services can review your existing estate planning documents. If your family structure has changed due to a second marriage, adoption or divorce, you may need to update your estate planning documents to reflect your current wishes and needs. We want you to be certain that your estate plan accomplishes what you want it to.

Contact Aldrich Legal Services

Basic responsibilities of an executor

Originally posted on 01/11/2017 The emotional toils of dealing with the death of a loved one can be considerably difficult. Nevertheless, perseverance is paramount; especially if you are appointed to be an executor to one’s...

What you need to compliment your will

Originally posted on 02/08/2017 Making end-of-life plans usually end with a will, but they shouldn't. Some believe that simply having a will is enough. However, this post will briefly explain how having other estate planning...

The benefits of home health care providers

Originally posted on 03/22/2017 As we get older or suffer an injury, we need a little extra help. Home health care providers or caregivers can provide the assistance needed to handle your or your loved one's health and safety...

What to know about bail conditions

Originally posted on 03/06/2017 If you have been arrested and are being held on the suspicion that you have committed a particular crime, chances are that the only thing you are thinking about is getting out of jail as soon as possible and...

College students and estate planning

Originally posted on 12/16/2016 With college semesters starting up in Michigan, it may not be so easy to get college students to think responsibly. This time can be especially tough with the need of moving back to school and getting...

Three reasons to put a power of attorney in place

Originally posted on 11/08/2016 While no one wants to think of the unfortunate possibility of being incapacitated or of a time when we can't handle our own affairs, this circumstance is a real possibility. If something happens and this...

How to approach parents about estate planning

Originally posted on 12/09/2016 Family forms a strong foundation for many people's first and most intimate community. It is important to strengthen these first relationships so even uncommon questions become natural. For those...

PROBATE 44: Petition for Mental Health Treatment

Michigan’s Mental Health Code governs the civil admission and discharge procedures for a person with a mental illness. Specifically, MCL 330.1434 sets forth the procedure and content requirements for a petition for mental health treatment.

Should you get your criminal record expunged?

Originally posted on 04/12/2017 If you have been convicted of a crime, have served your sentence, and have followed all court recommendations, you should be able to put your past behind you and move on with life. Moving forward is critical...

Choosing the right executor for an estate

Originally posted on 05/28/2017 When people are thinking about planning their estate, they often think about trying to minimize the estate tax, keeping their will updated, and keeping items out of probate court; however, there is another...

Understanding how the Miranda warning works

Originally posted on 11/25/2016 Michigan residents who have seen television police shows or movies involving law enforcement have no doubt watched many dramatic scenes with officers quoting something to the effect of, "You have the...

Don't let a bad decision, unfair contract, or a messy divorce get in the way of a promising future!
Contact the experienced team at Aldrich Legal Services today to schedule your free initial
consultation
and secure reliable and trustworthy representation today!
Get the Help You Need From a Team You Can Truly Count On: (734) 404-3000
734-237-6482
734-366-4405