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12/12/2010
David M. Frees, III
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Pennsylvania Trustee Mistake # 7 - Failure To Properly Reform, Amend, or Terminate



Pennsylvania Trustee Mistake Part 7

Failure To Properly Reform, Amend, or Terminate When Needed

Under prior law in Pennsylvania, non-charitable irrevocable trusts, like a small family trust, may be modified or terminated for any reason as long as the settlor and all beneficiaries agree. Under the Uniform Trust Act, that process of modifying or terminating a trust privately and without court approval may be more complicated. As a trustee the more information you give everyone and the more you keep them involved the more likely whatever changes you see fit will be welcomed with consent by either the trust beneficiaries or the court.

  In some cases when the settlor is not able to give consent, he or she has passed away,or beneficiaries cannot be determined (like unborn grandchildren) then the court will have to approve with everyone's consent. Be aware the court will also approve without everyone's consent if the non-agreeing parties interests are adequately protected despite the proposed change.  A trust may also be terminated if the trust does not achieve any material purpose.

In short, if a trust needs to be modified or terminated, you need to make sure the settlor and all the beneficiaries agree and if they do not you have to get court approval to terminate without everyone's consent. Consider having a consultation with legal counsel to make sure that you get off on the right foot and start following the trustee rules from the beginning of the trust administration. The better relationship you have formed with the beneficiaries, by doing things like keeping them up to date on the trusts assets, the better chance you have to get everyone's consent when it comes time for you to change or terminate the trust document.

See all ten of our articles on How To Avoid The Most Common Mistakes Trustees Make:

Avoiding Trustee Mistakes No. 1: Trustees Failing To Understand The Trust Language

Avoiding Trustee Mistakes No. 2: Trustees In Trouble Making Early Distributions

Avoiding Trustee Mistakes No. 3: Trustees Failing To Follow The Prudent Investor Rule

Avoiding Trustee Mistakes No. 4: Trustees Failing To Follow The Uniform Trust Act

Avoiding Trustee Mistakes No. 5: Trustees Failing To Follow The Principle And Income Act

Avoiding Trustee Mistakes No. 6: Trustees Failing To Communicate Properly

Avoiding Trustee Mistakes No. 7: Failing To Properly Reform, Amend, Or Terminate

Avoiding Trustee Mistakes No. 8: Failing To File Tax Returns Or To Seek Professional Assistance

Avoiding Trustee Mistakes No. 9: Failing To Understand The Role Of Multiple Trustees

Avoiding Trustee Mistakes No. 10: Trustees Failing To Do The Job



David M. Frees III
dfrees@utbf.com
610-933-8069
Representing trustees and executors


Category: Executor, Trustees and Probate

Labels: living trust mistake Malvern trust lawyer PA trust PA trust attorney Pa trust lawyer PA trustees PA trusts Pennsylvania living trusts Pennsylvania trust Pennsylvania trust attorney Pennsylvania trust lawyer pennsylvania trustee pennsylvania trustee mistake Pennsylvania trustees Phoenixville estate lawyer protecting living trust trustee liability trustee mistake West Chester trust lawyer


David M. Frees IIIDavid Frees is a probate, trust and estate lawyer, who focuses his practice in the area of Trusts, Estate, Estate Administration, Asset Protection, and has lawyers in his three offices in Malvern, Phoenixville, and West Chester who also work in the areas of estate planning and elder law.

David Frees can be reached at 610-933-8069.  If David is not immediately available his assistants will get you an appointment, or a call time.


* Please note, that in Pennsylvania, there are no specialties, or sub specialties in the practice of law.  Once a lawyer passes the bar, with very few exceptions, they are authorized to practice in any area of the law and anywhere in the state of Pennsylvania.  Any reference to David Frees as a probate, trust, estate planning lawyer, are really references to the focus of his practice.





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