Question 1
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1. What interests, if any, does Dave have in the trust {{assets}}?
Trust
A valid trust requires a (1) {{lawful}} purpose, (2) a Trustor the person setting up the trust, a (3) trustee who is the legal owner who acts for the benefit of the trust beneficiaries, and (4) beneficiaries to enforce the trust, as well as the trust res which is {{property}}.
Here[User5] , the facts indicate that a valid, revocable inter vivos trus was created.
Pour over Will
A[User6] [User7] pour over will is valid as long as it is in existence at the time the trust is created. Incorporation by reference is valid Sam (S) established both the trust and will at the same time and the trust mentions the will which is required to be considered part of the estate left by the Trustor. Thus, this is a valid way to marry the will and the trust. Acts of lndependant Lega Significance[User8] this refers to things that happened in S’s life and not necessarily having any testamentary meaning. These occurences may be referred to an become a part of the will and trust. Here, naming his cousin Tara (T) to be his successor trustee, should S die or become incapacitated. S likely trusted T to do the right thing because of his interactions with her in life, nothing to do with death[User9] .
Pretermitted Child
A[User10] child automatically takes from his mother at death however; with fathers sometimes there are other situations that warrant other options[User11] .
Here[User12] , Dave (D) was adjudicated S’s child after S’s death. S did not know of his existence in his life time. There are three ways a child may take from a father, 1) father holds the child out as his own, 2) father acknowledges the child in his life time or, 3) by adjudication[User13] . Here[User14] [User15] , Dave (D) would be considered pretermitted because S created his will S was not aware of D’s existence. A pretermitted child will take his rightful share, first from the residual if that is not sufficient, from the other bennies Ann (A), Beth (B), and Carol (C[User16] ).
The[User17] amount should be 1/4 from each child, this will take care of D’s share[User18] .
2. Are Beth and Carol likely to be successful in terminating the trust[User19] ?
Trust Termination
A trust may be terminated when all the beneficiaries agree to terminate and as long as the trust purpose is not frustrated[User20] .
Here[User21] , it will be difficult because S directed the trustee to distribute the trust annually, in egual share to each of his three children (now four) until the death of last of his children. So it appears that S wanted to provide for the children throughout their lifetimes with a financial benefit. I do[User22] not know if the court would be willing to terminate the trust now because I believe it would frustrate the trust purpose[User23] . If is terminates now there would be no other trust funds upon which the children could depend on if some sort of financial hardship arose. Band C would argue that it has already happened with A receiving more of the trust res than them because of her illness and inability to work. The trust has been distributed like a Discretionary Trust because T has all the discretion and she is distributing the funds to whom she (T) believes should have it. These are facts however; the judge will more than likely appoint a new trustee to alleviate the problem with T’s administration of the trust. Also, A and D will probably not agree to have the trust terminate[User24] [User25] .
3. Are Beth and Carol likely to be successful in suing Tara[User26] ?
Duty of Loyaty[User27]
A trustee owes a duty of loyalty to all trust beneficiarys, she cannot act soley for the benefit of one. Here, T although her heart was in the right place breached this duty when she began to distribute all the trust income to A who is sick. Because of the familial background with everyone, T believed she was doing the right thing because of A’s health issues. However, T in turn breached her duty of loyalty to Band C and now D. S did not place any stipulations in the trust which stated for T to help the sick child the most. Thus, T breached her duty of loyalty to the beneficiaries[User28] .
Duty of Care
A trustee owes a duty of care to treat the trust property the way she would treat her own property[User29] .
T breached this duty as well when she concentrated on A’s situation to the detrement[User30] of the making the trust property grow. Once T realized she felt the way she did regarding A, she should have resigned her administration. Now T may be liable personally because chances are B, C, and D2 will not set aside the breach or accept what has happened[User31] .
Thus, Band C will be successful in suing T[User32] [User33] [User34] [User35] [User36] .
[User1]Have a heading for each question that mirrors the call of the question. Number the questions. For the bar grader, this will help in knowing which question the examinee is on. For the examinee, this will remind the examinee what question the examinee has to answer.
[User2]When giving rules with several elements, number the elements to make it easier to read, and to create a checklist for yourself when you are applying the elements to the facts so you do not forget an element.
[User3]It may not be necessary to use up time to give the rules for this issue because it is given in the facts there is a valid trust so no analysis is needed on this issue, but there should be an issue on this topic to at least state there is a valid trust because in order to analyze the other issues in the question, a valid trust has to first be established.
[User4]These rules are not complete if it was necessary to give the rules: Under California law, a valid inter vivos trust requires: (1) settlor with capacity (2) present intent by the settlor to create a trust, (3) transfer of property to the trust, (4) an ascertainable beneficiary to enforce the trust, (5) a lawful trust purpose that is not contrary to public policy, and (6) an appointed trustee. A California court, however, will not invalidate an otherwise valid trust for lack of a trustee.
[User5]Break down each issue to 3-4 paragraphs, with one paragraph for each of IRAC. Breaking down keeps paragraphs short. Psychologically, the grader pays more attention to the early parts of paragraphs. When paragraphs are long, you may not be awarded points if a grader never gets to the end. With a paragraph for each of IRAC, the grader sees you (1) catch the issue, (2) know the rules, (3) identify the facts to apply the rules, and (4) have a conclusion.
In the first paragraph, give the issue in the first sentence, unless the issue is already reflected in the heading. If the issue is reflected in the heading, you can dispense with an issue statement. Detail the rules in the same paragraph without mixing in any facts. Define all legal terms. In the second paragraph, apply the rules to the facts. Signify the fact discussions with “Here” or “In this case.” Make a third paragraph for the conclusion, even if it is one sentence. Signify the conclusion with “Thus” or “Therefore.” After concluding, do not analyze further. If you are not finished discussing, do not use “Thus” or “Therefore.” Put all the analysis before the conclusion paragraph. Put the conclusion at the end not beginning. Conclusions at the end do not give the grader a chance to prejudge your issue spotting, rules, or facts analysis. If there are several elements, put a conclusion at the end of each element, and a final summary at the end of the last element to provide an overall conclusion on the question asked.
[User6]It may not be necessary to use up time to give the rules for this issue because it is given in the facts there is a valid pour-over will so no analysis is needed on this issue, but there should be an issue on this topic to at least state there is a valid pour-over will because in order to analyze the other issues in the question, a valid will has to first be established.
[User7]These rules are not accurate or complete if the rules were required for this issue: A testator may by will bequeath estate assets to an inter vivos trust, provided the will identifies the trust, and the provisions for bequeath are set forth in a written instrument executed before or currently with the testator’s will execution.
[User8]Off track discussions.
[User9]Too much time is used on this issue. It is given in the facts that there is a valid pour-over will so simply state:
Here, the facts stated that when Sam established the trust, he executed a valid will pouring over all his additional assets to the trust. There were no will validity issues.
Thus, there was a valid pour-over will.
[User10]Missing the rules:
If a testator fails to provide in a will for a child born after will execution, the omitted child receives that amount the child would have received if the testator died intestate. Courts are likely to resolve an ambiguity in a will in favor of an omitted child claimant.
[User11]First analyze the facts under the general rule before going to the exceptions: Here, Sam died two years after executing a valid will. Within two months of Sam’s death, Dave began litigation to prove he was a child of Sam’s although Sam had never known of his existence. Dave was age 25 at the time of Sam’s death.
Though the court determined Dave was in fact Sam’s child, Dave was not born after the execution of Sam’s will.
[User12]Use IRAC format. Separate each part of IRAC into different paragraphs.
[User13]Improper organization: These rules are exceptions to whether the omitted child takes the intestate share. They should be discussed after concluding Dave is an omitted child.
[User14]Make a separate heading when discussing the exceptions. This examinee applies the law correctly for the exception for the omitted child issue, but does not give the rules on it first: However, there is an exception to this rule: a child omitted because the testator believed that the child was dead or non-existent is considered an omitted child, regardless of when the child was born.
[User15]Put all the rules at the top in the first paragraph, not inserted in the middle of the facts analysis for the first time. Explain what the rules are to the bar grader first so the grader knows the state of the law.
[User16]Discussions are conclusory. Make a separate heading to discuss the distribution.
[User17]Conclusion should be in a separate paragraph to show you are going back to answer the call of the question. If you put it in the paragraph for omitted child issue, the bar grader will think that this is an analysis or conclusion part of the omitted child issue, not an answer to the call of the question.
[User18]Incomplete analysis on distribution issue: In this case, Sam died as a widower so his assets would pass intestate to his issue in any generation, which at the time of his death were Ann, Beth, Carol and Dave.
Per Capita
The rule is that is if all takers under intestate succession are equally closely related to the decedent, then they take per capita. In this case, Ann, Beth, Carol and Dave are equally closely related to Sam (i.e. they are all his children), so they would take per capita.
With 4 descendants taking per capita, each issue would take one-fourth of Sam’s estate.
As such, Dave would be entitled to one-fourth of both Sam’s assets owned at the time of his death and the assets held in any revocable inter vivos trust at the time of his death.
Dave Is Entitled to One-Fourth of the Trust Assets
Therefore, Dave would be entitled to one-fourth of the assets held in the revocable inter vivos trust at the time of Sam’s death.
[User19]Mirror the call of the question. Number the questions.
[User20]Incomplete on rules: Under California law, a revocable inter vivos trust becomes irrevocable when a settlor dies. However, there are four ways an irrevocable trust can terminate prematurely before the time set for termination in the trust instrument: (1) settlor and all beneficiaries agree to terminate, (2) all the beneficiaries agree to terminate and all the material purposes have been accomplished, (3) by merger, or (4) by operation of law (purpose impossible, illegal or completed).
[User21]Use separate paragraphs for each part of IRAC to allow the grader to see the IRAC, and to allow the grader to easily give points while skimming the paper.
[User22]Do not insert personal opinions.
[User23]Examinee on track in knowing what the trust purpose is and the time set for termination under the trust.
[User24]Examinee does not apply the law on the possible ways to terminate a trust. Make a heading on each of the possible ways to terminate a trust and apply the law to the facts:
Settlor & All Beneficiaries Agree
Here, since Sam died, he could not agree with all beneficiaries to terminate the trust early.
Therefore, the first option does not apply.
All Beneficiaries Agree & All Material Purposes Accomplished
“All” beneficiaries consists of not only all existing beneficiaries, but also potential beneficiaries, some of which may not be born or otherwise ascertainable.
Here, Ann did not agree to the termination, but even if she did, the consent of all beneficiaries was not possible because the trust provided for trust assets remaining after the death of the three named children to be distributed to Sam’s then living descendants, who were not yet ascertainable.
Furthermore, even if consent of all the beneficiaries could be obtained, a court order terminating the trust would defeat the trust purpose, which was to provide income to Ann, Beth, and Carol for life and then distribute any remaining assets after their deaths to Sam’s then living descendants by representation.
Thus, the second option does not apply.
Merger
If the sole trustee becomes the sole beneficiary, then the trust interests “merge” and the trust terminates.
In this case, however, Tara is the sole trustee but she is not a beneficiary of the trust, let alone the sole beneficiary.
As such, the third option does not apply.
Operation of Law
In California, termination by operation of law may occur when the: (1) trust purpose has been completed, (2) trust purpose becomes unlawful, or (3) trust purpose has become impossible (e.g. property ceases to exist or the market value of the principal has become so low in relation to the cost of trust administration).
In this case, the trust purpose was not completed, illegal or impossible so a court would not be allowed to terminate this trust by operation of law.
Thus, the four option does not apply either.
In conclusion, Beth and Carol would not succeed in terminating the trust.
[User25]Missing conclusion that answers the call of the question.
[User26]Mirror the call of the question. Number the question. Let the bar grader know which question you are on.
[User27]Issue is not raised by the facts.
[User28]Missed issue:
Trust Modification
Under California law, on petition by a trustee or beneficiary, a court may modify the administrative or dispositive provisions of a trust if, owing to circumstances not known to and not anticipated by the settlor, the continuation of the trust under its terms would defeat or substantially impair the accomplishment of the trust purposes. If necessary to carry out trust purposes, a court may order the trustee to do acts not authorized or prohibited by the trust.
Here, upon Sam’s death, Tara was the successor trustee of Sam’s trust. Sam directed the trustee to distribute the trust property as explained above. Tara distributed nearly all of the trust income to Ann, but little to Beth and Carol, because Ann had medical problems and could not work, while Beth and Carol had sufficient assets of their own. It appeared Ann’s medical problems were circumstances that Sam did not anticipate, but neither Tara nor a beneficiary sought a court order to modify the trust, and the trust administration by Tara defeated or substantially impaired the trust purposes explained above.
Thus, Tara improperly modified trust provisions without a court order, and against trust purposes.
[User29]Incomplete on rules:
A trustee is in a fiduciary relationship to the trust and its beneficiaries. The trustee must exercise that degree of care, skill, and caution exercised by a reasonably prudent person in managing the person’s own property. If the trustee has greater or special skills, the person will be held to a higher standard.
[User30]Watch out for unnecessary spelling errors that may distract the bar grader.
[User31]Missing conclusion on duty of care issue.
[User32]Analysis off track and does not apply the rules:
Here, Tara, just a cousin to Sam, most likely did not have special skills in trust administration, so she would likely be held to the reasonably prudent person standard. However, nothing in this case seems to indicate that Tara breached her duty of care as trustee.
She did not distribute the trust income equally as she was instructed, but this is not a breach of the duty of care.
[User33]This is a conclusion to the call of the question – put it in a separate paragraph from the Duty of Care issue. A conclusion to the call of the question should be in its own paragraph.
[User34]Actual Score: 55
Issues: Missing at least 4 major issues. Read the fact pattern slowly and carefully, circle all the descriptive words you see (adjectives, adverbs, etc.). Each word is significant and is to trigger an issue. For example, people’s ages, years, dollar amounts, etc. – each of these facts is to mean something. You have to ask yourself, why you are told someone is a “cousin”, “widower”, etc. When you are circling the descriptive words try to figure out what issues each fact triggers.
Rules: Incomplete. In order to pass the bar exam, you need a good foundation on the law. Understand the law, not just memorize it.
Analysis: Off track. Apply the rules to the facts. Do not insert personal opinions.
Organization: Use IRAC format.
[User35]Examinee does not answer the call of the question.
[User36]Missed issues:
Duty to Administer the Trust in Accord with Its Terms
A trustee has a duty to comply with the terms of the trust agreement but cannot follow such instructions blindly.
In this case, Sam directed Tara to distribute the income from the trust annually in equal shares to each of his three children. Tara, however, ignored these instructions and distributed nearly all of the trust income to Ann, and little to Beth and Carol. Furthermore, nothing seems to indicate that Tara was justified in not following these instructions (i.e. cannot follow such instructions blindly). Sam wanted to take care of all three of his children and nothing in the facts indicates that Sam would have wanted Tara to ignore these instructions if one of his children were to experience “very serious” medical problems.
As such, Tara has clearly violated the duty to administer the trust in accord with its terms.
Duty to Act Impartially Between Beneficiaries
Under California law, if a trust has two or more beneficiaries, the trustee has a duty to deal impartially with them and shall act impartially in investing and managing trust property, taking into account any differing interests of the beneficiaries.
Here, Tara distributed nearly all of the income to Ann, and little to Beth and Carol. She did not divide the income equally among the named children.
Thus, Tara did not act impartially between beneficiaries.
Duty to Inform & Account
A trustee must disclose to beneficiaries complete and accurate information about the nature and extent of trust property, and periodically account for actions taken on behalf of the trust so the trustee’s performance can be assessed against trust provisions. The trustee must identify and disclose possible breaches of trust provisions to beneficiaries.
Here, Tara did not follow trust provisions in her administration of Sam’s trust for three years. She did not provide the beneficiaries with complete and accurate information on her distribution of trust property, or identify possible breaches of trust provisions.
Thus, Tara breached her duty to inform and account.
In conclusion, Beth and Carol would likely succeed in suing Tara.
[[assets]]Have a heading for each question that mirrors the call of the question. Number the questions. For the bar grader, this will help in knowing which question the examinee is on. For the examinee, this will remind the examinee what question the examinee has to answer.[[assets]] [[lawful]]When giving rules with several elements, number the elements to make it easier to read, and to create a checklist for yourself when you are applying the elements to the facts so you do not forget an element.[[lawful]] [[property]]It may not be necessary to use up time to give the rules for this issue because it is given in the facts there is a valid trust so no analysis is needed on this issue, but there should be an issue on this topic to at least state there is a valid trust because in order to analyze the other issues in the question, a valid trust has to first be established.[[property]]
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