How do I terminate a trust in Michigan?
A court may terminate the trust when the trustee and settlor agree. Fredricks v Near, 260 Mich 627, 245 NW 537 (1932). However, Michigan law does not permit the trustee and beneficiaries to agree to terminate trusts if to do so would violate a material purpose of the trust.
What is a settlement in trust law?
Settlements are when an individual ‘settles’ property (of any kind) on trust for a beneficiary (or a group of beneficiaries). The terms of the settlement are managed by a ‘trust’. They are sometimes called ‘lifetime trusts’ since the person making the settlement does so in their lifetime.
Whats the difference between a trust and a settlement?
Settlements may involve written agreements or deeds. Trusts are a common type but a settlement can also be a disposition, covenant or agreement. However, there doesn’t have to be a deed and so settlements can also include an unwritten arrangement or even a straightforward gift or transfer of property.
Can a trust be revocable under Michigan Law?
While a trust is revocable, rights of the trust beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the settlor. This does not apply to either of the following: (a) A trust created by the exercise of a power described in section 7820a.
How are trusts controlled in the state of Michigan?
Trusts are control under Michigan law by the Michigan Trust Code (MCT), MCL 700.7101 -.7913. Under the MTC the capacity required to create, amend, revoke, or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that required to make a will.
Who is liable in a trust in Michigan?
Trusts under Michigan Law. A trustee who does not know that a trust has been revoked or amended is not liable to the settlor or the settlor’s successors in interest, including the trust beneficiaries, for distributions made and other actions taken on the assumption that the trust had not been amended or revoked.
What are the reasons to remove a trustee in Michigan?
Under Michigan law, reasons justifying removal of a trustee are very specific. Beneficiaries can become displeased with how a trustee is performing any of a wide range of responsibilities that are part of the trustee’s fiduciary duty, which include:
What do you need to know about the Michigan Trust Code?
The Michigan Trust Code (MTC) provides the citizens of Michigan with the state’s ﬁ rst comprehensive codiﬁ cation of the law of trusts. The MTC is a uniquely Michigan document that draws from both the Uniform Trust Code and existing Michigan law to preserve long-established procedures, practices, and principles concerning trusts
How to settle a revocable trust after the Trustmaker dies?
The purpose of this guide is to provide a general overview of the six steps required to settle and then terminate a Revocable Living Trust after the Trustmaker dies. The first step in settling a Revocable Living Trust is to locate all of the decedent’s original estate planning documents and other important papers.
Can a nonjudicial settlement agreement be used in Michigan?
Nonjudicial settlement agreements cannot be used to achieve termination or modification of trusts. These actions remain subject to the provisions found in Part 4. The Code adopts Section 7111 with revisions intended to permit court review and approval of agreements initiated by trustees as well as beneficiaries.
What are the duties of a trustee in Michigan?
Part 8 sets forth the duties of the trustee and the trustee’s powers. Section 7801 (Duty to Administer Trust). Section 7801 describes the basic duties of the trustee: to administer the trust in good faith, in accordance with its terms and purposes, for the benefit of the beneficiary, and in accordance with the Michigan Trust Code.