Trust Administration & Probate Filing Flashcards

The doctrine of cy-pres allows a court to modify a charitable trust when:

Answer: The specific charitable purpose becomes impossible, impractical, or illegal

Cy-pres permits a court to redirect a charitable trust to a purpose as near as possible to the original intent when the stated purpose can no longer be fulfilled.

A Durable Power of Attorney for financial matters differs from a standard Power of Attorney in that it:

Answer: Remains effective upon the principal's incapacity

A durable power of attorney contains specific language making it survive or spring into effect upon the principal's incapacity, unlike a standard POA which terminates at incapacity.

In probate administration, which step must occur BEFORE the personal representative files a petition for final distribution?

Answer: Paying or providing for all valid debts, taxes, and administration expenses

All valid debts, claims, and taxes must be satisfied or adequately reserved before the personal representative can seek court approval for final distribution to beneficiaries.

Under the Uniform Trust Code, the duty to inform and report requires a trustee to proactively notify beneficiaries of:

Answer: The existence of the trust and their right to request information

The UTC requires trustees to notify qualified beneficiaries of the trust's existence and their right to receive information, enabling beneficiaries to protect their interests.

A generation-skipping transfer (GST) tax is triggered when assets pass to a 'skip person,' defined as someone who is:

Answer: Two or more generations below the transferor

A skip person is a natural person assigned to a generation that is two or more generations below the transferor, such as a grandchild.

Which document is filed with the probate court to formally close an estate after all assets are distributed?

Answer: Final Account and Petition for Discharge

A Final Account and Petition for Discharge summarizes all estate receipts, disbursements, and distributions, and asks the court to release the personal representative from further liability.

A trustee's delegation of investment management to a professional investment advisor under the Uniform Prudent Investor Act requires the trustee to:

Answer: Exercise care in selecting the agent, establishing scope, and monitoring performance

Delegation is permissible under UPIA if the trustee prudently selects the agent, defines the scope of authority in writing, and periodically monitors the agent's performance.