Legal Trusts, Wills & Probate 1 — Questions and Answers
Question 1: What is the legal term for the person who creates a trust and transfers property into it?
- Beneficiary
- Trustee
- Grantor (Correct answer)
- Executor
Correct answer: Grantor
The grantor (also called settlor or trustor) is the person who creates a trust and transfers assets into it for the benefit of the beneficiaries.
Question 2: Which type of will is entirely handwritten and signed by the testator, typically requiring no witnesses in jurisdictions that recognize it?
- Attested will
- Holographic will (Correct answer)
- Nuncupative will
- Codicil
Correct answer: Holographic will
A holographic will is entirely in the testator's own handwriting and signed by them; many states recognize such wills without requiring witness signatures.
Question 3: What is 'intestate succession'?
- A succession plan for business continuity
- The statutory distribution of assets when a person dies without a valid will (Correct answer)
- A tax imposed on inherited estates
- The court process for challenging a will
Correct answer: The statutory distribution of assets when a person dies without a valid will
Intestate succession refers to the state statutory rules that govern how a decedent's estate is distributed when they die without a valid will.
Question 4: What is the primary function of an executor named in a will?
- To inherit the largest share of the estate
- To preside over probate court proceedings
- To gather assets, pay debts, and distribute the estate according to the will's terms (Correct answer)
- To draft any amendments to the will after the testator's death
Correct answer: To gather assets, pay debts, and distribute the estate according to the will's terms
An executor (personal representative) is appointed to administer the estate: marshaling assets, satisfying debts and taxes, and distributing the remainder to beneficiaries.
Question 5: Which type of trust is created within a will and only becomes operative upon the testator's death?
- Inter vivos trust
- Charitable remainder trust
- Testamentary trust (Correct answer)
- Spendthrift trust
Correct answer: Testamentary trust
A testamentary trust is established by the terms of a will and comes into existence only at the testator's death, then passing through probate before funding.
Question 6: What is a 'pour-over will'?
- A will that directs all remaining probate assets into a pre-existing trust at the testator's death (Correct answer)
- A will that splits assets proportionally among multiple named beneficiaries
- A will executed in a foreign jurisdiction for property located abroad
- A will that designates funds exclusively for charitable organizations
Correct answer: A will that directs all remaining probate assets into a pre-existing trust at the testator's death
A pour-over will directs that any assets not previously transferred to a living trust during the testator's lifetime 'pour over' into that trust at death to be administered under its terms.
Question 7: What is 'ademption' in the law of wills?
- The formal witnessing and signing ceremony for a will
- The failure of a specific bequest because the testator no longer owns the designated property at death (Correct answer)
- The addition of a supplementary provision (codicil) to an existing will
- The legal process of revoking a previously executed will
Correct answer: The failure of a specific bequest because the testator no longer owns the designated property at death
Ademption occurs when a specific bequest fails because the testator disposed of or no longer owns that specific property at the time of death, leaving the beneficiary with nothing.
Legal Trusts, Wills & Probate 1
What is the legal term for the person who creates a trust and transfers property into it?