MD Bar Wills Trusts and Estates 3

Question 1

Under the Maryland Trust Act, a trust is revocable by the settlor unless what is true?

Accepted Answer

The terms of the trust expressly provide that it is irrevocable

Answer

Following the Uniform Trust Code approach, the Maryland Trust Act makes trusts revocable by default unless the instrument expressly states the trust is irrevocable.

Question 2

Which element is NOT required to create a valid private express trust in Maryland?

Accepted Answer

Consideration paid by the beneficiaries

Answer

A trust is a gratuitous transfer requiring intent, property, and ascertainable beneficiaries, but no consideration.

Question 3

A Maryland spendthrift clause is generally ineffective against which claimant?

Accepted Answer

A child with a valid claim for child support

Answer

Even with a spendthrift provision, exception creditors such as those holding child or spousal support judgments can reach the beneficiary's interest.

Question 4

A Maryland charitable trust to fund a specific hospital fails because the hospital closes. What doctrine may the court apply to redirect the funds?

Accepted Answer

Cy pres, applying the funds to a similar charitable purpose consistent with the settlor's intent

Answer

Under cy pres, when a particular charitable purpose becomes impossible or impracticable, the court may direct the property to a charitable purpose that approximates the settlor's general charitable intent.

Question 5

A trustee of a Maryland trust buys trust real estate for himself at fair market value with full disclosure to no one. A beneficiary sues. What is the likely result?

Accepted Answer

The sale is voidable as self-dealing regardless of fairness

Answer

Self-dealing by a trustee triggers the no-further-inquiry rule, making the transaction voidable by beneficiaries without regard to fairness or good faith.

(MD Bar) Maryland Bar Exam Practice Test

(MD Bar) Maryland Bar Exam Practice Test

MD Bar Wills Trusts and Estates 3