STEP Trust and Estate Law 2

Question 1

Under the Uniform Trust Code, which party has standing to enforce a charitable trust when no specific beneficiary exists?

Accepted Answer

The state attorney general

Answer

The state attorney general has standing to enforce charitable trusts on behalf of the public interest when no private beneficiary can do so.

Question 2

A spendthrift clause in a trust is MOST effective at protecting trust assets from:

Accepted Answer

The beneficiary's future tort creditors

Answer

Spendthrift provisions are most effective against voluntary and involuntary transfers to future creditors, though exceptions exist for alimony, federal liens, and Medicaid.

Question 3

What is the primary distinction between a resulting trust and a constructive trust?

Accepted Answer

Resulting trusts arise from presumed intent; constructive trusts are remedial devices imposed by equity

Answer

A resulting trust reflects the presumed intent of the transferor, while a constructive trust is an equitable remedy imposed to prevent unjust enrichment regardless of intent.

Question 4

Under the rule in Saunders v Vautier, a beneficiary may compel early termination of a trust if:

Accepted Answer

All beneficiaries are adults, have full capacity, and together hold the entire beneficial interest

Answer

Saunders v Vautier allows trust termination when all beneficiaries are sui juris and collectively entitled to the entire beneficial interest.

Question 5

Which doctrine allows a court to modify a charitable trust when the original purpose becomes impossible or impractical?

Accepted Answer

Cy-pres doctrine

Answer

The cy-pres doctrine permits courts to redirect a charitable trust to a purpose as near as possible to the original when the stated purpose fails.

(STEP) Society of Trust and Estate Practitioners Certification Practice Test

(STEP) Society of Trust and Estate Practitioners Certification Practice Test

STEP Trust and Estate Law 2