[WSBAPT] Amendment of RLT by only one Trustor

[Martin]

Kristina, 

 

I have not seen replies to this post so let me give my response based on my experience more, and less on research.  I let the survivor of a RLT amend the trust after his wife died because there was  funny and rather unspecific language in the trust that I thought could be construed to authorize revocation, amendment, etc, by the survivor.  But this was a beloved relative of mine and all that he wanted was to amend the % shares of kids back to the original equal shares after he and his wife had taken my suggestion to tilt the shares in favor of one child for medical reasons.  Years later this became unnecessary and I went along with the amendment  though to be honest I probably would have let him do it in all events.  But I was antsy about it.  Outside of that I would be very concerned with the language of “impair the right” as language that invites litigation among beneficiaries and former beneficiaries, especially if children by different spouses are involved or there is even a minute possibility among possible beneficiaries.  If it can happen, money will bring it out.  You can tinker with waivers but I think that the language in article VI will be argued as a no brainer by opposing counsel.  What “rights” does the impaired spouse have if it does not include the plan of distribution?  Nuf said.   

 

 

From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Kristina devore
Sent: Thursday, April 18, 2019 5:44 PM
To: WSBA Probate & Trust Listserv
Subject: [WSBAPT] Amendment of RLT by only one Trustor

 

 

I have an estate planning client that would like to amend the ultimate distribution provisions of a revocable living trust that she and her husband created seven years ago.  The proposed changed distributions are for distributions after both Trustors are deceased, it does not affect distributions while either Trustor is living. The Husband now has dementia and is not able to execute any estate planning documents.  This is my first experience with a Trust that authorizes one of the Trustors to make amendments so I have a couple questions.

 

I read RCW 11.103.030 to allow amendment by one of the Trustors ONLY if the trust agreement specifically authorizes… “If a revocable trust is created or funded by more than one trustor and unless the trust agreement provides otherwise: (a) To the extent the trust consists of community property, the trust may be … amended only by joint action of both spouses…;”

 

The current document has the following provisions regarding amendment:

 

        ARTICLE III

“Upon the death or permanent incapacity of either of the Trustors, as the term incapacity is defined in Article VI hereunder, the surviving Trustor or the Trustor having the ability to exercise the capacity to amend or revoke this Trust agreement shall have the authority to amend or revoke the Agreement in whole or in part as the surviving Trustor or the Trustor having capacity if one Trustor is incapacitated deems appropriate.”

 

ARTICLE VI

Incapacitated Trustor is incapacitated as defined in Article VI, however, this Article also provides:

 

“Should either Trustor be incapacitated, then the other Trustor shall act as the agent for the marital community in exercising the rights reserved to the Trustors by Article III; provided, no amendment or direction concerning distributions shall impair the rights of the incapacitated Trustor.”

 

My questions are 1) Is my reading of the statute correct so that an amendment in this case by only one Trustor is authorized?  And 2) Would an amendment changing the ultimate beneficiaries be considered to “impair the rights of the incapacitated Trustor” such that it would not be permissible under the above Article VI limitations?

 

If anyone has any insight on amending in these circumstances I would really appreciate your thoughts.

 

Thanks,

Kristina

 

Kristina S. DeVore | Attorney & Counselor at Law

KRISTINA DEVORE LAW FIRM, pllc | P.O. BOX 87625 | Vancouver, WA  98687

Phone: (360) 695-0535 |  Kristina at devore-law.com

 

 

 

 

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