[WSBAPT] Testamentary Trust Issue

Mon Jul 22 22:51:39 PDT 2024

Hello fellow Listservers,

I have a circumstance involving a testamentary trust and I could use any
guidance or suggestions that you all may collectively have.

The decedent left a will which bequeaths the entire estate via the residuary
clause.  The residuary clause gives equal shares to the decedent's 5
surviving children and a right of representation to the children of a
pre-deceased child.  The residuary clause contains a single sentence
stating" If any beneficiary is under the age 21 then the distribution to
said beneficiary under the age of 21 shall be held in trust."  The will
later sets forth two potential trustees for the trust, without any guidance
how to administer the trust, the process or provision of substitution of
trustees, if any distributions may be made prior to the age of 21, and how
the funds should be held or invested or managed. 

It has come to light that the children of the pre-deceased child are under
the age of 21.  

Questions:

1.	Given that the residuary clause directs any minor's share to be held
in trust (presumably for that minor's benefit) is the appointment of a
Probate Guardian Ad Litem necessary?  I would think not because any minor
would not be a beneficiary and their share would be held in the directed
testamentary trust, but I wanted to confirm and get others' opinions.

2.	If the trustee for the testamentary trust for minor beneficiaries
and the PR are the same person, does this necessarily create a conflict of
interest for that person?  Again, I think not because a PR can also be an
estate beneficiary and even a trustee of a beneficial trust without
necessarily creating a conflict of interest.

3.	Is a petition for instruction from the court on direction to create
the residuary trust necessary or even advisable?  Or instead, it is simply
up to the trustee of the residuary trust to draft the trust agreement so
long as it complies with statutory law and the broad terms of the will?

4.	What is a reasonable mechanism to hold the residuary trust assets
for the minors if the amount of the funds that the trust will receive is
less than $50,000. Would a UTMA account be appropriate?  Trying to help
suggest to the trustee to find a balance between administrative costs and
burdens and creating an account that would create and produce a return for
the beneficiaries of the trust.   

Thanks in advance

Kind regards, 

Michael S. Safren, Esq. 
Attorney at Law 

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