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The Four Corners Of The Trust Instrument Get Tighter

September 28, 2016

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When a court is called upon to decide a trust dispute, it starts by looking at the intent of the settlor.  Invariably there is some statement about the court being bound by the “four corners” of the trust.  Only if the language within the trust instrument is ambiguous can the court then look at evidence outside of the trust instrument.  Just how serious are Georgia‘s appellate courts when it comes to sticking to the language in the trust instrument? In Jackson v. Nowland, the Georgia Court of Appeals refused to look at outside evidence that created a pretty clear ambiguity with the trust termination language.

The trust at issue contained a provision that the trust would continue during the settlor’s life and until her youngest named family members had reached the age of 27.  Pretty easy,

Where do our Presidential Candidates Stand on Estate Tax?

Where do our Presidential Candidates Stand on Estate Tax?

September 27, 2016

Authored by: Stacie J. Rottenstreich and Stephanie Moll




Both presidential candidates have proposed changes to the estate tax regime.  Coming as a surprise to nobody, the proposals are quite different.

Projected Inflation-Adjusted Estate, Gift and GST Tax Exclusion Amounts for 2017 Now Available



Based on the Consumer Price Index for the 12-month period ending August 31, 2016, Thompson Reuters Checkpoint has released their projected inflation-adjusted Estate, Gift, GST tax, and other exclusion amounts for 2017, as follows:

Do You Really Want To Use That Power Of Attorney To Give Yourself Something?

September 21, 2016

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In Georgia, an agent acting under a power of attorney can give himself the principal’s property at the principal’s direction.  The Georgia Supreme Court reaffirmed that maxim in Anderson v. Anderson.

There, less than a week before the principal’s death, the agent used a power of attorney to execute a deed conveying to himself 280 acres of the principal’s property and another 500 acres of the principal’s property to himself and his siblings. The trial court set aside the deeds on the grounds of a breach of fiduciary duty.  The Georgia Supreme Court reversed and remanded because there was some evidence that the agent executed the deeds at the principal’s request.  There can be no breach of fiduciary duty when an agent acts pursuant to the principal’s express direction or with

IRS Provides Sample Language for “Qualified Contingency” to Meet “Probability of Exhaustion Test”

One of the many requirements that a trust must meet in order for it to qualify as a Charitable Remainder Annuity Trust (“CRAT”) is the “Probability of Exhaustion Test”.  This test applies to CRATs whose annuity term is based on one or more lifetimes, and requires the likelihood that the charitable remainder beneficiary will not receive its interest in the trust be 5% or less.  If a trust fails the test, then the charitable remainder interest does not qualify for income, gift, or estate tax charitable deductions, and the trust is not exempt from income tax.

Giving Away What You Don’t Know You Have

September 14, 2016

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Under Georgia law, the standard for testamentary capacity requires that a testator remember generally what property is subject to the will’s disposition.  You don’t have to know every dollar, where it is, or all your personal property.  You just have to have some idea of what you have in order to give it away.  While we’d like to quibble over how specific your knowledge must be about the extent of your property to demonstrate testamentary capacity, in Webb v. Reeves, the Georgia Supreme Court just told us that you don’t actually need to know the extent of your property as long as someone apprises you of it.

In this estate dispute’s second appearance here, a caveat was filed to the petition to probate the will of Joseph Thomas Schmidt on, among

Final IRS Regulations Clarify Tax Rules for Same-Sex Couples


Effective September 2, 2016, the Internal Revenue Service formally put into place amendments to regulations that define who is married for tax purposes.   The new regulations finalize proposed regulations issued in 2015, with only a few minor changes.  The IRS Regulation states that it will interpret the term “husband and wife” as any two people who are married to each other, even if they are a same-sex couple.

Trust Instrument Can’t Completely Insulate Trustee From Liability

September 2, 2016

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Settlors often want to give their trustees peace of mind that they can administer the trust without a court looking over their shoulder and second-guessing every act they take.  So, estate planners will often put a broad exculpatory clause in the trust instrument to relieve the trustee from liability for certain actions in administering the trust.  But, just as we have seen in other jurisdictions, in In re Scott David Hurwich 1986 Irrevocable Trust, the Court of Appeals of Indiana recognized that there is a limit as to how far the relief from liability can extend.

A settlor/beneficiary of a trust sued the trustee, alleging mismanagement of trust assets, commingling trust assets with the trustee’s own funds, conversion of trust assets, waste of trust

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