September 28, 2016
Authored by: Luke Lantta
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, right? Plain language of the trust indicates that it terminates when the youngest family member reaches 27. One problem: at the time the settlor executed the trust, all of the beneficiaries were already over the age of 27. Thus, it was argued that a different provision in the trust governed the trust’s termination. This additional information about the beneficiaries’ ages at the time of trust execution, however, was outside of the four corners of the trust and should have been disregarded by the trial court. The plain language of the trust, uninfected with outside evidence, stated that the trust terminated when the beneficiaries were 27. Were they all 27 at the time of the settlor’s death? Yes. Then, the trust terminated.