Legal Question in Wills and Trusts in California
irrevocable trust account
We made irrevocable children's trust for two kids and the trustee, my relative, lives overseas. Later we divorced and divorce agreement said to divide the balance of the trust equally b/w the two kids. Ex only supported one kid then through college and did not pay the child support for the other kid till he was forced last month. So the trustee used most of the fund for her and her college expenses in the trust account. Now ex demands to return money (the kid's share) he spent for first kid and he won't divide our assets as divorce decree because of this reason. My then attorney said the court doesn't have the power over irrevocable trust account. True? Is she(second kid) legally obligated to return money that she spent on her education? What will the probate court say? Attorneys have different opinions.
2 Answers from Attorneys
Re: irrevocable trust account
If you have already spoken to a couple of attorneys on this, I am not sure what you hope to get out of posting this to lawguru.
That being said, in a general sense an irrevocable trust is its own entity. If you or your wife do not have any beneficiary rights to the trust, nor have retained any powers... then it was not part of your marital property when the divorce occurred. Meaning that a divorce settlement agreement should not have affected the pre-existing irrevocable trust.
There is a major exception to this, however. If a court, with appropriate jurisdiction, found that the creation of the trust was a fraudulent conveyance (or for some other reason invalid), they might destroy the trust and reapportion the trust assets. It doesn't sound like this is what happened here, but no one will be able to answer your question appropriately without reviewing the trust document, the divorce decree/settlement agreement, etc.
Re: irrevocable trust account
Certainly an unusual situation. It sounds like the trustee of the trust violated the terms and is liable to the trust beneficiary who lost out for his damages. But, this is no defense to husband's failure to divide assets as per court decree.