Legal Question in Wills and Trusts in Maryland
Trust liquified by bank and turned over to co-trustee
My grandmother set up a trust for me with a relative as a co-trustee with a bank. This was over 20yrs ago. The bank pulled out in 2000 and released the funds to the co-trustee. He is older and does not want the responsibility. He would like to just release the funds to me, but doesn't know if he can legally. We need to know what needs to be done to release these funds. The trust was set up to be a trust forever with no age stated for release. Since the bank pulled out there is no true ''trust fund'' and the money is liquid and not invested.
Thank you for any help you can give.
2 Answers from Attorneys
Re: Trust liquified by bank and turned over to co-trustee
The first step you and the Trustee will need to do is review the Trust Instrument to see if there are applicable provisions that give the Trustee the discretion to terminate the trust or exhaust the trust principal. In some cases, trust instruments authorize a trustee to terminate a trust in the event trust administration becomes uneconomical or impractical. If that type of language is in your trust instrument, then you will need to determine whether your particular circumstances are applicable. If no such language is provided, then a Court Order may be required. Issues relating to contingent beneficiaries and the investment requirements of the trustee should also be investigated.
Re: Trust liquified by bank and turned over to co-trustee
Usually the reason the banks drop trusts is the bank is not making any money. Strangely, if the bank is making money on a trust they will simply allow it to remain in the trust department for decades. (Although we are in a somewhat new banking world these days.) I used to go throught the court filing to get approval to invade the trust corpus, etc. However, another trust lawyer in Atlanta, Zoe Hicks, showed us how to simply move to have the trust set aside for "impracticable purpose," and invade 100% of the corpus. It has turned out to be much cheaper if the trust corpus is not too large. Zoe may be reached by Telephone at Hicks & Hicks, Atlanta, Georgia. 770-493-7775. Hugh Wood
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