Introduction

• Author: Jerold I. Horn
• Profession: Lawyer
• Pages: 1-5

1

Uncertainty abounds for an owner of property who is addressing the disposition of

his or her estate. The uncertainty extends to births and deaths, to marriages, to health,

to abilities and personalities, to resources and needs, and, not least, to a system of law

of which the only constant is unpredictable, and possibly revolutionary, change. The

uncertainty extends even to the fundamental issues of the taxes, the exemptions, and

the rates that will or will not exist. What is the owner to do? Flexibility at least offers the

possibility of solutions.

The writer suggests and analyzes provisions and systems that are designed to enhance

exibility, and to dene its limits, in the planning of trusts and estates. The purpose is

to cope with uncertainty. Although subtly in some cases, all of this book relates to ex-

ibility. Some of the forms (for example, Form 3.1 through Form 3.4) preclude exibility

and are included solely for purposes of comparison. Some (for example, Form 3.5, which

disposes of a self-adjusting number of shares, and Form 3.6 and Form 3.7, which create

formula-determined dispositions) show that exibility is important even if no one is to

possess any discretion. Others (for example, Form 20.6, Form 20.15 and Form 20.16) are

drafted in terms of the outer limits of exibility and are intended to enhance the ability

of a power holder to operate within the limits.

I. OBJEC TIV ES

The primary objectives of property owners relate to enjoyment, management, protection

against creditors, control, tax efciency, and investment efciency. The objectives are

not necessarily consistent. Accomplishment of one or more of them might necessitate

the sacrice of one or more others, in whole or in part. Tensions particularly can exist

between control and each of the other objectives. See, for example, the discussions at II.E.

of Subpart 2 of Part One of Chapter 3 and VII, VIII and IX of Subpart 2 of Part Three of

Chapter 3, concerning tension between allowing a beneciary to control dispositions,

on the one hand, and protecting assets from creditors, on the other. The adviser must

know the extent to which attainment of one or more objectives precludes attainment of

1

Introduction