Section 7.12 Specific Rules

• Library: Trusts and Powers 2013 Supp

D. (§7.12) Specific Rules

Because each trust construction matter is dependent on its peculiar facts and the particular instrument involved, the canons of construction that might be gleaned from the cases is virtually limitless. See Ratermann v. Ratermann, 405 S.W.2d 891 (Mo. 1966). Nonetheless, the topics discussed below are chosen to illustrate what has been characterized as a process of determining what a settlor probably would have intended concerning a matter over which the settlor not only failed to expressly provide but also had no intention. See IIA Austin Wakeman Scott & William Franklin Fratcher, The Law of Trusts § 164.1 (4^th ed. 1987) (Scott on Trusts), and 5 John A. Borron, Jr., Missouri Practice, Probate Law and Practice §§ 311–65 (3^rd ed. 1999 and Supp. 2005), for a much more detailed discussion of the rules of construction that have developed over wills. See also II Mo. Estate Administration ch. 9 (MoBar 4^th ed. 1999 and Cum. Supp. 2005). Concerning whether a trust is intended, it has been held that the transfer of property by an owner to another with the direction to hold it for the benefit of a third person is sufficient to create a trust. Platt v. Huegel, 32 S.W.2d 605 (Mo. 1930). An owner declaring that he or she is holding property for the benefit of another is also sufficient. In re Ott, 630 S.W.2d 182, 184 (Mo. App. W.D. 1982). Magic words of art are clearly not required for a court to impose fiduciary obligations. Section 456.4-401, RSMo Supp. 2005, now specifically provides that a trust may be created by:

(1) transfer of property to another person as trustee during the settlor’s lifetime or by will or other disposition taking effect upon the settlor’s death;

(2) declaration by the owner of property that the owner holds identifiable property as trustee;

(3) exercise of a power of appointment in favor of a trustee; or

(4) a court under section 475.092, 475.093, or 511.030, RSMo.

In the absence of an express or implied power to revoke or amend in a written instrument, the general rule was that the trust was irrevocable. See IVA Scott on Trusts § 330.1 (4^th ed. 1989). Reversing the common law rule, however, § 456.6-602.1, RSMo Supp. 2005, now provides that, except for instruments executed before January 1, 2005, unless the trust instrument expressly provides that the trust is irrevocable, a trust can be amended or revoked by the settlor. Further, when a method of revocation is specified, revocation can only be accomplished in that manner. Maple Tree Invs., Inc. v. Port, 821 S.W.2d 562, 564 (Mo. App. W.D. 1991). The same rule applies concerning the formalities required for an amendment, although a trustee can waive the formality of signing an instrument when the trustee knows of the amendment and acquiesces to it. Estate of Mueller v. Doyen, 933 S.W.2d 903, 907 (Mo. App. E.D. 1996).

See also § 456.6-602.3, which provides that a trust amendment or revocation must substantially comply with the method provided in the trust instrument or, lacking a specified method, by a method manifesting clear and convincing evidence of the settlor’s intent. And note § 456.6-602.5, which permits an agent under a durable power of attorney to revoke or amend a trust, provided that the agent is so authorized in the power of attorney or the trust instrument. But see § 404.710.6(1), RSMo 2000, which requires an agent to have specific authority under the power of attorney instrument to amend or revoke a trust. Note also § 456.6-602.6, which permits a conservator or conservator ad litem, with court approval, to amend or revoke a trust.

But be aware of §§ 456.4A-411, 456.4B-411, and 456.4-412–456.4-416, RSMo Supp. 2005, which provide additional authority for the modification or termination of trusts. Section 456.4A-411 provides a procedure for a settlor and all beneficiaries, without court approval, and the court, provided that...