Opinion ID: 1111210
Heading Depth: 1
Heading Rank: 5

Heading: Validity of Trust

Text: Copeland begins by contending that Wyoming has never recognized the validity of revocable trusts and should not do so. An inter vivos trust is a trust created by the grantor during the grantor's lifetime to go into effect during the grantor's lifetime. Soltis v. First of America Bank-Muskegon, 203 Mich.App. 435, 513 N.W.2d 148, 150 (1994) (citing 76 AM.JUR.2D Trusts § 11 at 41). In contrast, a testamentary trust is a trust contained in a will, which goes into effect at the testator's death. Id. The elements of a valid trust are a competent settlor and trustee, the settlor's intent to create a trust, ascertainable trust res, sufficiently ascertainable beneficiary or beneficiaries, a legal purpose and a legal term. Hilbert v. Benson, 917 P.2d 1152, 1157 (Wyo.1996). We have defined a trust as follows: [A] trust is a fiduciary relationship in which one person is the holder of the title to property subject to an equitable obligation to keep or use the property for the benefit of another.... A trust is an obligation imposed, either expressly or by implication of law, whereby the obligor is bound to deal with property over which he has control for the benefit of certain persons, of whom he may himself be one, and any one of whom may enforce the obligation. Scotti's Drive In Restaurants, Inc. v. Mile High-Dart In Corp., 526 P.2d 1193, 1196-97 (Wyo.1974) (citing Bogert, Law of Trusts, § 1 (5th Ed.); quoting 15 Law Q.Rev. 301). Copeland contends that the revocable trust does not qualify as a trust under these definitions because it does not bind the holder or trustee for the benefit of another, no intended beneficiary has the power to enforce the obligation of the trustee, and there is no fiduciary relationship between the beneficiaries and the trustee. Upon Lohrie's death, his revocable trust became irrevocable. This Court has construed and given effect to revocable trusts after the death of the settlor made them irrevocable in First National Bank & Trust Co. of Wyoming v. Brimmer, 504 P.2d 1367 (Wyo.1973), and Hronek v. St. Joseph's Children's Home, 866 P.2d 1305, 1307 (Wyo.1994), and Copeland does not dispute that this trust satisfies the elements of a valid inter vivos trust. Hilbert, 917 P.2d at 1157. Additionally, the district court enforced the express terms of the trust to the benefit of the named beneficiary, Hjelm, contrary to Copeland's argument. Her arguments against revocable trusts listed above are not applicable to this particular case and need not be addressed. Next, Copeland contends that the Session Laws of Wyoming, 1947, Chapter 154, which are now WYO. STAT. §§ 34-2-122 and 123, amended in 1992, required the deed from Alexander and Marguerite Lohrie to their trust to identify the trustee and beneficiaries by name and include the date of the trust's creation. Chapter 154 states: AN ACT for the protection of those dealing with trustees, agents and representatives; prescribing authority of trustees, agents and representatives where trust provisions are not set forth or beneficiaries are not named in the instrument of conveyance to such trustee, agent or representative and providing that any such existing or past conveyance shall not be notice unless related, sworn statement is filed within ten years.    Instruments of ConveyanceRequirements for. Section 1. In all instruments conveying real estate, or interests therein, in which the grantee is described as trustee, agent, or as in any other representative capacity, such instruments of conveyance shall also name the beneficiary or beneficiaries so represented and define the trust or other agreement under which the grantee is acting, or shall refer by proper description of the affecting record book, page, document number or file, to the instrument, order, decree or other writing, which is of public record in the county in which the land so conveyed is located and in which such related matters appear; otherwise the description of a grantee in any representative capacity as aforesaid in each such instrument of conveyance shall be considered and held to be a description of the person, only, and shall not be notice of any trust, agency or other representative capacity of such grantee who shall be held as vested with the power to personally convey, transfer, encumber or release the affected title and whenever he, she or it shall execute and deliver a conveyance, transfer, encumbrance or release of such property in such representative capacity, such shall not thereafter be questioned by anyone claiming as a beneficiary under such trust or agency or by anyone claiming by, through or under any undisclosed beneficiary, provided that none of the trust property in the name of such trustee, agent or representative and owned only as such, shall be liable for his, her or its personal obligations. Grantee, Beneficiary or Beneficiaries. Section 2. At the expiration of ten years after this Act becomes effective, all instruments of conveyance to, or transfer, encumbrance or release of, lands or any interest therein within the State of Wyoming, which name a grantee in such representative capacity, and fail to name the affected beneficiary or beneficiaries or to define the trust or other agreement ... shall cease to be notice of any trust.... 1947 Wyo. Sess. Laws Ch. 154. Hjelm contends that this law was enacted to address attempts during the Depression era where persons attempted to cloud title to real property in order to defeat creditors' claims. Referring to Annotation, 137 A.L.R. 460 (1947), she explains that debtors would convey property to individuals in trust without describing the trust, which usually did not in fact exist. This law was passed to require that trusts be described in deed, but she contends that it does not invalidate a conveyance, but acts to deprive a non-complying deed of the effect of constructive notice to third parties. The warranty deed conveyed property from Alexander Lohrie and Marguerite Lohrie, Husband and Wife, grantors, to the Alexander and Marguerite Lohrie Revocable Trust, grantee. It states that the trust was executed that same day. The deed complies with the plain requirement of the statute because the statute requires the deed name the beneficiaries only when the grantee is a trustee or other individual agent. In this case, there is no requirement to name the beneficiaries. Copeland does not provide any authority that our plain reading of the statute is not correct, and we, therefore, agree with Hjelm that Copeland misreads the statute. The trial court's ruling that the deed properly conveyed the property to the trust is affirmed. Copeland also contends that the trust fails for lack of a successor trustee or provision for appointment of a successor trustee. This argument is without merit since our rule is that a trust will not fail for lack of a trustee. Rodin v. State ex rel. City of Cheyenne, 417 P.2d 180, 199 (Wyo.1966); Kerper v. Kerper, 780 P.2d 923, 939 (Wyo. 1989), appeal after remand, 819 P.2d 407 (Wyo.1991). Copeland offers no argument that this rule does not apply to a successor trustee; we see no reason why it would not, and we find that the district court did not err in enforcing the trust.