Authority to create a trust is limited by fiduciary duty

In In reEstate of Kurrelmeyer, 895 A.2d 207 (Vt. 2006), the decedent’s will gave his wifea life estate in real property, remainder to his children. Using authoritygranted her under a durable power of attorney, the wife created a trust andtransferred the property to it. Under the trust, she had greater rights in theproperty than under the will. The courtheld that the trust and the transfer were valid, finding that the power ofattorney authorized creation of the trust, that creation of the trust was notnon-delegable even though the trust served a function similar to a will, andthat by giving the power to convey real estate to the agent, the principal musthave anticipated that the terms of his will might be altered. The courtremanded, however, for consideration of whether the wife as an agent breachedher duty of loyalty.