Beneficiaries of Revocable Trusts do not have Constitutionally Protected Interests

In Livesay v. Carolina First Bank, 665 S.E.2d 158 (N.C. Ct. App. 2008), a North Carolina Appellate court rejected the argument that the application of a statute making property held in a revocable trust which was created before the statute’s effective date subject to the settlor’s debts is an impermissible retroactive alteration of vested rights. The court held that because a revocable trust is a will substitute, the beneficiaries of the trust have expectancies rather than vested rights and therefore they have no constitutionally protected interests.