The current income beneficiary and her adult children, the presumptive remainder beneficiaries (takers in default of her exercise of a power of appointment) of a testamentary trust created more than eighty years ago by the will of the income beneficiary’s father petitioned the Delaware Court of Chancery for an order changing the trust’s administrative provisions to make it a directed trust, that is, one in which the trustee would take direction from an investment advisor, a position which would be held by two of the income beneficiary’s adult children. In effect, the corporate co-trustee would carry out administrative functions. The will had been admitted to probate in New York and in 2001 the co-trustees, the income beneficiary, and a bank obtained the permission of the New York and Delaware courts to move the trust’s situs to Delaware with the income beneficiary and the Delaware affiliate of the original corporate trustee as co-trustees. In In re Trust under Will of Flint, the Court of Chancery denied the petition, finding that drastically changing the role of the corporate trustee was contrary to the testator’s intent and could not be justified solely by the consent of the beneficiaries
Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.
