The settlor created a revocable trust for the benefit of all of his children with the two children of his second marriage as trustees. After the settlor’s death, the non-trustee beneficiaries learned that $1.8 million had been transferred out of the trust in the eighteen months before the settlor’s death. They began a proceeding to require the trustees to give them information on the transfers, such as whether the settlor had initiated them. The trial court granted summary judgment to the trustees because state law provides that while the settlor of a revocable trust is alive “beneficiaries other than the settlor have no right to receive notice, information or reports” from the trustees. In Tseng v. Tseng 352 P.3d 74 (Or. Ct. App. 2015), the intermediate appellate court reversed, holding that the statutory prohibition applies only while the settlor is alive and that after the settlor’s death, the qualified beneficiaries are entitled to information necessary to protect their interests which in this case was information on whether the settlor made, approved, or ratified the transfers.
Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.
