Revoking a trust is not something that happens all the time, but it is not unheard of either.  Before revoking a trust, it is important to read over the trust carefully and determine how the trust should be revoked.

Unless there is case law or legislative authority on point, Minnesota law tends to follow the Restatement of Trusts (second).  See Conn. Gen. Life Ins. Co. v. First Nat’l Bank of Minneapolis, 262 N.W.2d 403, 405 (Minn.1977) (citing Restatement, Trusts (2d) § 330; In re Syverson Trust, 2003 WL 22016795, *3 (Minn. App. 2003), review denied (Minn. Nov. 18, 2003).  Under Minnesota law, if a trust specifies a manner in which the trust is to be revoked, the trust may only be revoked in that manner.  Id.

For example, if a revocable trust provides that the trust must be revoked using a written instrument that is delivered to the trustee, the trust cannot be revoked by executing a will.  See Conn. Gen. Life Ins. Co., 262 N.W.2d at 405.  This is true even if the will specifically mentions the trust.

Hence it is important to read over the trust and determine exactly how it should be revoked.  If the trust is not revoked in accordance with its terms, a court could find that the revocation is invalid and restore the trust.

Where the power to revoke the trust has been reserved but no method of revocation of trust is specified, the person who created the trust can revoke it using whatever method he or she likes, as long as it “sufficiently manifests the intention of the settlor to revoke the trust.”  Restatement, Trusts (2d) § 330, comment i.

Finally, it is important to review the document to make sure the trust maker has the power to unilaterally revoke the trust.  Under Minnesota law, “[a] settlor may not unilaterally revoke a trust unless the settlor expressly reserved such power when the trust was created.”  Thomas B. Olson & Associates, P.A. v. Leffert, Jay & Polglaze, P.A., 756 N.W.2d 907, 917 (Minn. App. 2008), review denied (Minn. Jan. 20, 2009).  However, the trust can be revoked by the consent of all the beneficiaries and the settlor, even if the power to revoke was not reserved.  Matter of Schroll, 297 N.W.2d 282, 285 (1980).  If one or more of the beneficiaries are unborn, incapacitated, or otherwise unascertainable, the trust may not be revoked or modified without their consent.  Id. at 285-86.

Hence it is tremendously important that someone carefully review his or her trust before revoking it.  The trust must be revoked in a manner that conforms strictly to the method described in the Trust.  If the power of revocation is not reserved, revocation may be impossible or extremely difficult.


Leave a Reply

Your email address will not be published. Required fields are marked *