POWERS - LIABILITY OF APPOINTED PROPERTY FOR DEBTS OF DONEE - VALIDITY OF ATTEMPTED RESTRICTION OF LIABILITY BY THE DONOR

Authors

Ward P. Allen, University of Michigan Law SchoolFollow

Abstract

By the terms of the donor's will a spendthrift trust was set up for her three grandchildren for life, giving them a general testamentary power of appointment over that portion of the corpus from which their share of the income had been derived, "but in no event shall any part of said trust funds be liable for, or be paid or appropriated to or for any debts or liabilities of such grandchildren . . . . " There was a gift over to the issue of the donees in default of appointment. By will one of the donees exercised the power in favor of three named persons who, the court found, were creditors of the donee to the amounts appointed them. Contending that the quoted provision was a limitation on the power, and that it had been exceeded, another donee appealed from the decree of the probate court authorizing the trustees, upon their petition for instructions, to pay over the donee's share to his executors for distribution. Held, although the quoted provision is a restriction on the trustees and not a limitation on the power, the intent to extend the spendthrift provision beyond the lives of the beneficiaries (for which period it is valid) cannot be given effect: the restriction is void; and, since the donee's estate is insolvent, the appointments will be set aside, the property to be shared by all the creditors. State Street Trust Go. v. Kissel, (Mass. 1939) 19 N. E. (2d) 25.

Recommended Citation

Ward P. Allen, POWERS - LIABILITY OF APPOINTED PROPERTY FOR DEBTS OF DONEE - VALIDITY OF ATTEMPTED RESTRICTION OF LIABILITY BY THE DONOR, 37 Mich. L. Rev. 1343 (1939).
Available at: https://repository.law.umich.edu/mlr/vol37/iss8/32