What Can Invalidate a Living Trust?
Many people create wills or trusts to protect their assets and their family, both throughout their life and at the time of their death. A will allows the beneficiaries to receive a person's assets after her death. A living trust, however, allows the person to place assets in a trust while he is still alive. Like a will, a living trust can be contested if a beneficiary feels all or part of the will was invalidated.
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Living Trusts
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A living trust is created while the grantor -- the person setting up this trust -- is still alive. The grantor places all of her assets into the trust, including property and financial assets. A trustee then takes control of these assets. During her lifetime, the grantor can use these assets freely. After her death, the people named as beneficiaries will receive the trust. Unlike assets in a traditional will, assets in a living trust do not enter probate, and the beneficiary receives them immediately. Typically, grantors list spouses and immediate family members as beneficiaries, but the grantor can list anyone she wishes, including friends, extended family and charitable organizations.
Invalidating a Living Trust
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Most people create a revocable living trust, meaning the grantor can revoke the trust from the beneficiaries at any time. The beneficiaries can also contest a living trust, providing they can prove the trust is invalid. To invalidate a living trust, the person contesting it must prove that the grantor created the trust under duress or pressure, and not of his own free will. The person contesting the trust can also claim that the grantor was not mentally competent and able to create the trust when it was formed and signed.
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Contesting a Living Trust
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To contest a living trust, you will have to go through a lawyer who will present your case to a judge. Generally, your case will consist of what reason you have to invalidate the living trust, such as mental incompetency or fraudulent creation. You will need to present proof, for example, that the grantor was not of sound mind the day he created the trust.
Warnings
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Invalidating a living trust can prove difficult, as it can be onerous and expensive to prove someone else's mental state, especially if the living trust has been in existence for several years. Speak to a qualified lawyer who specializes in trust cases before proceeding with a contest.
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