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Declaratory Judgment to Challenge Revocable Living Trusts

The use of revocable living trusts in estate planning is extremely common. Along with the rise of their use, challenges to the validity of revocable living trusts have also risen. Trusts may be contested on a number of grounds, the most common of which are lack of capacity, undue influence, fraud or duress. These claims are very facts sensitive and depend greatly upon the facts of a particular case.

A gray area in the law is when a revocable living trust can be challenged. The general time period is that it is two (2) years after the date of death of the settlor/trust-maker. Section 456.6-604.1(1), RSMo.

However, in certain circumstances, it may be permissible to challenge and request to set aside and void a trust while the trust-maker is still alive via a declaratory judgment. The principles of equity supplement the Missouri Uniform Trust Code. Section 456.1-106, RSMo. Requests for declaratory relief are governed by equitable principles. Inman v. Missouri Dept. of Corrections, 139 S.W.3d 180, 185 (Mo. Ct. App. 2004). The comment to the time limitation provisions of the Uniform Trust Code explicitly states “[n]or does this section preclude an action to determine the validity of a trust that is brought during the settlor’s lifetime, such as a petition for a declaratory judgment, if such action is authorized by other law.” Declaratory relief requires a (1) justiciable controversy; (2) a legally protectable interest at stake; (3) a controversy ripe for judicial determination; and (4) an inadequate remedy at law. Missouri Soybean v. Missouri Clean Water, 102 S.W.3d 10, 25 (Mo. 2003).

As an example, assuming the Court is satisfied that the timing and use of the decalratory relief is appropriate, it may be permissible to use a decaratory judgment to attack a trust when a settlor/trust-maker is alive but legally incapacitated. In such a circumstance, a successor trustee is serving and the underlying trust is irrevocable and usually not subject to any further modification or amendment.

Contact regarding trusts, estate, trust contests, trust litigation and/or declaratory judgments.