Trust law distinguishes between “qualified beneficiaries” and “beneficiaries.” A “beneficiary” is a person that has a present or future beneficial interest in a trust or holds a power of appointment over trust property. Section 456.1-103(3), RSMo. A “qualified beneficiary” is different. It includes a beneficiary who is currently eligible to receive trust distributions, as well as beneficiaries who would would be eligible to receive trust distributions if the trust terminated on that date. Section 456.1-103(21), RSMo.
Why does this matter? The Trust Code differentiates between what a beneficiary may do and what a qualified beneficiary may do. For example, a qualified beneficiary may move for trustee removal. Further, the Court of Appeals has found that “beneficiaries…have standing to bring a petition to remedy a breach of trust.” Gould v. Gould, 280 S.W.3d 137, 142 (Mo. Ct. App. 2009) (citing UTC Commentary to Section 1001 “[b]eneficiaries and cotrustees have standing to bring a petition to remedy a breach of trust”). A trustee who commits a breach of trust “is liable to the beneficiaries affected.” Section 456.10-1002, RSMo.
In trust litigation, it is important to identify whether someone is a beneficiary or qualified beneficiary. It may impact the dispute. It will also affect a person’s rights and obligations. To make things even more complex, the Trust Code differentiates between what an “interested person” or “person” may do.