Glossary

The words a trust document uses, defined from the statute

Each term stands on its own: what it means, which section of Minnesota law uses it, and which guide explains the machinery behind it.

A

Antilapse: In a Minnesota will, the antilapse rule substitutes for a devisee who is dead, or treated as having predeceased the testator, that devisee's issue who survive the testator by 120 hours. It reaches a devisee who is a grandparent or lineal descendant of a grandparent of the testator, and words of survivorship in the devise switch it off.

B

Beneficiary: Under Minnesota's trust code, a beneficiary is a person with a present or future beneficial interest in a trust, vested or contingent, or a person who holds a power of appointment over trust property in a capacity other than that of trustee.

C

Certificate of trust: A certificate of trust is a sworn document, signed by the settlor or a trustee, stating fewer than all of a trust instrument's provisions: the trust's name if it has one, its date, the trustees and their powers, how many trustees must act, and whether the trust has terminated or the instrument has been revoked.
Collection by affidavit: In Minnesota, collection by affidavit lets a decedent's successor collect personal property on a certified death record and a sworn affidavit, thirty days after death or, for safe deposit box contents, after the box inventory is filed. The entire probate estate less liens and encumbrances must not exceed $75,000, and real estate is outside it.

D

Decantingalso Trust decanting: Decanting is an authorized trustee's exercise of a power to invade trust principal by appointing it to the trustee of another trust. Minnesota's statute calls the original the invaded trust and the recipient the appointed trust, and treats the exercise as a special power of appointment.
Directed trust: In Minnesota, a directed trust is one whose governing instrument appoints or provides for a directing party — an investment or distribution trust advisor, or a trust protector. Where the instrument directs a fiduciary to act on that party's exercise of specified powers, those powers are deemed granted to the party instead, and the fiduciary is an excluded fiduciary.

F

Formal testacy proceedingalso Formal probate proceeding: In Minnesota, a formal testacy proceeding is one conducted with notice to interested persons before a court to establish a will or determine intestacy. An interested person or a personal representative named in the will commences it by petition, and it may but need not include a request to appoint a personal representative.
Fundingalso Funding a trust: Funding is the act of transferring property into a trust so that the trustee holds it. Minnesota's trust code says a trust may be created by transfer of property to another person as trustee, by a declaration that the owner holds identifiable property as trustee, or by exercise of a power of appointment in favor of a trustee.

H

Homestead: In Minnesota, the homestead is the house a debtor owns and occupies as the debtor's dwelling place, with the land under it up to the statutory area and value. It is exempt, for the debtor and the debtor's family, from seizure or sale under legal process on any debt not lawfully charged on it in writing, with stated exceptions.

I

Informal probate: In Minnesota, informal probate is an informal proceeding for the probate of a decedent's will, with or without an application for informal appointment of a personal representative. The application is directed to the registrar and verified by the applicant, and the registrar acts on documentary findings rather than after a hearing.
Intestate succession: In Minnesota, intestate succession is the statutory order in which a decedent's estate passes to heirs. The intestate estate is any part not allowed to the spouse or descendants under the homestead, exempt property and family allowance sections and not disposed of by will, and it passes as the probate code prescribes except as modified by the decedent's will.
Irrevocable trust: An irrevocable trust is one the settlor cannot revoke or amend. Minnesota's definitions section defines 'revocable' and does not define 'irrevocable.' A noncharitable irrevocable trust can still be modified or terminated by consent of the settlor and all beneficiaries, or by a court.

N

Nonjudicial settlement agreement: In Minnesota, a nonjudicial settlement agreement is a binding agreement among interested persons — those whose consent a court-approved settlement would require — with respect to any matter involving a trust. It is valid only so far as it does not violate a material purpose of the trust and carries terms a court could properly approve.

P

Per stirpesalso Representation: In Minnesota, a governing instrument that leaves property per stirpes divides it, absent a finding of contrary intention, into as many equal shares as there are surviving children of the designated ancestor plus deceased children who left surviving descendants. Each surviving child takes one share; a deceased child's share subdivides the same way at each succeeding generation.
Personal representative: In Minnesota probate, a personal representative is the person appointed to settle and distribute a decedent's estate. The probate code's term includes an executor, an administrator, a successor personal representative, a special administrator, and persons who perform substantially the same function under the law governing their status.
Pooled trust: For Minnesota medical assistance, a pooled trust holds a disabled individual's own assets, is established and managed by a nonprofit association, and keeps a separate account for each beneficiary while pooling the accounts for investment. A beneficiary's interest counts as an available asset unless the trust meets Minnesota's conditions on what the nonprofit may keep.
Pour-over willalso Testamentary addition to a trust: A pour-over will devises property to the trustee of a trust identified in the will, whose terms are set out in a written instrument other than a will, or in the will of another individual who predeceased the testator. In Minnesota the devised property becomes part of that trust rather than a testamentary trust, unless the will provides otherwise.
Probate: Probate is the court process for establishing a decedent's will or determining intestacy and appointing a personal representative. Minnesota's probate code provides informal proceedings, conducted by the judge, the registrar, or a person the judge designates, and formal testacy proceedings, conducted with notice to interested persons before a court.
Prudent investor rulealso Minnesota Prudent Investor Act: In Minnesota, the prudent investor rule requires a trustee who invests and manages trust assets to do so as a prudent investor would, considering the purposes, terms, distribution requirements and other circumstances of the trust, and exercising reasonable care, skill and caution. It is a default rule the trust instrument may expand, restrict, eliminate or otherwise alter.

Q

Qualified beneficiary: Under Minnesota's trust code, a qualified beneficiary is a beneficiary who, on the date qualification is determined, is a distributee or permissible distributee of trust income or principal, or would become one if the interests of the present distributees and permissible distributees terminated without causing the trust to terminate, or if the trust terminated.

R

Registraralso Probate registrar: In Minnesota, the registrar is the judge of the court, or the person the court designates by written order, who performs the acts and orders the probate code assigns to the registrar. The registrar acts on informal probate and appointment applications, and may not render advice calling for the exercise of professional judgment that constitutes the practice of law.
Revocable trustalso Revocable living trust: A revocable trust is one the settlor can revoke without the consent of the trustee or a person holding an adverse interest. In Minnesota, unless the terms of a trust expressly provide that the trust is revocable, the settlor may not revoke or amend it.

S

Settloralso Grantor, Trustor: In Minnesota trust law, a settlor is a person, including a testator, who creates a trust or contributes property to one. Where more than one person creates or contributes property to a trust, each is the settlor of the portion attributable to that person's contribution, except to the extent another person can revoke or withdraw it.
Spendthrift provisionalso Spendthrift trust: In Minnesota, a spendthrift provision is a term of a trust restricting both voluntary and involuntary transfer of a beneficiary's interest. It stops the beneficiary from transferring that interest and stops the beneficiary's creditor from reaching it, subject to statutory exceptions for an overdue mandatory distribution and for claims of the settlor's own creditors.
Successor trustee: A successor trustee is the person who fills a vacancy in the trusteeship. In Minnesota a vacancy need not be filled while a cotrustee remains in office, and must be filled when no trustee remains — for a noncharitable trust, first by whoever the trust designates, then by unanimous agreement of the qualified beneficiaries.
Summary proceedings: In Minnesota, summary proceedings let a court assign a decedent's property, with or without notice and with or without appointing a personal representative. They reach an estate whose property is all exempt from debts and charges in the probate court, and, on further conditions, a gross probate estate not exceeding $150,000 exclusive of the exempt homestead and exempt property.
Supplemental needs trust: In Minnesota, a third-party supplemental needs trust is one created for the benefit of a person with a disability — a term the statute defines — and funded by someone other than the beneficiary, the beneficiary's spouse, or anyone obligated to pay any sum to or for the beneficiary under a settlement agreement or judgment.

T

Transfer on death deedalso TODD: A transfer on death deed conveys an interest in Minnesota real property to a named grantee beneficiary, effective only on the death of the grantor owner. It is valid if recorded before that death in a county where part of the property lies, and until it becomes effective it has no effect on title.
Trustee: A trustee holds and administers trust property for the beneficiaries under the terms of the trust. Minnesota's definitions section says the word includes an original, additional, and successor trustee, and a cotrustee, whether or not appointed or confirmed by a court.

U

U/D/Talso Under declaration of trust: U/D/T abbreviates 'under declaration of trust,' the form used when the person who created the trust is also its trustee. It is a drafting and registration convention rather than a statutory term, and it is followed by the date of the trust instrument.