{"id":12314,"date":"2021-10-17T08:41:29","date_gmt":"2021-10-17T13:41:29","guid":{"rendered":"https:\/\/legaltalktexas.hammerle.com\/?p=12314"},"modified":"2025-06-18T16:56:06","modified_gmt":"2025-06-18T21:56:06","slug":"hit-by-a-semi-trusts-imposed-in-secret","status":"publish","type":"post","link":"https:\/\/hammerle.com\/legaltalk\/probate\/hit-by-a-semi-trusts-imposed-in-secret\/","title":{"rendered":"Hit by a Semi &#8211; Trusts Imposed in Secret"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Trusts can pop up in the darndest places.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Take wills, for example. In one case, Sam, a lawyer, <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/estate-planning-and-probate\/how-to-write-a-will-in-texas\/\"><span style=\"font-weight: 400;\">drafted a will<\/span><\/a><span style=\"font-weight: 400;\"> for his long-time friend and client, Nancy, that stated she was leaving all her property to him \u201cto be distributed in accordance with the specific instructions I have provided him.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The will did not contain the specific instructions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Nancy died, leaving no husband and no children. Her will was <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/estate-planning-and-probate\/probate-and-its-process-explained\/\"><span style=\"font-weight: 400;\">probated<\/span><\/a><span style=\"font-weight: 400;\"> and then her executor asked the court how the property should be distributed.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Cue the issue of <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/elder-law\/trusts-in-texas\/\"><span style=\"font-weight: 400;\">trusts<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Essentials of a Trust<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The court decided that Sam\u2019s position to hold property for the benefit of others was a \u201ctrust\u201d position.\u00a0 Because the trust was described in Nancy\u2019s will, it was considered a \u201ctestamentary trust\u201d and had to contain certain essential terms to be valid. One of those essential terms was the identity of the ultimate <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/family-law\/marriage\/4-common-mistakes-beneficiary-designations\/\"><span style=\"font-weight: 400;\">beneficiaries<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But the will did not name the ultimate beneficiaries.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">While her will was clear that Nancy had intended to give the property to her lawyer Sam to hold and distribute to other people, it was conspicuously silent on the identity of those people. There was a hearing where testimony was introduced that Nancy had verbally told Sam that he was to distribute one of her houses to himself and make several other distributions to specific people.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Unfortunately, the court found that Nancy\u2019s verbal instructions to Sam were of no help. There is a rule for written trusts that outside evidence cannot be introduced to supply a missing essential term.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Thus, Nancy\u2019s testamentary trust failed for lack of an essential term. History is replete with examples of failed express testamentary trusts. Dispositions that leave the ultimate property distribution to the \u201chonesty and integrity\u201d of the executor or to someone to \u201cbe disposed of by him as I have heretofore or may hereafter direct him to do,\u201d are going to fail every time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When the disposition failed the testamentary trust test, it morphed into a \u201csemi-secret trust\u201d.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Semi-Secret, Secret &amp; Resulting Trusts<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">When a will contains a semi-secret trust, the ultimate beneficiaries are the testator\u2019s heirs at law. That meant Nancy\u2019s heirs inherited all her property.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Now we come to another type of trust: a resulting trust. This is a remedy that recognized that, while Sam has a right to receive the estate property, he held only legal title to it. He did not have the right to keep and use it. He was holding the property in a resulting trust for the benefit of Nancy\u2019s heirs and was obligated to give them the property.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It was almost as if Nancy had died without a will.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">While we are on this topic, let\u2019s talk about another strange phenomenon: the secret trust. This is an actual thing, supported by such unassailable authority as an 1892 Texas Supreme Court opinion. A secret trust occurs when the parties agree that the property is to be held in trust for a specific use, but do not put it in writing. Suppose Ben tells Jill that if she leaves him all her money, he will use it to support various dog charities. She relies on his promise and in her will leaves all her property to Ben. Her will says nothing about a trust. This is a secret trust, and the law imposes a duty on Ben to apply the inherited money to support charities for dogs.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The lesson? Spell out all of the essential terms of a trust in writing.<\/span><\/p>\n<p><a href=\"https:\/\/hammerle.com\/lawyers\/virginia-hammerle\/\"><i><span style=\"font-weight: 400;\">Virginia Hammerle<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> is president of\u00a0 <\/span><\/i><a href=\"https:\/\/hammerle.com\/\"><i><span style=\"font-weight: 400;\">Hammerle Morris Law Firm<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">. She is an Accredited <\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/estate-planning\/\"><i><span style=\"font-weight: 400;\">Estate Planner<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">, has been Board Certified in <\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/litigation-lawyers\/\"><i><span style=\"font-weight: 400;\">Civil Trial Law<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> for 25 years, and recognized as a Super Lawyer for the past 10 years. She blogs regularly on<\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/elder-law\/\"><i><span style=\"font-weight: 400;\"> senior issues<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> and the law and has a monthly newsletter. Contact at legaltalktexas@hammerle.com.<\/span><\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Trusts can pop up in the darndest places. Take wills, for example. In one case, Sam, a lawyer, drafted a will for his long-time friend and client, Nancy, that stated she was leaving all her property to him \u201cto be distributed in accordance with the specific instructions I have provided him.\u201d The will did not [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":12315,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[1225],"tags":[747,685,905,1204],"class_list":{"0":"post-12314","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-probate","8":"tag-beneficiaries","9":"tag-estate-planning","10":"tag-trusts","11":"tag-will"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Hit by a Semi - Trusts Imposed in Secret - Hammerle Morris Law Firm<\/title>\n<meta name=\"description\" content=\"Did you know that trusts can pop up in the least expected of places, including in wills? If wills don\u2019t name a trust\u2019s beneficiaries, a semi-secret trust can arise.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/hammerle.com\/legaltalk\/probate\/hit-by-a-semi-trusts-imposed-in-secret\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Hit by a Semi - Trusts Imposed in Secret - Hammerle Morris Law Firm\" \/>\n<meta property=\"og:description\" content=\"Did you know that trusts can pop up in the least expected of places, including in wills? If wills don\u2019t name a trust\u2019s beneficiaries, a semi-secret trust can arise.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/hammerle.com\/legaltalk\/probate\/hit-by-a-semi-trusts-imposed-in-secret\/\" \/>\n<meta property=\"og:site_name\" content=\"Hammerle Morris Law Firm\" \/>\n<meta property=\"article:published_time\" content=\"2021-10-17T13:41:29+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-06-18T21:56:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/hammerle.com\/legaltalk\/wp-content\/uploads\/sites\/2\/2021\/10\/10.17-blog.png\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"500\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Virginia Hammerle\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Virginia Hammerle\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/\"},\"author\":{\"name\":\"Virginia Hammerle\",\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/#\\\/schema\\\/person\\\/3a35dce360aad1cd9da53574c3c1a6bd\"},\"headline\":\"Hit by a Semi &#8211; Trusts Imposed in Secret\",\"datePublished\":\"2021-10-17T13:41:29+00:00\",\"dateModified\":\"2025-06-18T21:56:06+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/\"},\"wordCount\":651,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/wp-content\\\/uploads\\\/sites\\\/2\\\/2021\\\/10\\\/10.17-blog.png\",\"keywords\":[\"Beneficiaries\",\"Estate Planning\",\"Trusts\",\"will\"],\"articleSection\":[\"Probate\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/\",\"url\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/\",\"name\":\"Hit by a Semi - Trusts Imposed in Secret - Hammerle Morris Law Firm\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/probate\\\/hit-by-a-semi-trusts-imposed-in-secret\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/wp-content\\\/uploads\\\/sites\\\/2\\\/2021\\\/10\\\/10.17-blog.png\",\"datePublished\":\"2021-10-17T13:41:29+00:00\",\"dateModified\":\"2025-06-18T21:56:06+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/hammerle.com\\\/legaltalk\\\/#\\\/schema\\\/person\\\/3a35dce360aad1cd9da53574c3c1a6bd\"},\"description\":\"Did you know that trusts can pop up in the least expected of places, including in wills? 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