Also known as:appointive assets · appointive property
Written by attorneys · grounded in primary & secondary sources — see below
An asset that is subject to a power of appointment.
Sources & Authorities
How it applies
Common Examples
2
Creditor Claim on Trust Assets
Kayla held a power of appointment over trust property and signed a promissory note directing payment of any appointive assets to National Works, her creditor. The trust required a labeled Appointment Notice that Kayla never executed. After her death the court applied equitable principles to treat the note as an effective exercise because National Works supplied value during a downturn, allowing the creditor to reach the appointive assets ahead of the default taker.
Spousal Reach of Appointive Property
Martin placed hedge fund interests in an irrevocable trust and granted his spouse Lena a testamentary power to appoint the assets among family members or her estate. At Lena's death her probate estate held insufficient assets to pay creditors. The appointive assets became reachable by those creditors to the same extent as if Lena had owned the property outright.
Select any source to read its text and confirm it supports the definition.
Restatements
Dictionaries
Sullivan v. Burkin390 Mass. 864, 867, 460 N.E.2d 572 (1984)
Common questions
Frequently Asked
4
What distinguishes an appointive asset from other trust property?+
An appointive asset is property subject to a power of appointment that enables the donee to designate recipients of beneficial interests. The asset remains separate from the donee's owned property until the power is exercised or creditors reach it under applicable rules.
Supporting sources
Can creditors reach appointive assets when the donee's estate is insolvent?+
Creditors may reach property subject to a general power created by a third party and exercisable by will to the extent the probate estate is insufficient. The assets are treated as reachable in the same manner as owned property.
How does a power of appointment affect distribution of appointive assets at the donee's death?+
If the donee fails to exercise a nongeneral power and no gift-in-default clause exists, the assets pass to permissible appointees when the class is defined and limited and the donor did not intend appointment to be the sole means of receipt. Otherwise the property reverts to the donor's successors.
Does an informal writing effectively appoint an appointive asset?+
Equity may uphold an appointment that approximates the donor's required formalities when the appointee is a creditor or natural object of the donee's affection. A signed note or notebook entry can suffice if it fulfills the essential functions of a written direction despite missing labels or filing steps.
390 Mass. 864, 460 N.E.2d 572 (1984)Wills Trusts and Estates
…interested.” [^maj-3]: The reporter, Professor A. James Casner, recommended the following statement: “§ 13.7 Spousal Rights in Appointive Assets on Death of Donee. The spouse of the donee of a power of appointment is entitled to treat appointive assets as owned assets of the donee on the donee’s death, only to the extent provided by…
Trusts and Estates Trusts and Future InterestsFuture interests · Powers of appointmentUBEFoundational