The Cy Pres Doctrine Lawyers
What is the Cy Pres Doctrine?
Cy Pres (pronounced "see-pray") is a legal doctrine that is used by the courts to alter the terms of a charitable trust. When someone leaves a trust to some cause after they die, sometimes the purpose of the trust becomes, due to some event, impossible to fulfill. The courts will then alter the terms of the trust to allow it to continue, while keeping it as closely in accordance to the original intention of the testator as possible.
How Does Cy Pres Work?
In the U.S., Cy Pres only applies to charitable trusts where the original purpose of the trust has become illegal, impossible, or unfeasible, and the trust itself does not specify what is to be done in such a situation. The court then will then attempt to alter the terms in an effort to further the purpose of the trust. If this cannot be done, it will effectively cancel the trust.
- Example: A wealthy investment banker dies, and in his will creates a trust to provide $1,000,000 per year to a bird sanctuary located down the street. The payments are made for several years, until a lightning strike hits the sanctuary and burns it to the ground. The owners decide to relocate to a new location several miles away.
Because the trust was very specific in the location of the sanctuary to be paid, without any modification, the relocated bird sanctuary would not have access to the funds. The courts, however, could look at all the evidence (to deduce the intent of the deceased), and decide that the location was irrelevant to his decision to grant the money; he simply wanted to help the birds. The court then would use the Cy Pres doctrine to alter the terms of the trust so that its true purpose (the protection of birds) could continue.
This is obviously a rather straight forward example, and going to court might not even be necessary if the executors of the trust thought that there was no question as to the deceased intent. But the use of the Cy Pres doctrine is not always so clear cut.
- Example: In the same situation as above, say that instead of helping the birds, the only reason the deceased left money to the sanctuary was because his nephew was the manager. The deceased himself had no love of birds, indeed perhaps he was an avid bird hunter. When the lightning burned down the sanctuary, it also killed the nephew.
Now if the court was called in, it would have to look into the evidence at hand, and may very well conclude that the only purpose of the trust was to care for the nephew, now dead. After assessing all the evidence, it might decide that the money is better spent on the nephews family, or not spent at all, instead of on the new bird sanctuary.
Sometimes, the charitable intent of the donor has become impossible due to changes in the law. In Evans v. Abney, perhaps the most famous case regarding the Cy Pres doctrine, a trust created by a late senator created a public park that was segregated by race. Once such segregation became illegal, the court was forced to determine whether it could employ the Cy Pres doctrine to strike the illegal elements from the trust, and thus keep the park open for everyone.
They held that they could not, because the segregationist portions of the trust was an intrinsic part of the deceased intent. The park was therefore shut down to everyone. This shows how seriously the courts will look toward the intent of the testator.
What About Non-Charitable Trusts?
Although not usually referred to as the Cy Pres Doctrine when it applies to Non-trusts, U.S. law does allow courts to modify the terms of any trust, if as in the above situation, there is an unforeseen problem, and modifying the terms will further the purposes of the trust.
Do I Need an Estate Planning Lawyer?
Consultation with an attorney experienced in estate planning is essential to crafting an plan that is sensitive to both your needs and those of your loved ones. A lawyer will know how to draft the right trust for you, and be there to help fulfill your trust's purposes if needed under the cy pres doctrine.
Consult a Lawyer - Present Your Case Now!
Last Modified: 11-29-2011 04:40 PM PST
