REVOCABLE LIVING TRUST AGREEMENT
(Delaware – Draft Template)
[// GUIDANCE: This template is drafted to comply with Delaware trust law under 12 Del. C. § 3303 and related provisions. All bracketed items must be customized before execution. Review Title 12 of the Delaware Code and current Delaware Court of Chancery rules before finalizing.]
TABLE OF CONTENTS
- Document Header
- Definitions
- Operative Provisions
- Representations & Warranties
- Covenants & Restrictions
- Default & Remedies
- Risk Allocation
- Dispute Resolution
- General Provisions
- Execution Block
- Schedule A – Funding Schedule
1. DOCUMENT HEADER
REVOCABLE LIVING TRUST AGREEMENT
Effective Date: [MM/DD/YYYY]
Settlor/Grantor: [SETTLOR LEGAL NAME], an individual residing at [SETTLOR ADDRESS].
Initial Trustee: [TRUSTEE NAME], whose principal address is [TRUSTEE ADDRESS].
Trust Name: “The [SETTLOR SURNAME] Revocable Living Trust” (the “Trust”).
Recitals
A. Settlor desires to establish a revocable management trust to hold and administer certain property during Settlor’s lifetime and to provide for distribution thereafter.
B. Trustee is willing to accept the duties of trustee and administer the Trust in accordance with Settlor’s instructions and Delaware law.
C. This Agreement is intended to be governed by and construed under the laws of the State of Delaware, including 12 Del. C. § 3303, and to qualify as a “revocable trust” for all purposes.
2. DEFINITIONS
Unless the context requires otherwise, the following capitalized terms have the meanings set forth below:
“Accounting Period” – A calendar year ending December 31 or such shorter period as may be required for partial years.
“Affiliate” – With respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with such Person.
“Beneficiary” – Each Person entitled to receive distributions of income or principal, whether present, future, contingent, or otherwise, as identified in Section 3.4.
“Code” – The Internal Revenue Code of 1986, as amended.
“Disability” – Settlor’s inability to manage his or her property or financial affairs, as certified in writing by two licensed physicians or determined by a court of competent jurisdiction.
“Distribution Standard” – The standard set forth in Section 3.3 for discretionary distributions.
“Person” – An individual, corporation, partnership, limited liability company, trust, estate, unincorporated organization, or government agency.
“Trust Estate” – All property transferred to the Trust, together with all additions, substitutions, accumulations, and proceeds.
“Trustee” – The Initial Trustee and any Successor Trustee acting hereunder.
[// GUIDANCE: Add or delete definitions to align with the final drafting.]
3. OPERATIVE PROVISIONS
3.1 Creation and Funding
(a) Settlor hereby transfers to Trustee the property described in Schedule A and any additional property that Settlor or any other Person may later transfer.
(b) Title to all Trust Estate shall be taken and held in the Trustee’s name as “[TRUSTEE NAME], Trustee of The [SETTLOR SURNAME] Revocable Living Trust dated [Effective Date].”
3.2 Revocation and Amendment
(a) Settlor reserves the unrestricted right, exercisable during Settlor’s lifetime and capacity, to revoke, amend, or restate this Agreement, in whole or in part, by delivering a signed, notarized writing to Trustee.
(b) Upon Settlor’s death this Trust shall become irrevocable.
3.3 Distributions During Settlor’s Lifetime
(a) Net Income. During Settlor’s lifetime, Trustee shall distribute to Settlor all net income of the Trust Estate at least annually.
(b) Principal. Trustee may distribute principal to Settlor at any time, in Trustee’s discretion or upon Settlor’s written request.
3.4 Distributions Upon Settlor’s Death
[// GUIDANCE: Insert dispositive provisions for Beneficiaries, e.g., outright gifts, continuing trusts for descendants, charitable bequests.]
3.5 Management During Settlor’s Disability
If Settlor is under a Disability:
(i) Trustee shall apply so much of the Trust Estate as Trustee deems necessary for Settlor’s health, education, support, and maintenance;
(ii) Settlor’s power to revoke or amend shall be exercisable by Settlor’s court-appointed guardian or agent under a valid durable power of attorney, if expressly authorized therein.
3.6 Spendthrift Protection
No Beneficiary shall have the power to anticipate, encumber, or transfer an interest in the Trust Estate, and such interests shall be exempt from the claims of creditors to the maximum extent permitted by Delaware law.
3.7 Trustee Powers
In addition to powers granted by law, Trustee may exercise all powers listed in 12 Del. C. § 3325, including, without limitation, the power to invest, sell, lease, mortgage, and otherwise manage Trust assets.
3.8 Successor Trustee Rules
(a) Resignation. Trustee may resign upon 30 days’ written notice to Settlor (or, after Settlor’s death, to the Beneficiaries).
(b) Incapacity or Removal. If Trustee is unable or unwilling to serve, [NAMED SUCCESSOR] shall become Successor Trustee. Settlor (or after Settlor’s death, a majority of adult Beneficiaries) may remove a Trustee with or without cause.
(c) Acceptance. A Successor Trustee shall accept the trusteeship in writing and shall receive from the prior Trustee a complete accounting and transfer of the Trust Estate.
(d) Title Transfer. Upon any change of Trustee, title to Trust assets shall vest automatically in the Successor Trustee without the need for further act, subject to execution of instruments of conveyance as reasonably requested.
3.9 Asset Transfer Procedures
(a) Real Property. Deeds transferring real property to the Trust shall be recorded in the appropriate county office, referencing this Trust by name and date.
(b) Tangible Personal Property. Settlor may transfer tangible items by signed Assignment of Tangible Personal Property incorporated by reference into Schedule A.
(c) Financial Assets. Brokerage accounts, bank accounts, and certificated securities shall be re-registered in Trustee’s name as required under Section 3.1(b).
(d) Digital Assets. Trustee is authorized to access, manage, and transfer Settlor’s digital assets consistent with 6 Del. C. §§ 500–507 (Delaware Revised Uniform Fiduciary Access to Digital Assets Act).
4. REPRESENTATIONS & WARRANTIES
4.1 Settlor
(a) Capacity. Settlor represents that Settlor is of legal age and sound mind and has full legal capacity to execute this Agreement.
(b) Title. Any property transferred to the Trust is, to Settlor’s knowledge, free of liens and encumbrances except as disclosed in Schedule A.
4.2 Trustee
(a) Authority. Trustee represents that Trustee is legally competent and willing to act.
(b) No Conflict. Trustee warrants that acceptance of the trusteeship will not violate any agreement or legal obligation of Trustee.
Survival. All representations and warranties shall survive the execution and delivery of this Agreement.
5. COVENANTS & RESTRICTIONS
5.1 Trustee Covenants
(a) Standard of Care. Trustee shall administer the Trust in good faith and with the care, skill, and diligence of a prudent person familiar with such matters, consistent with 12 Del. C. § 3302.
(b) Accounting. Trustee shall provide an annual written accounting to Settlor (or, after Settlor’s death, to each current Beneficiary).
(c) Confidentiality. Trustee shall keep Trust matters confidential except as required by law or necessary for administration.
5.2 Settlor Covenants
Settlor shall timely execute all documents reasonably requested by Trustee to transfer assets to the Trust.
6. DEFAULT & REMEDIES
6.1 Events of Default
(a) Trustee’s failure to provide required accountings within 60 days after written notice.
(b) Misappropriation or willful misconduct by Trustee.
(c) Failure of Successor Trustee to accept the trusteeship within 30 days of vacancy.
6.2 Notice & Cure
Non-defaulting Parties shall give written notice specifying the default. The defaulting Party shall have 30 days (10 days for monetary breaches) to cure.
6.3 Remedies
(a) Removal of Trustee by the Court of Chancery or as otherwise provided herein.
(b) Appointment of a court-supervised trustee ad litem.
(c) Specific performance and injunctive relief to enforce Trust provisions, without requirement to post bond.
(d) Recovery of damages, including reasonable attorneys’ fees and costs, payable solely from the Trust Estate unless due to Trustee’s bad faith or intentional misconduct.
7. RISK ALLOCATION
7.1 Trustee Indemnification
The Trust Estate shall indemnify and hold Trustee harmless against any claim, liability, or expense (including attorneys’ fees) arising from the administration of the Trust, except to the extent resulting from Trustee’s bad faith or intentional misconduct.
7.2 Limitation of Liability
Trustee’s liability to Beneficiaries shall be limited to the value of the Trust Estate; Trustee shall have no personal liability for Trust obligations.
7.3 Insurance
Trustee may obtain liability insurance payable from the Trust Estate and shall be an insured thereunder.
7.4 Force Majeure
Trustee shall not be liable for delays or failures in performance caused by events beyond Trustee’s reasonable control, including natural disasters, war, cyber-attacks, or changes in law rendering performance illegal.
8. DISPUTE RESOLUTION
8.1 Governing Law
This Agreement and the Trust shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to conflicts-of-law principles.
8.2 Forum Selection
Exclusive jurisdiction and venue for any judicial proceeding relating to this Trust shall lie in the Court of Chancery or the appropriate Probate Court of the State of Delaware.
8.3 Optional Arbitration
[OPTIONAL — SELECT IF DESIRED] Any dispute not resolved informally may, upon unanimous written agreement of all parties in interest, be submitted to binding arbitration administered by [ARBITRATION BODY] in Wilmington, Delaware, in accordance with its rules then in effect. Judgment on the award may be entered in any court of competent jurisdiction. Nothing in this Section shall preclude a party from seeking injunctive relief in a court of competent jurisdiction for Trust enforcement purposes.
8.4 Jury Waiver
To the extent permitted under applicable Delaware probate practice, the parties knowingly waive trial by jury in any proceeding concerning the Trust. This waiver shall not apply where Delaware law mandates bench proceedings without a jury.
8.5 Injunctive Relief
Nothing herein shall limit the right of any party to seek temporary, preliminary, or permanent injunctive relief for breach or threatened breach of fiduciary duties or other Trust provisions.
9. GENERAL PROVISIONS
9.1 Amendment & Waiver
Except as otherwise provided, any amendment or waiver must be in writing and executed by Settlor (while living) or, thereafter, by all current Beneficiaries and Trustee.
9.2 Assignment
No Beneficiary may assign or transfer any interest in the Trust except as expressly allowed herein.
9.3 Successors & Assigns
This Agreement shall be binding upon and inure to the benefit of Settlor, Trustee, Beneficiaries, and their respective heirs, legal representatives, and successors.
9.4 Severability
If any provision is held invalid or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be reformed to the minimum extent necessary to effectuate the Settlor’s intent.
9.5 Entire Agreement
This Agreement constitutes the entire understanding of the parties with respect to the subject matter and supersedes all prior discussions or agreements.
9.6 Counterparts; Electronic Signatures
This Agreement may be executed in counterparts, each of which shall be deemed an original. Signatures delivered electronically or by facsimile shall be deemed originals for all purposes.
10. EXECUTION BLOCK
IN WITNESS WHEREOF, Settlor and Trustee have executed this Revocable Living Trust Agreement as of the Effective Date first above written.
10.1 Settlor
[SETTLOR NAME], Settlor
Date: __
10.2 Trustee
[TRUSTEE NAME], Trustee
Date: __
[// GUIDANCE: Delaware does not require notarization for validity of a trust instrument, but notarization is recommended for evidentiary purposes.]
10.3 Notary Acknowledgment (Optional but Recommended)
State of __
County of __
On this _ day of _, 20__, before me, the undersigned Notary Public, personally appeared [SETTLOR NAME] and [TRUSTEE NAME], known to me (or satisfactorily proven) to be the persons whose names are subscribed to the foregoing instrument, and acknowledged that they executed the same for the purposes therein contained.
Notary Public
My Commission Expires: ____
11. SCHEDULE A – FUNDING SCHEDULE
[LIST OF ASSETS TRANSFERRED TO THE TRUST]
1. Checking Account No. [XXXX] at [BANK]
2. Brokerage Account No. [XXXX] at [BROKER]
3. Real Property: [LEGAL DESCRIPTION], located at [ADDRESS]
4. Tangible Personal Property per Assignment dated [DATE]
5. Other Assets: __________
[// GUIDANCE: Attach deeds, assignments, or transfer documents as needed. Ensure real property deeds are recorded promptly.]
[// GUIDANCE: Prior to execution, counsel should:
• Confirm compliance with 12 Del. C. §§ 3301–3595 and current Delaware fiduciary standards.
• Verify that all assets are properly titled in the name of the Trust.
• Review potential tax considerations, including grantor-trust status under Subpart E of Subchapter J of the Code.
• Customize dispositive provisions in Section 3.4 to reflect client objectives.]