Nina Hebibovich

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Case Synopsis

The Court determined whether a creditor of a settlor can satisfy its claim against the settlor’s trust in situations where the trustees approve the payment, but the trust does not expressly provide for payment of the claim. When the settlor’s interest in the trust is not exclusively discretionary, and there is not a profligate provision precluding payment of the claim, the Court held that a creditor may bring a claim against a settlor of a trust. In instances of a trust granting broad discretion to its trustees, the trustees may approve a creditor’s claim against the trust. In this matter, the Court affirmed a creditor’s claim because it was proper, and the trustees were within their broad discretion in approving the claim.