Protection against creditors for other members of the Beneficiary Class of a Model Offshore Trust is even stronger than the protection for the Grantor. Because the Trustee has discretion to apportion benefits, no Beneficiary has a fixed or determinable interest in the Trust Fund that he can lose to a creditor — nothing he can be forced assign to the winner of a lawsuit.
Even if a Beneficiary were under a court order to pay his creditor any money he receives from the Trust, the creditor still would get nothing against the Beneficiary’s wishes. The Trustee, upon notification of the order, would have a duty under the Model Terms of Trust to suspend distributions that it determined would not be used for the Beneficiary’s benefit.
Thus if the Trustee determined that the Beneficiary did not want money from the Trust Fund to be used to pay the creditor, it would not be.
The Trustee still could provide benefits to the Beneficiary indirectly, however. For example, the Trustee could draw on the Trust Fund to pay the Beneficiary’s credit card or other bills. And if the Beneficiary’s spouse, children or other relatives were included in the Beneficiary Class, the Trustee could make distributions to (or for) them.
A Broad Umbrella
Any member of the Beneficiary Class can use the Trust to protect his own personal assets without transferring them to the Trust.
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