I previously wrote about “incentive trusts” here. Professor Joshua C. Tate (Associate Professor, SMU Dedman School of Law) has recently released an article addressing these types of trusts entitled “Conditional Love: Incentive Trusts and the Inflexibility Problem,” 41 REAL PROP., PROB. & TR. J. (forthcoming 2006). Here is the SSRN abstract of Prof. Tate’s article:
Abstract: This Article examines the contemporary phenomenon of incentive trusts: trusts that use money to encourage or discourage certain behaviors. Using evidence from Internet websites, practitioner articles, and newspaper articles, the Article considers the likely provisions that a typical incentive trust might have, and explains how such trusts might lead to a problem of inflexibility when they are not drafted so as to take into account the possibility of changed circumstances. The Article also examines current law regarding trust modification and termination as well as recent reform proposals, and suggests some alternatives that might better take into account the particular characteristics of incentive trusts.
Thanks to Wills, Trusts & Estates Prof Blog for pointing out this article.