Constructive Trust

If a property owner is induced to make an absolute gift to the defendant by will due to reliance on an oral promise by the defendant to apply all or part of the property to the use of another designated person and, after the death of the testator, the defendant refuses to do as promised, he or she can be made a constructive trustee. The same result will hold when the property owner is induced to die intestate on the faith of an oral agreement by his or her heir or next of kin.

If the recipient by will or intestacy promises to hold for others to be later described by the property owner and no description is communicated to the recipient until after the death of the property owner, the recipient will hold as a trustee of a RESULTING TRUST for the heirs, next of kin, or residuary legatees or devisees of the property owner. No trust will be established for the intended beneficiaries but such persons might take the property as the recipients of the resulting trust.

If a will provides that a gift is to be made to a recipient as trustee, but no description of the beneficiary appears in the will, and the recipient verbally agrees to hold it for beneficiaries who are orally or otherwise informally described to the recipient, the successors of the decedent can enforce a resulting trust in their favor against the recipient. The courts rely on the argument that a property owner who wishes the property to pass to others than the heirs at his or her death must give it to those others by a formally executed will.