Trusts – Spendthrift Trusts – Reduction in Income as Justification for Termination in Favor of Beneficiary
Testatrix died in 1913 leaving a will which established a $20,000 spendthrift trust. The income from this trust was to be paid to her son for life with the remainder, in default of issue and the exercise of a general testamentary power of appointment, to go to the other descendants of the testatrix then living. The stated purpose of the trust was to assure her son of “a support throughout his . . . whole life, under any circumstances.” The son, 65 years old and without issue, sought to terminate the trust on the ground that he was about to be retired with little probability of obtaining further employment and faced the prospect of being unable to support himself and his wife. The income of the trust had fallen substantially and at the time amounted to only $660 a year. The lower court allowed a partial invasion of the corpus. On appeal, held, reversed. After the death of the settlor a partial reduction of income is insufficient to constitute such a failure of purpose of a spendthrift trust as to warrant its termination or modification, when such a decree would benefit the life tenant. In re Bosler’s Estate, 378 Pa. 333, 107 A. (2d) 443 (1954).