The power to make gifts under a power of attorney (POA) & a trust; Park v. Appeal Bd. of MI Employment Sec. Comm’n; In re Cummin Estate; In re Miller Osborne Perry Trust; In re Raymond Estate; Patent ambiguity; In re Woodworth Trust; Discretionary trust; In re Johannes Trust; The Michigan Trust Code (MCL 700.7101 et seq.); MCL 700.7105(2)(b); MCL 700.7801; MCL 700.7816(2); MCL 700.7815; MCL 700.7103(b); “Ascertainable standard”; §§ 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code (26 USC §§ 2041 & 2514); Determination that a “Demand Promissory Note” was not discharged; MCL 440.3104(4); “Instrument”; MCL 440.3104(2); MCL 556.1; Adequate consideration; General Motors Corp. v. Department of Treasury

The probate court correctly concluded that both the POA and the Trust gave respondent power to make limited gifts to himself and to third parties. But it erred by determining that respondent’s power to make distributions was limited by the gift-giving provision of the Trust; the Trust also gave him discretion to distribute the Trust’s assets for the beneficiaries’ benefit. Yet this discretion was not unlimited, and there were factual questions about whether the distributions and gifts he made under the terms of the Trust violated Michigan law. However, the probate court reached the right result as to a “Demand Promissory Note.” Respondent appealed the probate court’s order granting partial summary disposition to petitioners.. In a cross-appeal, petitioners appealed the probate court’s holding that respondent was authorized under the terms of the Stephenson Family Revocable Living Trust (the Trust) and/or the POA “for Vernon Stephenson to make limited gifts and disbursements to himself and his children.” The court rejected petitioners’ argument that respondent was prohibited from making gifts to himself or his children under Vernon’s POA or the Trust. It held that respondent had the authority under the POA “to make limited gifts, including gifts to himself.” Further, turning to the Trust, the court concluded “that the terms of the Trust gave respondent the authority to make disbursements and limited gifts to himself and his children.” Petitioners argued that reading certain provisions of the Trust in combination with others created an ambiguity. However, the court determined that when reading the Trust as a whole, it was “clear that the decedents’ intent was for them to retain exclusive control except in the event that they became incapacitated.” Thus, it concluded that there was “no patent ambiguity in the Trust.” Affirmed in part, reversed in part, and remanded.