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REFORMATION OF A TESTAMENTARY TRUST PERMITTED TO AS TO ESTABLISH A THIRD PARTY SUPPLEMENTAL NEEDS TRUST
An application was made to the Nassau County Surrogate to reform a testamentary trust (the “Trust”) set forth in a codicil to a will of the decedent (the “Will”). The Trust was created for a disabled son. The petitioner, a co-trustee of the Trust, was concerned that the disabled son’s medical expenses may result in an exhaustion of the Trust prior to the son’s death. It was not clear why the son would not have been entitled to Medicaid benefits based on what appeared to be a fully discretionary third party trust. In any event, the petitioner proposed specific supplemental needs trust language for inclusion in the Trust. In response, the Surrogate indicated that a trust should not be reformed unless the reformation will carry out the intent of the testator. Based on the language in the Will, the Surrogate found that the requested reformation did not alter the decedent’s testamentary plan and was in the best interests of the beneficiary. The application was approved.
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