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lifetime services and any attendant remuneration to the CFT,
petitioner received all 100 units of beneficial interest.
The CFT’s declaration of trust conferred on its trustees
broad authority to administer the trust. A majority of the
trustees constituted a quorum, and a majority vote of all
trustees was all that was required to authorize expenditures,
including the payment of compensation to the trustees. The
declaration of trust authorized the trustees to supplement the
trust instrument; a majority of the trustees then in office and
participating in the meeting needed only to adopt a resolution to
effect the change. The declaration of trust also provided that
“A Minute of Resolution of THE BOARD OF TRUSTEES authorizing what
it is they determine to do or have done shall be evidence that
such an act is within their power.”
Under its declaration of trust, the CFT had a term of 25
years. The trustees, however, could liquidate the CFT by
unanimous vote at any time “because of threatened depreciation in
values, or other good and sufficient reason”. Upon liquidation,
the assets of the CFT were to be distributed pro rata to those
persons having possession of the units of beneficial interest.
During the CFT’s existence, distribution of trust income was in
the trustees’ discretion.
The original trustees of the CFT were Mrs. Castro and Nelly
Castro (Nelly), petitioner’s mother. The declaration of trust
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Last modified: May 25, 2011