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The power of appointment that made the [post-September
25, 1985] transfer possible was created by the trust.
Language has to mean something, and the argument that
[the post-September 25,1985, transfer] * * * was not
“under” [the trust] * * * is simply untenable. [Id. at
814.]
Certainly, in Simpson the creation of the trust in 1966 made
“possible” the later, actual transfer that occurred in 1993. But
the “possibility” in 1966 of a later transfer and the “fact” of
the transfer in 1993 are two different things. In their
analyses, the Courts of Appeals for the Eighth and Ninth Circuits
seem erroneously to merge the creation of the possibility of a
transfer to grandchildren (via a transfer to a surviving spouse
of a general power of appointment) with the fact of a later,
actual transfer to grandchildren, as if they constituted the same
transfer.
In both Simpson and in Bachler the surviving spouse’s
testamentary exercise of a general power of appointment, and
thereby the post-September 25, 1985, skip transfers to
grandchildren, were “made possible under” the trusts, but the
skip transfers did not “occur under” the trusts. They occurred
under the general power of appointment given to the surviving
spouse by the trust creator, the predeceased husband. Under that
general power of appointment, the surviving spouse need not have
made skip transfers and could have transferred the property to
anyone she wished.
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