MHL ARTICLE 81 - New York State Unified Court System

Contrast
DiGennerro v. Community Hospital of Glen Cove, 204 A.D.2d 259; 611 N.Y.S.2d 591 (2 nd
Dept., 1994)
Establishment of SNT denied where trust named infant's parents as both co-trustees and beneficiaries
of trust corpus upon infant's death, which presents serious conflict of interest. Additionally, there was
no provision in trust instrument for court approval of withdrawals made by trustees, nor was there
any requirement that trustees account to court on annual or bi-annual basis.
Matter of Mc Mullen, 166 Misc.2d 117; 632 N.Y.S.2d 401 (Sup. Ct., Suffolk Cty., 1995)
A request by parents (co-guardians) of incapacitated child for authorization to establish SNT is
denied where co-trustees are also potential remaindermen, since this arrangement creates an
impermissible conflict.
Matter of De Vita, NYLJ, 2/17/95, p. 33, col. 5 (Sup. Ct., Suffolk Cty., 1995)
2/17/95--A mother and father applied for an order approving SNT for incapacitated son’s personal
injury award with the mother to serve as trustee. The mother also served as guardian. Court denies
request because trustee gives accountings to guardian and requiring her to report to herself is an
impermissible conflict of interest.
5/22/95– Prior problem with inadequate accounting was resolved with provision requiring that
copies of trust’s federal tax return be submitted to father and court examiner as well as herself as
guardian. However, court still did not approve SNT because mother, who served as trustee, still
stood to benefit by another provision distributing all remaining principal and income by the laws of
intestacy. This was an impermissible conflict of interest, despite fact that any money left would be
negligible.
c. Pooled trusts
Matter of Steven Siegel, 5/30/08, Index #18311/06 (Sup. Ct., Suff. Cty) (Sgroi, J.) (unpublished)
Where application was made by the Consumer Advisory Board (“CAB”) to place a Willowbrook
Class AIP’s $68,000 retroactive Social Security payment into a pooled trust , MHLS, on behalf of
the AIP, successfully advocated for the establishment instead of an individual SNT. The Court held
that the individual SNT was appropriate and indicated its belief that such an individual trustee would
be more responsive to the needs of the AIP than might be the case with a pooled trust. The Court
directed that the trust should include language directing the trustee to consult with CAB as to how
the money could best be used to meet the AIP’s needs.
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