Longoria v. Lasater, 292 S.W.3d 156 (Tex. App.—San Antonio 2009, pet. denied).



Deceased Person as Beneficiary


In 1924, a partition agreement and decree created a trust of real property in favor of named beneficiaries. Disagreement arose over a 1950 deed which covered the same property – did the 1950 deed (1) continue the 1924 trust or (2) create a new trust? The appellate court determined that because one of the beneficiaries of the 1924 trust died prior to the 1950 deed, his portion of the property was not covered by the 1950 deed. The court relied on established Texas law as well as the Restatement (Second) of Trusts when it held that a person cannot be a beneficiary of a trust if that person dies prior to the date of trust creation. Because the 1950 deed did not create a trust with regard to the predeceased beneficiary’s portion of the 1924 trust, the appellees could not prevail because the alleged trustees held the property either free of trust or as a resulting trust.

Moral: Complex land transactions can trigger disputes many decades later. Accordingly, great care needs to be taken to be sure “simple” mistakes are not made such as naming a deceased person as the beneficiary of a trust.