American Security and Trust Company v. Freda Utley

BURGER, Circuit Judge:

This appeal presents to us the question whether the income provided for the beneficiary of a spendthrift trust is subject to the claim of a creditor, and if so, to what extent. The District Court determined that because the beneficiary was the trust settlor’s spouse, who elected to take under the will creating the trust, rather than under the provisions of the statute, D.C.Code § 19-113 (1961), the income was subject to claims of creditors. We reverse and remand for a factual determination arising out of a modification of the rule relating to spendthrift trustees.

Sidney…