In New York, Trusts Are Irrevocable By Default

In New York, a trust does not have to say it is irrevocable, as that is the default.

EPTL 7-1.16 (Revocation of lifetime trust by will) provides, in relevant part:

A lifetime trust shall be irrevocable unless it expressly provides that it is revocable. . . .

So, the analysis is not whether the trust says it is "irrevocable." Rather, does the trust say or do its terms indicate that it is "revocable"?

As a drafting best practice, I think trusts should explicitly state whether they are revocable or irrevocable, but under EPTL 7-1.16, stating that a trust is irrevocable isn't necessary.

EPTL 7-1.16 became effective June 25, 1997.

Recently, the New York State Bar Association's Trusts and Estate Law Section (TESL) rejected a proposal to change the default rule regarding the irrevocability of trust.

Section 7-A-6.2(a) was proposed, which read:

Section 7-A-6.2 Revocation or Amendment of Revocable Trust

(a) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. This subdivision does not apply to a trust created under an instrument executed before [the effective date of [this Article]].

In Commentary and Recommendations to the New York State Legislature on the Sixth Report of the EPTL-SCPA Legislative Advisory Committee, the TESL rejected proposed Section 7-A-6.2 in favor of the "long-standing rule" that trusts in New York are presumed to be irrevocable:

III. RECOMMENDATIONS

The TELS determined not to modify the long-standing rule of New York law, codified in EPTL 7-1.16, that a trust is presumed to be irrevocable unless the trust terms expressly provides that it is revocable, and therefore recommends that section 7-A-6.2(a) as proposed by the 6th Report be deleted. . . .

So, irrevocable trusts are likely to stay the default in New York. A settlor can aopt-out by explicitly stating that the trust is revocable.