These strict requirements were imposed in 1997 in recognition that adherence to formality "reduces substantially the potential for foul play." Fasano v. DiGiacomo, 49 A.D.3d 683, 685 (2d Dept. 2008) (quoting Senate Introducer Mem. in Support, Bill Jacket, L. 1997, ch. 139, at 8). If the formalities are not observed, a valid trust is not formed, and subsequent transactions entered into by the invalid trust may be declared null and void.
To show the existence of a trust at that time, the trustee was not required to sign the trust agreement. With the enactment of EPTL 7–1.17 in 1997, however, certain formal requirements were imposed for the creation, amendment and revocation of lifetime trusts ( Matter of Fasano, 49 A.D.3d 683, 853 N.Y.S.2d 657 [2d Dept. 2008], lv. denied11 N.Y.3d 710, 868 N.Y.S.2d 602, 897 N.E.2d 1086 [2008] ). The court in Fasano noted that:
In general, if a trust is not properly formed, it cannot enter into a contract. See , e.g. , Fasano v. DiGiacomo , 49 A.D.3d 683, 685, 853 N.Y.S.2d 657, 659 (2d Dep’t 2008). Lincoln argues that the Trust was not compliant with New York law because Fischer’s signature establishing the Trust was a forgery.
The New York legislature established formal requirements for lifetime trusts in 1997, including that a lifetime trust in personal property be in writing. See Fasano v. DiGiacomo, 49 A.D.3d 683, 853 N.Y.S.2d 657, 659 (2d Dep't 2008) ( citing Practice Commentaries to EPTL 7–1.17); see alsoRestatement (Third) of Trusts § 20 (2003). In affidavits submitted in support of the motion to impose a constructive trust, the Debtor and Defendant allege that the Defendant “allowed” title to the Vehicle to be in the Debtor's name “on [the] basis of a relationship of trust and confidence,” and that Defendant “fully performed his end of the agreement, having made ALL payments for the purchase of the Vehicle and having fully paid the Note on the Vehicle.”