Can a Florida Court Reform a Trust to Correct a Mistake?

Reformation is a court remedy for a trust instrument whose terms do not carry out what the settlor intended. The power applies even when the language is clear on its face, so an unambiguous trust can still be reformed if the required proof is made.

The mistake may be one of fact or of law. It may also be a mistake in expression, where the written terms do not reflect what was intended, or a mistake in inducement, where the intended terms were themselves based on a mistaken belief. In either case, the evidence must show that the mistake affected both the terms of the trust and the accomplishment of the settlor's intent.

Evidence outside the trust instrument is allowed. In determining the settlor's original intent, the court may consider evidence relevant to that intent even though it contradicts an apparent plain meaning of the trust instrument.

A related power addresses taxes. On application of any interested person, the court may modify the terms of a trust to achieve the settlor's tax objectives, in a manner that is not contrary to the settlor's probable intent, and the court may give the modification retroactive effect.

These court powers are separate from the changes a settlor can make to a revocable trust during life. How a revocable trust works is explained in revocable living trusts.