Just because Minnesota has an oral trust agreement law, doesn’t mean we should rely on it in a time of need.
None the less, the MN law that allows a verbal trust agreement in certain situations might come in handy during desperate times.
Still, the preferred method of creating a formal written document should always be the first and second option.
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Oral trusts are a risky and unreliable way to manage or transfer assets. While some jurisdictions may recognize them in limited circumstances, they are notoriously difficult to prove and enforce.
Obviously, oral trusts lack clear documentation, which makes it easy for misunderstandings, disputes, and legal challenges to arise—especially among heirs or beneficiaries.
In court, proving the existence and terms of an oral trust often relies on witness testimony or circumstantial evidence, which is vulnerable to contradiction or misinterpretation.
Without written instructions, there’s no definitive record of the settlor’s intent, the assets involved, or how they should be distributed. This can lead to prolonged litigation, strained family relationships, and unintended beneficiaries receiving property.
In short, an oral trust is a legal gamble. To protect your assets, ensure your wishes are carried out, and avoid unnecessary drama, always formalize your trust in writing with qualified legal guidance.