Self-Settled Trusts and Fraudulent Transfers (Illinois)

By Matthew A. Quick The case of Rush University Medical Center v Sessions opined that a decedent's transfer of assets to his self-settled spendthrift trust may be set aside and a creditor may reach trust assets under the Fraudulent Transfer Act, 740 ILCS 160/1, et seq., which requires a creditor to satisfy conditions of intent, thus, the common law rule that self-settled trusts are per se fraudulent requires the additional intent element to satisfy an action under the Fraudulent Transfer Act. In addition to an action under the Fraudulent Transfer Act, a creditor may maintain an action under common law that seeks to set aside self-settled trusts in all instances with respect to existing or future creditors.