A permissible beneficiary’s equitable property interest under a discretionary trust is contingent, not vested. The critical condition precedent that renders the interest contingent is that the trustee must exercise his discretion in order for a portion or all of the trust estate to vest in the beneficiary. There are two important policy exceptions: (1) When the beneficiary is also the settlor such that the trust property is subject to the claims of the settlor-beneficiary’s creditors and (2) when the beneficiary simultaneously possesses a non-fiduciary general inter vivos power to appoint the entrusted property. Occasionally these two policy exceptions will merge into a single exception, a topic that is covered in §4.1.3 of Loring and Rounds: A Trustee’s Handbook [pages 278-280 of the 2015 Edition] (creditor accessibility as a general inter vivos power of appointment). Nowhere is there more confusion over what equitable property interests under trusts are vested and what are contingent than at the intersection of divorce and property law. Take the divorce case of Pfannenstiehl vs. Pfannenstiehl, decided August 27, 2015 (Appeals Court of Massachusetts, Norfolk). The husband was one of a number of permissible beneficiaries under an irrevocable discretionary trust established by his father. The majority characterized his equitable property interest as vested. The dissent characterized the interest as contingent. It is suggested that the dissent got it right. In Charles E. Rounds, Jr. & Charles E. Rounds, III, Loring and Rounds: A Trustee’s Handbook, vested and contingent equitable property interests under trusts are discussed generally in §5.3.1. The section is reproduced in its entirety below.