Legal Definitions - appointees

In legal terms, particularly concerning a 'power of appointment,' appointees are the specific individuals or entities who are chosen to receive assets or benefits. A power of appointment is an authority granted to one person (often called the 'donee' or 'power holder') to decide who, from a designated group of potential recipients, will ultimately receive certain property or funds. The appointees are those individuals or entities actually selected by the donee to receive these assets.

• Example 1: Family Trust Distribution

  A grandmother establishes a trust for her grandchildren, stating that her son, David (the donee), has the authority to decide how to distribute a specific portion of the trust's funds among his three children (the objects of the power) when they reach the age of 25. When the time comes, David decides to allocate 50% of the funds to his eldest daughter, Sarah, and 25% to each of his two younger sons, Michael and James.

  In this scenario, Sarah, Michael, and James are the appointees because David, exercising the power of appointment granted to him by his mother, specifically selected them to receive the trust assets.

• Example 2: Scholarship Fund Selection

  A university alumni association creates a special scholarship fund. The fund's charter grants the association's scholarship committee (the donee) the power to select up to five deserving students each year from the pool of all current undergraduate applicants (the objects of the power) to receive a full-tuition scholarship. After a thorough review process, the committee chooses two engineering students, one history major, one nursing student, and one fine arts student for the current academic year.

  The five selected students are the appointees because the scholarship committee, acting as the donee, exercised its power to choose them from the larger group of eligible applicants to receive the scholarships.

• Example 3: Corporate Board Succession

  A company's bylaws include a provision that allows the outgoing CEO (the donee) to appoint up to two individuals from the executive leadership team (the objects of the power) to fill newly created advisory board positions upon the CEO's retirement. Before stepping down, the CEO selects the Chief Technology Officer and the Head of Global Sales to join the advisory board.

  The Chief Technology Officer and the Head of Global Sales are the appointees because the retiring CEO, utilizing the power granted by the company's bylaws, specifically chose them from the executive leadership team to fill the advisory board roles.