Not sure your question is understood, however you really should consult with an attorney who specializes in Trusts and Estates.

Ivy,
If I understand your question, can someone leave their granddaughter a home in the midst of a short sale? While I'm not an attorney, I would ask why would they want to? If the home has no equity and is in the process of being sold it would have no value to someone they loved.
If it was part of a trust with other items of value it may even cause the trust to be forced to sell off other parts to cover some costs not permitted by the lender in the short sale.
Your final answer will need to come from an attorney familiar with the estate and the trust involved. If there is still time to remove this home from the trust, it may be in everyone’s best interest to do so, but again, talk to an attorney.

not sure what your question means - if you're asking if a grandparent can leave a home that is in foreclosure to his grandkid the answer is no.

of course talk with an attorney and i am not 100% sure about your question.

IF you're asking can a grandparent sell a home to a grandkid via short sale - the answer is no - any short sale transaction MUST BE "arms length" - no relation to seller.