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S.B. 43

             1     

UNIFORM TRUST ACT

             2     
2002 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Sponsor: Lyle W. Hillyard

             5      This act repeals Title 75, Chapter 7, Trust Administration, and enacts the Utah Uniform
             6      Trust Code in its place.
             7      This act affects sections of Utah Code Annotated 1953 as follows:
             8      AMENDS:
             9          7-5-7, as last amended by Chapter 196, Laws of Utah 1994
             10          7-5-10, as last amended by Chapter 6, Laws of Utah 1982
             11          7-5-14, as last amended by Chapter 267, Laws of Utah 1989
             12          49-1-303, as enacted by Chapter 1, Laws of Utah 1987
             13          75-3-703, as enacted by Chapter 150, Laws of Utah 1975
             14          75-3-913, as enacted by Chapter 150, Laws of Utah 1975
             15          75-5-417, as last amended by Chapter 119, Laws of Utah 1995
             16      ENACTS:
             17          75-7-102, Utah Code Annotated 1953
             18          75-7-103, Utah Code Annotated 1953
             19          75-7-104, Utah Code Annotated 1953
             20          75-7-105, Utah Code Annotated 1953
             21          75-7-106, Utah Code Annotated 1953
             22          75-7-107, Utah Code Annotated 1953
             23          75-7-108, Utah Code Annotated 1953
             24          75-7-109, Utah Code Annotated 1953
             25          75-7-110, Utah Code Annotated 1953
             26          75-7-111, Utah Code Annotated 1953
             27          75-7-112, Utah Code Annotated 1953


             28          75-7-412, Utah Code Annotated 1953
             29          75-7-413, Utah Code Annotated 1953
             30          75-7-414, Utah Code Annotated 1953
             31          75-7-415, Utah Code Annotated 1953
             32          75-7-416, Utah Code Annotated 1953
             33          75-7-417, Utah Code Annotated 1953
             34          75-7-502, Utah Code Annotated 1953
             35          75-7-503, Utah Code Annotated 1953
             36          75-7-504, Utah Code Annotated 1953
             37          75-7-505, Utah Code Annotated 1953
             38          75-7-506, Utah Code Annotated 1953
             39          75-7-507, Utah Code Annotated 1953
             40          75-7-601, Utah Code Annotated 1953
             41          75-7-602, Utah Code Annotated 1953
             42          75-7-603, Utah Code Annotated 1953
             43          75-7-604, Utah Code Annotated 1953
             44          75-7-701, Utah Code Annotated 1953
             45          75-7-702, Utah Code Annotated 1953
             46          75-7-703, Utah Code Annotated 1953
             47          75-7-704, Utah Code Annotated 1953
             48          75-7-705, Utah Code Annotated 1953
             49          75-7-706, Utah Code Annotated 1953
             50          75-7-707, Utah Code Annotated 1953
             51          75-7-708, Utah Code Annotated 1953
             52          75-7-709, Utah Code Annotated 1953
             53          75-7-801, Utah Code Annotated 1953
             54          75-7-802, Utah Code Annotated 1953
             55          75-7-803, Utah Code Annotated 1953
             56          75-7-804, Utah Code Annotated 1953
             57          75-7-805, Utah Code Annotated 1953
             58          75-7-806, Utah Code Annotated 1953


             59          75-7-807, Utah Code Annotated 1953
             60          75-7-808, Utah Code Annotated 1953
             61          75-7-809, Utah Code Annotated 1953
             62          75-7-810, Utah Code Annotated 1953
             63          75-7-811, Utah Code Annotated 1953
             64          75-7-812, Utah Code Annotated 1953
             65          75-7-813, Utah Code Annotated 1953
             66          75-7-814, Utah Code Annotated 1953
             67          75-7-815, Utah Code Annotated 1953
             68          75-7-816, Utah Code Annotated 1953
             69          75-7-817, Utah Code Annotated 1953
             70          75-7-901, Utah Code Annotated 1953
             71          75-7-902, Utah Code Annotated 1953
             72          75-7-903, Utah Code Annotated 1953
             73          75-7-904, Utah Code Annotated 1953
             74          75-7-905, Utah Code Annotated 1953
             75          75-7-906, Utah Code Annotated 1953
             76          75-7-1001, Utah Code Annotated 1953
             77          75-7-1002, Utah Code Annotated 1953
             78          75-7-1003, Utah Code Annotated 1953
             79          75-7-1004, Utah Code Annotated 1953
             80          75-7-1005, Utah Code Annotated 1953
             81          75-7-1006, Utah Code Annotated 1953
             82          75-7-1007, Utah Code Annotated 1953
             83          75-7-1008, Utah Code Annotated 1953
             84          75-7-1009, Utah Code Annotated 1953
             85          75-7-1010, Utah Code Annotated 1953
             86          75-7-1011, Utah Code Annotated 1953
             87          75-7-1012, Utah Code Annotated 1953
             88          75-7-1013, Utah Code Annotated 1953
             89          75-7-1101, Utah Code Annotated 1953


             90          75-7-1102, Utah Code Annotated 1953
             91          75-7-1103, Utah Code Annotated 1953
             92      REPEALS AND REENACTS:
             93          75-7-101, as enacted by Chapter 150, Laws of Utah 1975
             94          75-7-201, as enacted by Chapter 150, Laws of Utah 1975
             95          75-7-202, as last amended by Chapter 119, Laws of Utah 1995
             96          75-7-203, as last amended by Chapter 194, Laws of Utah 1977
             97          75-7-204, as enacted by Chapter 150, Laws of Utah 1975
             98          75-7-301, as enacted by Chapter 150, Laws of Utah 1975
             99          75-7-302, as repealed and reenacted by Chapter 119, Laws of Utah 1995
             100          75-7-303, as last amended by Chapter 179, Laws of Utah 1992
             101          75-7-304, as enacted by Chapter 150, Laws of Utah 1975
             102          75-7-305, as enacted by Chapter 150, Laws of Utah 1975
             103          75-7-401, as last amended by Chapter 39, Laws of Utah 1998
             104          75-7-402, as last amended by Chapter 179, Laws of Utah 1992
             105          75-7-403, as last amended by Chapter 119, Laws of Utah 1995
             106          75-7-404, as last amended by Chapter 133, Laws of Utah 1991
             107          75-7-405, as enacted by Chapter 150, Laws of Utah 1975
             108          75-7-406, as enacted by Chapter 150, Laws of Utah 1975
             109          75-7-407, as enacted by Chapter 150, Laws of Utah 1975
             110          75-7-408, as enacted by Chapter 150, Laws of Utah 1975
             111          75-7-409, as last amended by Chapter 320, Laws of Utah 2000
             112          75-7-410, as enacted by Chapter 196, Laws of Utah 1999
             113          75-7-411, as enacted by Chapter 196, Laws of Utah 1999
             114          75-7-501, as enacted by Chapter 54, Laws of Utah 1982
             115      REPEALS:
             116          75-7-205, as enacted by Chapter 150, Laws of Utah 1975
             117          75-7-206, as enacted by Chapter 150, Laws of Utah 1975
             118          75-7-207, as enacted by Chapter 150, Laws of Utah 1975
             119          75-7-306, as last amended by Chapter 179, Laws of Utah 1992
             120          75-7-307, as last amended by Chapter 30, Laws of Utah 1992


             121      Be it enacted by the Legislature of the state of Utah:
             122          Section 1. Section 7-5-7 is amended to read:
             123           7-5-7. Management and investment of trust funds.
             124          (1) Funds received or held by any trust company as agent or fiduciary, whether for
             125      investment or distribution, shall be invested or distributed as soon as practicable as authorized
             126      under the instrument creating the account and shall not be held uninvested any longer than is
             127      reasonably necessary.
             128          (2) If the instrument creating an agency or fiduciary account contains provisions
             129      authorizing the trust company, its officers, or its directors to exercise their discretion in the matter
             130      of investments, funds held in the trust account under that instrument may be invested only in those
             131      classes of securities which are approved by the directors of the trust company or a committee of
             132      directors appointed for that purpose. If a trust company acts in any agency or fiduciary capacity
             133      under appointment by a court of competent jurisdiction, it shall make and account for all
             134      investments according to the provisions of Title 75, Utah Uniform Probate Code, unless the
             135      underlying instrument provides otherwise.
             136          (3) (a) Funds received or held as agent or fiduciary by any trust company which is also a
             137      depository institution, whether for investment or distribution, may be deposited in the commercial
             138      department or savings department of that trust company to the credit of its trust department.
             139      Whenever the funds so deposited in a fiduciary or managing agency account exceed the amount
             140      of federal deposit insurance applicable to that account, the trust company shall deliver to the trust
             141      department or put under its control collateral security as outlined in Regulation 9.10 of the
             142      Comptroller of the Currency or in Regulation 550.8 of the Office of Thrift Supervision, as
             143      amended. However, if the instrument creating such a fiduciary or managing agency account
             144      expressly provides that funds may be deposited to the commercial or savings department of the
             145      trust company, then the funds may be so deposited without setting aside collateral securities as
             146      required under this section and the deposits in the event of insolvency of any such trust company
             147      shall be treated as other general deposits are treated. A trust company which deposits trust funds
             148      in its commercial or savings department shall be liable for interest on the deposits only at the rates,
             149      if any, paid by the trust company on deposits of like kind not made to the credit of its trust
             150      department.
             151          (b) Funds received or held as agent or fiduciary by a trust company, whether for


             152      investment or distribution, may be deposited in an affiliated depository institution. Whenever the
             153      funds so deposited in a fiduciary or managing agency account exceed the amount of federal deposit
             154      insurance applicable to that account, the depository institution shall deliver to the trust company
             155      or put under its control collateral security as outlined in Regulation 9.10 of the Comptroller of the
             156      Currency or in Regulation 550.8 of the Office of Thrift Supervision as amended. However, if the
             157      instrument creating the fiduciary or managing agency account expressly permits funds to be
             158      deposited in the affiliated depository institution, the funds may be so deposited without setting
             159      aside collateral securities as required under this section and deposits in the event of insolvency of
             160      the depository institution shall be treated as other general deposits are treated. A trust company
             161      which deposits trust funds in an affiliated depository institution is liable for interest on the deposits
             162      only at the rates, if any, paid by the depository institution on deposits of like kind.
             163          (4) In carrying out all aspects of its trust business, a trust company shall have all the
             164      powers, privileges, and duties as set forth in [Section 75-7-402 ] Sections 75-7-815 and 75-7-816
             165      with respect to trustees, whether or not the trust company is acting as a trustee as defined in Title
             166      75, Utah Uniform Probate Code.
             167          (5) Nothing in this section may alter, amend, or limit the powers of a trust company acting
             168      in a fiduciary capacity as specified in the particular instrument or order creating the fiduciary
             169      relationship.
             170          Section 2. Section 7-5-10 is amended to read:
             171           7-5-10. Lending trust funds to trust company, officer, director, or employee as
             172      felony.
             173          Unless expressly permitted in the instrument creating a trust account or by a person
             174      authorized to give that permission or by a court order as permitted in Section [ 75-7-404 ] 75-7-802,
             175      no trust company shall lend to itself or to any officer or director or employee of the trust company
             176      any funds held in any trust account under the powers conferred in this chapter. Any officer,
             177      director, or employee making such a loan, or to whom such a loan is made, is guilty of a third
             178      degree felony.
             179          Section 3. Section 7-5-14 is amended to read:
             180           7-5-14. Mergers, consolidations, acquisitions, transfers, or reorganizations involving
             181      entities engaged in trust business -- Succession of rights and duties -- Petition for
             182      appointment of another trust company.


             183          (1) Notwithstanding any provision of law to the contrary, a trust company, depository
             184      institution, or other corporation authorized under this chapter or under the laws of the United
             185      States to engage in the trust business in this state may, subject to the provisions of Sections
             186      7-1-702 , 7-1-704 , and 7-1-705 :
             187          (a) (i) merge or consolidate with[,]:
             188          (ii) acquire control of, acquire all or a portion of the assets and trust business of, or assume
             189      all or any portion of the liabilities of[,]; or
             190          (iii) transfer control to, transfer all or a portion of its assets and trust business to, or
             191      transfer all or a portion of its liabilities to, any other trust company, depository institution, or other
             192      corporation, which institution is authorized under this chapter or under the laws of the United
             193      States to engage in the trust business in this state; or
             194          (b) reorganize.
             195          (2) Upon final approval by the commissioner of any merger, consolidation, acquisition of
             196      control, acquisition of assets, assumption of liabilities, or reorganization, and upon written notice
             197      of this approval to all persons entitled to and then receiving trust accountings from the transferring
             198      or reorganizing trust company, the resulting or acquiring trust company shall, without court
             199      proceedings or a court order, succeed to all rights, privileges, duties, obligations, and undertakings
             200      under all trust instruments, agency and fiduciary relationships and arrangements, and other trust
             201      business transferred and acquired in the manner authorized by this section. However, except as
             202      provided otherwise in the relevant trust instrument, any interested person may, not more than 30
             203      days after receipt of written notice of the merger, consolidation, acquisition, transfer, or
             204      reorganization, petition any court of competent jurisdiction to appoint another or succeeding trust
             205      company with respect to any agency or fiduciary relationship affecting that interested person, and
             206      until another or succeeding trust company is so appointed, the acquiring or resulting trust company
             207      is entitled to act as agent or fiduciary with respect to the agency or fiduciary relationship. [No
             208      merger, consolidation, acquisition, assumption, or reorganization pursuant to this section shall be
             209      deemed to be a transfer which is prohibited by Section 75-7-403 .]
             210          (3) As used in this section, a "reorganization" includes, but is not limited to:
             211          (a) the creation by a trust company of a subsidiary corporation which is wholly-owned by
             212      that trust company and which is organized solely for the purpose of conducting all or any portion
             213      of the trust business of that trust company; or


             214          (b) any merger or other combination between a trust company and:
             215          (i) a wholly-owned trust company subsidiary of that trust company; or
             216          (ii) a wholly-owned trust company subsidiary of the depository institution holding
             217      company which owns or controls that trust company.
             218          Section 4. Section 49-1-303 is amended to read:
             219           49-1-303. Fund investment standard -- Prudent man rule.
             220          The fund shall be invested in accordance with the prudent man rule established [under
             221      Section 75-7-302 ] in Title 75, Chapter 7, Part 9, Utah Uniform Prudent Investor Act.
             222          Section 5. Section 75-3-703 is amended to read:
             223           75-3-703. General duties -- Relation and liability to persons interested in estate --
             224      Standing to sue.
             225          (1) A personal representative is a fiduciary who shall observe the standard of care
             226      applicable to trustees as described by Section [ 75-7-302 ] 75-7-902 . A personal representative is
             227      under a duty to settle and distribute the estate of the decedent in accordance with the terms of any
             228      probated and effective will and this code and as expeditiously and efficiently as is consistent with
             229      the best interests of the estate. He shall use the authority conferred upon him by this code, the
             230      terms of the will, if any, and any order in proceedings to which he is party for the best interests of
             231      successors to the estate.
             232          (2) A personal representative shall not be surcharged for acts of administration or
             233      distribution if the conduct in question was authorized at the time. Subject to other obligations of
             234      administration, an informally probated will is authority to administer and distribute the estate
             235      according to its terms. An order of appointment of a personal representative, whether issued in
             236      informal or formal proceedings, is authority to distribute apparently intestate assets to the heirs of
             237      the decedent if, at the time of distribution, the personal representative is not aware of a pending
             238      testacy proceeding, a proceeding to vacate an order entered in an earlier testacy proceeding, a
             239      formal proceeding questioning his appointment or fitness to continue, or a supervised
             240      administration proceeding. Nothing in this section affects the duty of the personal representative
             241      to administer and distribute the estate in accordance with the rights of claimants, the surviving
             242      spouse, any minor and dependent children, and any pretermitted child of the decedent as described
             243      elsewhere in this code.
             244          (3) Except as to proceedings which do not survive the death of the decedent, a personal


             245      representative of a decedent domiciled in this state at his death has the same standing to sue and
             246      be sued in the courts of this state and courts of any other jurisdiction as his decedent had
             247      immediately prior to death.
             248          Section 6. Section 75-3-913 is amended to read:
             249           75-3-913. Distributions to trustee.
             250          (1) Before distributing to a trustee, the personal representative may require that the trust
             251      be registered if the state in which it is to be administered provides for registration and that the
             252      trustee inform the beneficiaries as provided in Section [ 75-7-303 ] 75-7-813 .
             253          (2) If the trust instrument does not excuse the trustee from giving bond, the personal
             254      representative may petition the appropriate court to require that the trustee post bond if he
             255      apprehends that distribution might jeopardize the interests of persons who are not able to protect
             256      themselves; and he may withhold distribution until the court has acted.
             257          (3) No inference of negligence on the part of the personal representative shall be drawn
             258      from his failure to exercise the authority conferred by Subsections (1) and (2).
             259          Section 7. Section 75-5-417 is amended to read:
             260           75-5-417. General duty of conservator.
             261          (1) A conservator shall act as a fiduciary and shall observe the standards of care as set forth
             262      in Section [ 75-7-302 ] 75-7-902 .
             263          (2) The conservator shall, for all estates in excess of $50,000, excluding the residence
             264      owned by the ward, send a report with a full accounting to the court on an annual basis. For estates
             265      less than $50,000, excluding the residence owned by the ward, the conservator shall fill out an
             266      informal annual report and mail the report to the court. The report shall include the following: a
             267      statement of assets at the beginning and end of the reporting year, income received during the year,
             268      disbursements for the support of the ward, and other expenses incurred by the estate. The court
             269      may require additional information. The forms for both the informal report for estates under
             270      $50,000, excluding the residence owned by the ward, and the full accounting report for larger
             271      estates shall be approved by the judicial council. This annual report shall be examined and
             272      approved by the court.
             273          (3) Corporate fiduciaries are not required to fully petition the court, but shall submit their
             274      internal report annually to the court. The report shall be examined and approved by the court.
             275          (4) If a conservator or corporate fiduciary:


             276          (a) makes a substantial misstatement on filings of any required annual reports;
             277          (b) is guilty of gross impropriety in handling the property of the ward; or
             278          (c) willfully fails to file the report required by this section, after receiving written notice
             279      of the failure to file and after a grace period of two months have elapsed; then the court may
             280      impose a fine in an amount not to exceed $5,000. The court may also order restitution of funds
             281      misappropriated from the estate of a ward. The penalty shall be paid by the conservator or
             282      corporate fiduciary and may not be paid by the estate.
             283          (5) These provisions and penalties governing annual reports do not apply if the conservator
             284      is the parent of the ward.
             285          Section 8. Section 75-7-101 is repealed and reenacted to read:
             286     
CHAPTER 7. UTAH UNIFORM TRUST CODE

             287     
Part 1. General Provisions

             288          75-7-101. Title.
             289          This chapter is known as the "Utah Uniform Trust Code."
             290          Section 9. Section 75-7-102 is enacted to read:
             291          75-7-102. Scope.
             292          This chapter applies to express trusts, charitable or noncharitable, and trusts created
             293      pursuant to a statute, judgment, or decree that requires the trust to be administered in the manner
             294      of an express trust.
             295          Section 10. Section 75-7-103 is enacted to read:
             296          75-7-103. Definitions.
             297          In this chapter:
             298          (1) "Action," with respect to an act of a trustee, includes a failure to act.
             299          (2) "Beneficiary" means a person that:
             300          (a) has a present or future beneficial interest in a trust, vested or contingent; or
             301          (b) in a capacity other than that of trustee, holds a power of appointment over trust
             302      property.
             303          (3) "Charitable trust" means a trust, or portion of a trust, created for a charitable purpose
             304      described in Subsection 75-7-405 (1).
             305          (4) "Conservator" means a person appointed by the court to administer the estate of a
             306      minor or adult individual.


             307          (5) "Environmental law" means a federal, state, or local law, rule, regulation, or ordinance
             308      relating to protection of the environment.
             309          (6) "Guardian" means a person appointed by the court, a parent, or a spouse, to make
             310      decisions regarding the support, care, education, health, and welfare of a minor or adult individual.
             311      The term does not include a guardian ad litem.
             312          (7) "Interests of the beneficiaries" means the beneficial interests provided in the terms of
             313      the trust.
             314          (8) "Jurisdiction," with respect to a geographic area, includes a state or country.
             315          (9) "Person" means an individual, corporation, business trust, estate, trust, partnership,
             316      limited liability company, association, joint venture, government, governmental subdivision,
             317      governmental agency or instrumentality, public corporation, or any other legal or commercial
             318      entity.
             319          (10) "Power of withdrawal" means a presently exercisable general power of appointment
             320      other than a power exercisable only upon consent of the trustee or a person holding an adverse
             321      interest.
             322          (11) "Property" means anything that may be the subject of ownership, whether real or
             323      personal, legal or equitable, or any interest therein.
             324          (12) "Qualified beneficiary" means a beneficiary who, on the date the beneficiary's
             325      qualification is determined:
             326          (a) is a distributee or permissible distributee of trust income or principal;
             327          (b) would be a distributee or permissible distributee of trust income or principal if the
             328      interests of the distributees described in Subsection (12)(a) terminated on that date; or
             329          (c) would be a distributee or permissible distributee of trust income or principal if the trust
             330      terminated on that date.
             331          (13) "Revocable," as applied to a trust, means revocable by the settlor without the consent
             332      of the trustee or a person holding an adverse interest.
             333          (14) "Settlor" means a person, including a testator, who creates, or contributes property
             334      to, a trust. If more than one person creates or contributes property to a trust, each person is a
             335      settlor of the portion of the trust property attributable to that person's contribution except to the
             336      extent another person has the power to revoke or withdraw that portion.
             337          (15) "Spendthrift provision" means a term of a trust which restrains both voluntary and


             338      involuntary transfer of a beneficiary's interest.
             339          (16) "State" means a state of the United States, the District of Columbia, Puerto Rico, the
             340      United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the
             341      United States. The term includes an Indian tribe or band recognized by federal law or formally
             342      acknowledged by a state.
             343          (17) "Terms of a trust" means the manifestation of the settlor's intent regarding a trust's
             344      provisions as expressed in the trust instrument or as may be established by other evidence that
             345      would be admissible in a judicial proceeding.
             346          (18) "Trust instrument" means an instrument executed by the settlor that contains terms
             347      of the trust, including any amendments.
             348          (19) "Trustee" includes an original, additional, and successor trustee, and a cotrustee.
             349          Section 11. Section 75-7-104 is enacted to read:
             350          75-7-104. Knowledge.
             351          (1) Subject to Subsection (2), a person has knowledge of a fact if the person:
             352          (a) has actual knowledge of it;
             353          (b) has received a notice or notification of it; or
             354          (c) from all the facts and circumstances known to the person at the time in question, has
             355      reason to know it.
             356          (2) An organization that conducts activities through employees has notice or knowledge
             357      of a fact involving a trust only from the time the information was received by an employee having
             358      responsibility to act for the trust, or would have been brought to the employee's attention if the
             359      organization had exercised reasonable diligence. An organization exercises reasonable diligence
             360      if it maintains reasonable routines for communicating significant information to the employee
             361      having responsibility to act for the trust and there is reasonable compliance with the routines.
             362      Reasonable diligence does not require an employee of the organization to communicate
             363      information unless the communication is part of the individual's regular duties or the individual
             364      knows a matter involving the trust would be materially affected by the information.
             365          Section 12. Section 75-7-105 is enacted to read:
             366          75-7-105. Default and mandatory rules.
             367          (1) Except as otherwise provided in the terms of the trust, this chapter governs the duties
             368      and powers of a trustee, relations among trustees, and the rights and interests of a beneficiary.


             369          (2) The terms of a trust prevail over any provision of this chapter except:
             370          (a) the requirements for creating a trust;
             371          (b) the duty of a trustee to act in good faith and in accordance with the purposes of the
             372      trust;
             373          (c) the requirement that a trust and its terms be for the benefit of its beneficiaries;
             374          (d) the power of the court to modify or terminate a trust under Sections 75-7-410 through
             375      75-7-416 ;
             376          (e) the effect of a spendthrift provision and the rights of certain creditors and assignees to
             377      reach a trust as provided in Part 5, Creditor's Claims - Spendthrift and Discretionary Trusts;
             378          (f) the power of the court under Section 75-7-702 to require, dispense with, or modify or
             379      terminate a bond;
             380          (g) the power of the court under Subsection 75-7-708 (2) to adjust a trustee's compensation
             381      specified in the terms of the trust which is unreasonably low or high;
             382          (h) the duty to notify the qualified beneficiaries of an irrevocable trust who have attained
             383      25 years of age of the existence of the trust and of their right to request trustee's reports and other
             384      information reasonably related to the administration of the trust;
             385          (i) the duty to respond to the request of a beneficiary of an irrevocable trust for trustee's
             386      reports and other information reasonably related to the administration of a trust;
             387          (j) the effect of an exculpatory term under Section 75-7-1008 ;
             388          (k) the rights under Sections 75-7-1010 through 75-7-1013 of a person other than a trustee
             389      or beneficiary;
             390          (l) periods of limitation for commencing a judicial proceeding;
             391          (m) the power of the court to take action and exercise jurisdiction that may be necessary
             392      in the interests of justice; and
             393          (n) the subject matter jurisdiction of the court and venue for commencing a proceeding as
             394      provided in Sections 75-7-203 and 75-7-204 .
             395          Section 13. Section 75-7-106 is enacted to read:
             396          75-7-106. Common law of trusts -- Principles of equity.
             397          The common law of trusts and principles of equity supplement this chapter, except to the
             398      extent modified by this chapter or other laws of this state.
             399          Section 14. Section 75-7-107 is enacted to read:


             400          75-7-107. Governing law.
             401          The meaning and effect of the terms of a trust are determined by:
             402          (1) the law of the jurisdiction designated in the terms unless the designation of that
             403      jurisdiction's law is contrary to a strong public policy of the jurisdiction having the most significant
             404      relationship to the matter at issue; or
             405          (2) in the absence of a controlling designation in the terms of the trust, the law of the
             406      jurisdiction having the most significant relationship to the matter at issue.
             407          Section 15. Section 75-7-108 is enacted to read:
             408          75-7-108. Principal place of administration.
             409          (1) Without precluding other means for establishing a sufficient connection with the
             410      designated jurisdiction, terms of a trust designating the principal place of administration are valid
             411      and controlling if:
             412          (a) a trustee's principal place of business is located in or a trustee is a resident of the
             413      designated jurisdiction; or
             414          (b) all or part of the administration occurs in the designated jurisdiction.
             415          (2) A trustee is under a continuing duty to administer the trust at a place appropriate to its
             416      purposes, its administration, and the interests of the beneficiaries.
             417          (3) Without precluding the right of the court to order, approve, or disapprove a transfer,
             418      the trustee, in furtherance of the duty prescribed by Subsection (2), may transfer the trust's
             419      principal place of administration to another state or to a jurisdiction outside of the United States.
             420          (4) The trustee shall notify the qualified beneficiaries of a proposed transfer of a trust's
             421      principal place of administration not less than 60 days before initiating the transfer. The notice of
             422      proposed transfer must include:
             423          (a) the name of the jurisdiction to which the principal place of administration is to be
             424      transferred;
             425          (b) the address and telephone number at the new location at which the trustee can be
             426      contacted;
             427          (c) an explanation of the reasons for the proposed transfer;
             428          (d) the date on which the proposed transfer is anticipated to occur; and
             429          (e) the date, not less than 60 days after the giving of the notice, by which the qualified
             430      beneficiary must notify the trustee of an objection to the proposed transfer.


             431          (5) The authority of a trustee under this section to transfer a trust's principal place of
             432      administration terminates if a qualified beneficiary notifies the trustee of an objection to the
             433      proposed transfer on or before the date specified in the notice.
             434          (6) In connection with a transfer of the trust's principal place of administration, the trustee
             435      may transfer some or all of the trust property to a successor trustee designated in the terms of the
             436      trust or appointed pursuant to Section 75-7-704 .
             437          Section 16. Section 75-7-109 is enacted to read:
             438          75-7-109. Methods and waiver of notice.
             439          (1) Notice to a person under this chapter or the sending of a document to a person under
             440      this chapter must be accomplished in a manner reasonably suitable under the circumstances and
             441      likely to result in receipt of the notice or document. Permissible methods of notice or for sending
             442      a document include first-class mail, personal delivery, delivery to the person's last known place
             443      of residence or place of business, or a properly directed electronic message.
             444          (2) Notice otherwise required under this chapter or a document otherwise required to be
             445      sent under this chapter need not be provided to a person whose identity or location is unknown to
             446      and not reasonably ascertainable by the trustee.
             447          (3) Notice under this chapter or the sending of a document under this chapter may be
             448      waived by the person to be notified or sent the document.
             449          (4) Notice of a judicial proceeding must be given as provided in the applicable rules of
             450      civil procedure.
             451          Section 17. Section 75-7-110 is enacted to read:
             452          75-7-110. Others treated as qualified beneficiaries.
             453          (1) Whenever notice to qualified beneficiaries of a trust is required under this chapter, the
             454      trustee must also give notice to any other beneficiary who has sent the trustee a request for notice.
             455          (2) A charitable organization expressly entitled to receive benefits under the terms of a
             456      charitable trust or a person appointed to enforce a trust created for the care of an animal or another
             457      noncharitable purpose as provided in Section 75-7-408 or 75-7-409 has the rights of a qualified
             458      beneficiary under this chapter.
             459          (3) The attorney general has the rights of a qualified beneficiary with respect to a charitable
             460      trust having its principal place of administration in this state.
             461          Section 18. Section 75-7-111 is enacted to read:


             462          75-7-111. Nonjudicial settlement agreements.
             463          (1) For purposes of this section, "interested persons" means persons whose consent would
             464      be required in order to achieve a binding settlement were the settlement to be approved by the
             465      court.
             466          (2) Except as otherwise provided in Subsection (3), interested persons may enter into a
             467      binding nonjudicial settlement agreement with respect to any matter involving a trust.
             468          (3) A nonjudicial settlement agreement is valid only to the extent it does not violate a
             469      material purpose of the trust and includes terms and conditions that could be properly approved
             470      by the court under this chapter or other applicable law.
             471          (4) Matters that may be resolved by a nonjudicial settlement agreement include:
             472          (a) the interpretation or construction of the terms of the trust;
             473          (b) the approval of a trustee's report or accounting;
             474          (c) direction to a trustee to refrain from performing a particular act or the grant to a trustee
             475      of any necessary or desirable power;
             476          (d) the resignation or appointment of a trustee and the determination of a trustee's
             477      compensation;
             478          (e) transfer of a trust's principal place of administration; and
             479          (f) liability of a trustee for an action relating to the trust.
             480          (5) Any interested person may request the court to approve a nonjudicial settlement
             481      agreement, to determine whether the representation as provided in Part 3, Representation, was
             482      adequate, and to determine whether the agreement contains terms and conditions the court could
             483      have properly approved.
             484          Section 19. Section 75-7-112 is enacted to read:
             485          75-7-112. Rules of construction.
             486          The rules of construction that apply to the interpretation of and disposition of property by
             487      will also apply as appropriate to the interpretation of the terms of a trust and the disposition of the
             488      trust property.
             489          Section 20. Section 75-7-201 is repealed and reenacted to read:
             490     
Part 2. Judicial Proceedings

             491          75-7-201. Role of court in administration of trust.
             492          (1) The court may intervene in the administration of a trust to the extent its jurisdiction is


             493      invoked by an interested person or as provided by law.
             494          (2) A trust is not subject to continuing judicial supervision unless ordered by the court.
             495          (3) A judicial proceeding involving a trust may relate to any matter involving the trust's
             496      administration, including a request for instructions and an action to declare rights.
             497          Section 21. Section 75-7-202 is repealed and reenacted to read:
             498          75-7-202. Jurisdiction over trustee and beneficiary.
             499          (1) By accepting the trusteeship of a trust having its principal place of administration in
             500      this state or by moving the principal place of administration to this state, the trustee submits
             501      personally to the jurisdiction of the courts of this state regarding any matter involving the trust.
             502          (2) With respect to their interests in the trust, the beneficiaries of a trust having its
             503      principal place of administration in this state are subject to the jurisdiction of the courts of this
             504      state regarding any matter involving the trust. By accepting a distribution from such a trust, the
             505      recipient submits personally to the jurisdiction of the courts of this state regarding any matter
             506      involving the trust.
             507          (3) This section does not preclude other methods of obtaining jurisdiction over a trustee,
             508      beneficiary, or other person receiving property from the trust.
             509          Section 22. Section 75-7-203 is repealed and reenacted to read:
             510          75-7-203. Subject matter jurisdiction.
             511          (1) The district court has exclusive jurisdiction of proceedings in this state brought by a
             512      trustee or beneficiary concerning the administration of a trust.
             513          (2) The district court has concurrent jurisdiction with other courts of this state of other
             514      proceedings involving a trust.
             515          Section 23. Section 75-7-204 is repealed and reenacted to read:
             516          75-7-204. Venue.
             517          (1) Except as otherwise provided in Subsection (2), venue for a judicial proceeding
             518      involving a trust is in the county in which the trust's principal place of administration is or will be
             519      located and, if the trust is created by will and the estate is not yet closed, in the county in which
             520      the decedent's estate is being administered.
             521          (2) If a trust has no trustee, venue for a judicial proceeding for the appointment of a trustee
             522      is in any county of this state in which a beneficiary resides, in any county in which any trust
             523      property is located, and if the trust is created by will, in the county in which the decedent's estate


             524      was or is being administered.
             525          Section 24. Section 75-7-301 is repealed and reenacted to read:
             526     
Part 3. Representation

             527          75-7-301. Basic effect.
             528          (1) Notice to a person who may represent and bind another person under this part has the
             529      same effect as if notice were given directly to the other person.
             530          (2) The consent of a person who may represent and bind another person under this part is
             531      binding on the person represented unless the person represented objects to the representation
             532      before the consent would otherwise have become effective.
             533          (3) Except as otherwise provided in Sections 75-7-411 and 75-7-602 , a person who under
             534      this part may represent a settlor who lacks capacity may receive notice and give a binding consent
             535      on the settlor's behalf.
             536          Section 25. Section 75-7-302 is repealed and reenacted to read:
             537          75-7-302. Representation by holder of general testamentary power of appointment.
             538          To the extent there is no conflict of interest between the holder of a general testamentary
             539      power of appointment and the persons represented with respect to the particular question or
             540      dispute, the holder may represent and bind persons whose interests, as permissible appointees,
             541      takers in default, or otherwise, are subject to the power.
             542          Section 26. Section 75-7-303 is repealed and reenacted to read:
             543          75-7-303. Representation by fiduciaries and parents.
             544          To the extent there is no conflict of interest between the representative and the person
             545      represented or among those being represented with respect to a particular question or dispute:
             546          (1) a conservator may represent and bind the estate that the conservator controls;
             547          (2) a guardian may represent and bind a ward if a conservator of the ward's estate has not
             548      been appointed;
             549          (3) an agent having authority to act with respect to the particular question or dispute may
             550      represent and bind the principal;
             551          (4) a trustee may represent and bind the beneficiaries of the trust;
             552          (5) a personal representative of a decedent's estate may represent and bind persons
             553      interested in the estate; and
             554          (6) a parent may represent and bind the parent's minor or unborn child if a conservator or


             555      guardian for the child has not been appointed.
             556          Section 27. Section 75-7-304 is repealed and reenacted to read:
             557          75-7-304. Representation by person having substantially identical interest.
             558          Unless otherwise represented, a minor, incapacitated, or unborn individual, or a person
             559      whose identity or location is unknown and not reasonably ascertainable, may be represented by and
             560      bound by another having a substantially identical interest with respect to the particular question
             561      or dispute, but only to the extent there is no conflict of interest between the representative and the
             562      person represented.
             563          Section 28. Section 75-7-305 is repealed and reenacted to read:
             564          75-7-305. Appointment of representative.
             565          (1) If the court determines that an interest is not represented under this part, or that the
             566      otherwise available representation might be inadequate, the court may appoint a representative to
             567      receive notice, give consent, and otherwise represent, bind, and act on behalf of a minor,
             568      incapacitated, or unborn individual, or a person whose identity or location is unknown. A
             569      representative may be appointed to represent several persons or interests.
             570          (2) A representative may act on behalf of the individual represented with respect to any
             571      matter arising under this chapter, whether or not a judicial proceeding concerning the trust is
             572      pending.
             573          (3) In making decisions, a representative may consider general benefit accruing to the
             574      living members of the individual's family.
             575          Section 29. Section 75-7-401 is repealed and reenacted to read:
             576     
Part 4. Creation, Validity, Modification, and Termination

             577          75-7-401. Methods of creating trust.
             578          A trust may be created by:
             579          (1) transfer of property to another person as trustee during the settlor's lifetime or by will
             580      or other disposition taking effect upon the settlor's death;
             581          (2) declaration by the owner of property that the owner holds identifiable property as
             582      trustee; or
             583          (3) exercise of a power of appointment in favor of a trustee.
             584          Section 30. Section 75-7-402 is repealed and reenacted to read:
             585          75-7-402. Requirements for creation.


             586          (1) A trust is created only if:
             587          (a) the settlor has capacity to create a trust;
             588          (b) the settlor indicates an intention to create the trust;
             589          (c) the trust has a definite beneficiary or is:
             590          (i) a charitable trust;
             591          (ii) a trust for the care of an animal, as provided in Section 75-7-408 ; or
             592          (iii) a trust for a noncharitable purpose, as provided in Section 75-7-409 ;
             593          (d) the trustee has duties to perform; and
             594          (e) the same person is not the sole trustee and sole beneficiary.
             595          (2) A beneficiary is definite if the beneficiary can be ascertained now or in the future,
             596      subject to any applicable rule against perpetuities.
             597          (3) A power in a trustee to select a beneficiary from an indefinite class is valid. If the
             598      power is not exercised within a reasonable time, the power fails and the property subject to the
             599      power passes to the persons who would have taken the property had the power not been conferred.
             600          Section 31. Section 75-7-403 is repealed and reenacted to read:
             601          75-7-403. Trusts created in other jurisdictions.
             602          A trust not created by will is validly created if its creation complies with the law of the
             603      jurisdiction in which the trust instrument was executed, or the law of the jurisdiction in which, at
             604      the time of creation:
             605          (1) the settlor was domiciled, had a place of abode, or was a national;
             606          (2) a trustee was domiciled or had a place of business; or
             607          (3) any trust property was located.
             608          Section 32. Section 75-7-404 is repealed and reenacted to read:
             609          75-7-404. Trust purposes.
             610          A trust may be created only to the extent its purposes are lawful, not contrary to public
             611      policy, and possible to achieve. A trust and its terms must be for the benefit of its beneficiaries.
             612          Section 33. Section 75-7-405 is repealed and reenacted to read:
             613          75-7-405. Charitable purposes -- Enforcement.
             614          (1) A charitable trust may be created for the relief of poverty, the advancement of
             615      education or religion, the promotion of health, governmental or municipal purposes, or other
             616      purposes the achievement of which is beneficial to the community.


             617          (2) If the terms of a charitable trust do not indicate a particular charitable purpose or
             618      beneficiary, the court may select one or more charitable purposes or beneficiaries. The selection
             619      must be consistent with the settlor's intention to the extent it can be ascertained.
             620          (3) The settlor of a charitable trust, among others, may maintain a proceeding to enforce
             621      the trust.
             622          Section 34. Section 75-7-406 is repealed and reenacted to read:
             623          75-7-406. Creation of trust induced by fraud, duress, or undue influence.
             624          A trust is void to the extent its creation was induced by fraud, duress, or undue influence.
             625          Section 35. Section 75-7-407 is repealed and reenacted to read:
             626          75-7-407. Evidence of oral trust.
             627          Except as required by a statute other than this chapter, a trust need not be evidenced by a
             628      trust instrument, but the creation of an oral trust and its terms may be established only by clear and
             629      convincing evidence.
             630          Section 36. Section 75-7-408 is repealed and reenacted to read:
             631          75-7-408. Trust for care of animal.
             632          (1) A trust may be created to provide for the care of an animal alive during the settlor's
             633      lifetime. The trust terminates upon the death of the animal or, if the trust was created to provide
             634      for the care of more than one animal alive during the settlor's lifetime, upon the death of the last
             635      surviving animal.
             636          (2) A trust authorized by this section may be enforced by a person appointed in the terms
             637      of the trust or, if no person is so appointed, by a person appointed by the court. A person having
             638      an interest in the welfare of the animal may request the court to appoint a person to enforce the
             639      trust or to remove a person appointed.
             640          (3) Property of a trust authorized by this section may be applied only to its intended use,
             641      except to the extent the court determines that the value of the trust property exceeds the amount
             642      required for the intended use. Except as otherwise provided in the terms of the trust, property not
             643      required for the intended use must be distributed to the settlor, if then living, otherwise to the
             644      settlor's successors in interest.
             645          Section 37. Section 75-7-409 is repealed and reenacted to read:
             646          75-7-409. Noncharitable trust without ascertainable beneficiary.
             647          Except as otherwise provided in Section 76-7-408 or by another statute, the following rules


             648      apply:
             649          (1) A trust may be created for a noncharitable purpose without a definite or definitely
             650      ascertainable beneficiary or for a noncharitable but otherwise valid purpose to be selected by the
             651      trustee. The trust may not be enforced for more than 21 years.
             652          (2) A trust authorized by this section may be enforced by a person appointed in the terms
             653      of the trust or, if no person is so appointed, by a person appointed by the court.
             654          (3) Property of a trust authorized by this section may be applied only to its intended use,
             655      except to the extent the court determines that the value of the trust property exceeds the amount
             656      required for the intended use. Except as otherwise provided in the terms of the trust, property not
             657      required for the intended use must be distributed to the settlor, if then living, otherwise to the
             658      settlor's successors in interest.
             659          Section 38. Section 75-7-410 is repealed and reenacted to read:
             660          75-7-410. Modification or termination of trust -- Proceedings for approval or
             661      disapproval.
             662          (1) In addition to the methods of termination prescribed by Sections 75-7-411 through
             663      75-7-414 , a trust terminates to the extent the trust is revoked or expires pursuant to its terms, no
             664      purpose of the trust remains to be achieved, or the purposes of the trust have become unlawful,
             665      contrary to public policy, or impossible to achieve.
             666          (2) A proceeding to approve or disapprove a proposed modification or termination under
             667      Sections 75-7-411 through 75-7-416 , or trust combination or division under Section 75-7-417 , may
             668      be commenced by a trustee or beneficiary, and a proceeding to approve or disapprove a proposed
             669      modification or termination under Section 75-7-411 may be commenced by the settlor. The settlor
             670      of a charitable trust may maintain a proceeding to modify the trust under Section 75-7-413 .
             671          Section 39. Section 75-7-411 is repealed and reenacted to read:
             672          75-7-411. Modification or termination of noncharitable irrevocable trust by consent.
             673          (1) A noncharitable irrevocable trust may be modified or terminated upon consent of the
             674      settlor and all beneficiaries, even if the modification or termination is inconsistent with a material
             675      purpose of the trust. A settlor's power to consent to a trust's termination may be exercised by an
             676      agent under a power of attorney only to the extent expressly authorized by the power of attorney
             677      or the terms of the trust; by the settlor's conservator with the approval of the court supervising the
             678      conservatorship if an agent is not so authorized; or by the settlor's guardian with the approval of


             679      the court supervising the guardianship if an agent is not so authorized and a conservator has not
             680      been appointed.
             681          (2) A noncharitable irrevocable trust may be terminated upon consent of all of the
             682      beneficiaries if the court concludes that continuance of the trust is not necessary to achieve any
             683      material purpose of the trust. A noncharitable irrevocable trust may be modified upon consent of
             684      all of the beneficiaries if the court concludes that modification is not inconsistent with a material
             685      purpose of the trust.
             686          (3) A spendthrift provision in the terms of the trust is not presumed to constitute a material
             687      purpose of the trust.
             688          (4) Upon termination of a trust under Subsection (1) or (2), the trustee shall distribute the
             689      trust property as agreed by the beneficiaries.
             690          (5) If not all of the beneficiaries consent to a proposed modification or termination of the
             691      trust under Subsection (1) or (2), the modification or termination may be approved by the court if
             692      the court is satisfied that:
             693          (a) if all of the beneficiaries had consented, the trust could have been modified or
             694      terminated under this section; and
             695          (b) the interests of a beneficiary who does not consent will be adequately protected.
             696          Section 40. Section 75-7-412 is enacted to read:
             697          75-7-412. Modification or termination because of unanticipated circumstances or
             698      inability to administer trust effectively.
             699          (1) The court may modify the administrative or dispositive terms of a trust or terminate
             700      the trust if, because of circumstances not anticipated by the settlor, modification or termination will
             701      further the purposes of the trust. To the extent practicable, the modification must be made in
             702      accordance with the settlor's probable intention.
             703          (2) The court may modify the administrative terms of a trust if continuation of the trust on
             704      its existing terms would be impracticable or wasteful or impair the trust's administration.
             705          (3) Upon termination of a trust under this section, the trustee shall distribute the trust
             706      property in a manner consistent with the purposes of the trust.
             707          Section 41. Section 75-7-413 is enacted to read:
             708          75-7-413. Cy pres.
             709          (1) Except as otherwise provided in Subsection (2), if a particular charitable purpose


             710      becomes unlawful, impracticable, impossible to achieve, or wasteful:
             711          (a) the trust does not fail, in whole or in part;
             712          (b) the trust property does not revert to the settlor or the settlor's successors in interest; and
             713          (c) the court may apply cy pres to modify or terminate the trust by directing that the trust
             714      property be applied or distributed, in whole or in part, in a manner consistent with the settlor's
             715      charitable purposes.
             716          (2) A provision in the terms of a charitable trust that would result in distribution of the
             717      trust property to a noncharitable beneficiary prevails over the power of the court under Subsection
             718      (1) to apply cy pres to modify or terminate the trust only if, when the provision takes effect:
             719          (a) the trust property is to revert to the settlor and the settlor is still living; or
             720          (b) fewer than 21 years have elapsed since the date of the trust's creation.
             721          Section 42. Section 75-7-414 is enacted to read:
             722          75-7-414. Modification of termination of uneconomic trust.
             723          (1) After notice to the qualified beneficiaries, the trustee of a trust consisting of trust
             724      property having a total value less than $50,000 may terminate the trust if the trustee concludes that
             725      the value of the trust property is insufficient to justify the cost of administration.
             726          (2) The court may modify or terminate a trust or remove the trustee and appoint a different
             727      trustee if it determines that the value of the trust property is insufficient to justify the cost of
             728      administration.
             729          (3) Upon termination of a trust under this section, the trustee shall distribute the trust
             730      property in a manner consistent with the purposes of the trust.
             731          (4) This section does not apply to an easement for conservation or preservation.
             732          Section 43. Section 75-7-415 is enacted to read:
             733          75-7-415. Reformation to correct mistakes.
             734          The court may reform the terms of a trust, even if unambiguous, to conform the terms to
             735      the settlor's intention if it is proved by clear and convincing evidence that both the settlor's intent
             736      and the terms of the trust were affected by a mistake of fact or law, whether in expression or
             737      inducement.
             738          Section 44. Section 75-7-416 is enacted to read:
             739          75-7-416. Modification to achieve settlor's tax objectives.
             740          To achieve the settlor's tax objectives, the court may modify the terms of a trust in a


             741      manner that is not contrary to the settlor's probable intention. The court may provide that the
             742      modification has retroactive effect.
             743          Section 45. Section 75-7-417 is enacted to read:
             744          75-7-417. Combination and division of trusts.
             745          After notice to the qualified beneficiaries, a trustee may combine two or more trusts into
             746      a single trust or divide a trust into two or more separate trusts, if the result does not impair rights
             747      of any beneficiary or adversely affect achievement of the purposes of the trust.
             748          Section 46. Section 75-7-501 is repealed and reenacted to read:
             749     
Part 5. Creditor's Claims - Spendthrift and Discretionary Trusts

             750          75-7-501. Rights of beneficiary's creditor or assignee.
             751          To the extent a beneficiary's interest is not protected by a spendthrift provision, the court
             752      may authorize a creditor or assignee of the beneficiary to reach the beneficiary's interest by
             753      attachment of present or future distributions to or for the benefit of the beneficiary or other means.
             754      The court may limit the award to relief as is appropriate under the circumstances.
             755          Section 47. Section 75-7-502 is enacted to read:
             756          75-7-502. Spendthrift provision.
             757          (1) A spendthrift provision is valid only if it restrains both voluntary and involuntary
             758      transfer of a beneficiary's interest.
             759          (2) A term of a trust providing that the interest of a beneficiary is held subject to a
             760      "spendthrift trust," or words of similar import, is sufficient to restrain both voluntary and
             761      involuntary transfer of the beneficiary's interest.
             762          (3) A beneficiary may not transfer an interest in a trust in violation of a valid spendthrift
             763      provision and, except as otherwise provided in this part, a creditor or assignee of the beneficiary
             764      may not reach the interest or a distribution by the trustee before its receipt by the beneficiary.
             765          Section 48. Section 75-7-503 is enacted to read:
             766          75-7-503. Exceptions to spendthrift provision.
             767          (1) In this section, "child" includes any person for whom an order or judgment for child
             768      support has been entered in this or another state.
             769          (2) Even if a trust contains a spendthrift provision, a beneficiary's child, spouse, or former
             770      spouse who has a judgment or court order against the beneficiary for support or maintenance, or
             771      a judgment creditor who has provided services for the protection of a beneficiary's interest in the


             772      trust, may obtain from a court an order attaching present or future distributions to or for the benefit
             773      of the beneficiary.
             774          (3) A spendthrift provision is unenforceable against a claim of this state or the United
             775      States to the extent a statute of this state or federal law so provides.
             776          Section 49. Section 75-7-504 is enacted to read:
             777          75-7-504. Discretionary trusts -- Effect of standard.
             778          (1) In this section, "child" includes any person for whom an order or judgment for child
             779      support has been entered in this or another state.
             780          (2) Except as otherwise provided in Subsection (3), whether or not a trust contains a
             781      spendthrift provision, a creditor of a beneficiary may not compel a distribution that is subject to
             782      the trustee's discretion, even if:
             783          (a) the discretion is expressed in the form of a standard of distribution; or
             784          (b) the trustee has abused the discretion.
             785          (3) To the extent a trustee has not complied with a standard of distribution or has abused
             786      a discretion:
             787          (a) a distribution may be ordered by the court to satisfy a judgment or court order against
             788      the beneficiary for support or maintenance of the beneficiary's child, spouse, or former spouse; and
             789          (b) the court shall direct the trustee to pay to the child, spouse, or former spouse such
             790      amount as is equitable under the circumstances but not more than the amount the trustee would
             791      have been required to distribute to or for the benefit of the beneficiary had the trustee complied
             792      with the standard or not abused the discretion.
             793          (4) This section does not limit the right of a beneficiary to maintain a judicial proceeding
             794      against a trustee for an abuse of discretion or failure to comply with a standard for distribution.
             795          Section 50. Section 75-7-505 is enacted to read:
             796          75-7-505. Creditor's claim against settlor.
             797          (1) Whether or not the terms of a trust contain a spendthrift provision, the following rules
             798      apply:
             799          (a) During the lifetime of the settlor, the property of a revocable trust is subject to claims
             800      of the settlor's creditors.
             801          (b) With respect to an irrevocable trust, a creditor or assignee of the settlor may reach the
             802      maximum amount that can be distributed to or for the settlor's benefit. If a trust has more than one


             803      settlor, the amount the creditor or assignee of a particular settlor may reach may not exceed the
             804      settlor's interest in the portion of the trust attributable to that settlor's contribution.
             805          (c) After the death of a settlor, and subject to the settlor's right to direct the source from
             806      which liabilities will be paid, the property of a trust that was revocable at the settlor's death is
             807      subject to claims of the settlor's creditors, costs of administration of the settlor's estate, the
             808      expenses of the settlor's funeral and disposal of remains, and statutory allowances to a surviving
             809      spouse and children to the extent the settlor's probate estate is inadequate to satisfy those claims,
             810      costs, expenses, and allowances.
             811          (2) For purposes of this section:
             812          (a) during the period the power may be exercised, the holder of a power of withdrawal is
             813      treated in the same manner as the settlor of a revocable trust to the extent of the property subject
             814      to the power; and
             815          (b) upon the lapse, release, or waiver of the power, the holder is treated as the settlor of
             816      the trust only to the extent the value of the property affected by the lapse, release, or waiver
             817      exceeds the greater of the amount specified in Section 2041(b)(2) or 2514(e) of the Internal
             818      Revenue Code of 1986, or Section 2503(b) of the Internal Revenue Code of 1986, in each case as
             819      in effect on May 1, 2002.
             820          Section 51. Section 75-7-506 is enacted to read:
             821          75-7-506. Overdue distribution.
             822          Whether or not a trust contains a spendthrift provision, a creditor or assignee of a
             823      beneficiary may reach a mandatory distribution of income or principal, including a distribution
             824      upon termination of the trust, if the trustee has not made the distribution to the beneficiary within
             825      a reasonable time after the required distribution date.
             826          Section 52. Section 75-7-507 is enacted to read:
             827          75-7-507. Personal obligations of trustee.
             828          Trust property is not subject to personal obligations of the trustee, even if the trustee
             829      becomes insolvent or bankrupt.
             830          Section 53. Section 75-7-601 is enacted to read:
             831     
Part 6. Revocable Trusts

             832          75-7-601. Capacity of settlor of revocable trust.
             833          The capacity required to create, amend, revoke, or add property to a revocable trust, or to


             834      direct the actions of the trustee of a revocable trust, is the same as that required to make a will.
             835          Section 54. Section 75-7-602 is enacted to read:
             836          75-7-602. Revocation or amendment of revocable trust.
             837          (1) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor
             838      may revoke or amend the trust. This Subsection (1) does not apply to a trust created under an
             839      instrument executed before May 1, 2002.
             840          (2) If a revocable trust is created or funded by more than one settlor:
             841          (a) to the extent the trust consists of community property, the trust may be revoked by
             842      either spouse acting alone but may be amended only by joint action of both spouses; and
             843          (b) to the extent the trust consists of property other than community property, each settlor
             844      may revoke or amend the trust with regard the portion of the trust property attributable to that
             845      settlor's contribution.
             846          (3) The settlor may revoke or amend a revocable trust:
             847          (a) by substantially complying with a method provided in the terms of the trust; or
             848          (b) if the terms of the trust do not provide a method or the method provided in the terms
             849      is not expressly made exclusive, by:
             850          (i) executing a later will or codicil that expressly refers to the trust or specifically devises
             851      property that would otherwise have passed according to the terms of the trust; or
             852          (ii) any other method manifesting clear and convincing evidence of the settlor's intent.
             853          (4) Upon revocation of a revocable trust, the trustee shall deliver the trust property as the
             854      settlor directs.
             855          (5) A settlor's powers with respect to revocation, amendment, or distribution of trust
             856      property may be exercised by an agent under a power of attorney only to the extent expressly
             857      authorized by the terms of the trust or the power.
             858          (6) A conservator of the settlor or, if no conservator has been appointed, a guardian of the
             859      settlor may exercise a settlor's powers with respect to revocation, amendment, or distribution of
             860      trust property only with the approval of the court supervising the conservatorship or guardianship.
             861          (7) A trustee who does not know that a trust has been revoked or amended is not liable to
             862      the settlor or settlor's successors in interest for distributions made and other actions taken on the
             863      assumption that the trust had not been amended or revoked.
             864          Section 55. Section 75-7-603 is enacted to read:


             865          75-7-603. Settlor's powers -- Powers of withdrawal.
             866          (1) While a trust is revocable and the settlor has capacity to revoke the trust, rights of the
             867      beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the
             868      settlor.
             869          (2) While a trust is revocable and the settlor does not have capacity to revoke the trust,
             870      rights of the beneficiaries are held by the beneficiaries.
             871          (3) If a revocable trust has more than one settlor, the duties of the trustee are owed to all
             872      of the settlors having capacity to revoke the trust.
             873          (4) During the period the power may be exercised, the holder of a power of withdrawal has
             874      the rights of a settlor of a revocable trust under this section to the extent of the property subject to
             875      the power.
             876          Section 56. Section 75-7-604 is enacted to read:
             877          75-7-604. Limitation on action contesting validity of revocable trust -- Distribution
             878      of trust property.
             879          (1) A person may commence a judicial proceeding to contest the validity of a trust that was
             880      revocable at the settlor's death within the earlier of:
             881          (a) three years after the settlor's death; or
             882          (b) 120 days after the trustee sent the person a copy of the trust instrument and a notice
             883      informing the person of the trust's existence, of the trustee's name and address, and of the time
             884      allowed for commencing a proceeding.
             885          (2) Upon the death of the settlor of a trust that was revocable at the settlor's death, the
             886      trustee may proceed to distribute the trust property in accordance with the terms of the trust. The
             887      trustee is not subject to liability for doing so unless:
             888          (a) the trustee knows of a pending judicial proceeding contesting the validity of the trust;
             889      or
             890          (b) a potential contestant has notified the trustee of a possible judicial proceeding to
             891      contest the trust and a judicial proceeding is commenced within 60 days after the contestant sent
             892      the notification.
             893          (3) A beneficiary of a trust that is determined to have been invalid is liable to return any
             894      distribution received.
             895          Section 57. Section 75-7-701 is enacted to read:


             896     
Part 7. Office of Trustee

             897          75-7-701. Accepting or declining trusteeship.
             898          (1) Except as otherwise provided in Subsection (3), a person designated as trustee accepts
             899      the trusteeship:
             900          (a) by substantially complying with a method of acceptance provided in the terms of the
             901      trust; or
             902          (b) if the terms of the trust do not provide a method or the method provided in the terms
             903      is not expressly made exclusive, by accepting delivery of the trust property, exercising powers or
             904      performing duties as trustee, or otherwise indicating acceptance of the trusteeship.
             905          (2) A person designated as trustee who has not yet accepted the trusteeship may reject the
             906      trusteeship. A designated trustee who does not accept the trusteeship within a reasonable time
             907      after knowing of the designation is considered to have rejected the trusteeship.
             908          (3) A person designated as trustee, without accepting the trusteeship, may:
             909          (a) act to preserve the trust property if, within a reasonable time after acting, the person
             910      sends a rejection of the trusteeship to the settlor or, if the settlor is dead or lacks capacity, to a
             911      qualified beneficiary; and
             912          (b) inspect or investigate trust property to determine potential liability under environmental
             913      or other law or for any other purpose.
             914          Section 58. Section 75-7-702 is enacted to read:
             915          75-7-702. Trustee's bond.
             916          (1) A trustee shall give bond to secure performance of the trustee's duties only if the court
             917      finds that a bond is needed to protect the interests of the beneficiaries or is required by the terms
             918      of the trust and the court has not dispensed with the requirement.
             919          (2) The court may specify the amount of a bond, its liabilities, and whether sureties are
             920      necessary. The court may modify or terminate a bond at any time.
             921          (3) A regulated financial service institution qualified to do trust business in this state need
             922      not give bond, even if required by the terms of the trust.
             923          Section 59. Section 75-7-703 is enacted to read:
             924          75-7-703. Cotrustees.
             925          (1) Cotrustees who are unable to reach a unanimous decision may act by majority decision.
             926          (2) If a vacancy occurs in a cotrusteeship, the remaining cotrustees may act for the trust.


             927          (3) A cotrustee must participate in the performance of a trustee's function unless the
             928      cotrustee is unavailable to perform the function because of absence, illness, disqualification under
             929      other law, or other temporary incapacity or the cotrustee has properly delegated the performance
             930      of the function to another trustee.
             931          (4) If a cotrustee is unavailable to perform duties because of absence, illness,
             932      disqualification under other law, or other temporary incapacity, and prompt action is necessary to
             933      achieve the purposes of the trust or to avoid injury to the trust property, the remaining cotrustee
             934      or a majority of the remaining cotrustees may act for the trust.
             935          (5) A trustee may not delegate to a cotrustee the performance of a function the settlor
             936      reasonably expected the trustees to perform jointly. Unless a delegation was irrevocable, a trustee
             937      may revoke a delegation previously made.
             938          (6) Except as otherwise provided in Subsection (7), a trustee who does not join in an action
             939      of another trustee is not liable for the action.
             940          (7) Each trustee shall exercise reasonable care to:
             941          (a) prevent a cotrustee from committing a serious breach of trust; and
             942          (b) compel a cotrustee to redress a serious breach of trust.
             943          (8) A dissenting trustee who joins in an action at the direction of the majority of the
             944      trustees and who notified any cotrustee of the dissent at or before the time of the action is not liable
             945      for the action unless the action is a serious breach of trust.
             946          Section 60. Section 75-7-704 is enacted to read:
             947          75-7-704. Vacancy in trusteeship -- Appointment of successor.
             948          (1) A vacancy in a trusteeship occurs if:
             949          (a) a person designated as trustee rejects the trusteeship;
             950          (b) a person designated as trustee cannot be identified or does not exist;
             951          (c) a trustee resigns;
             952          (d) a trustee is disqualified or removed;
             953          (e) a trustee dies; or
             954          (f) a guardian or conservator is appointed for an individual serving as trustee.
             955          (2) If one or more cotrustees remain in office, a vacancy in a trusteeship need not be filled.
             956      A vacancy in a trusteeship must be filled if the trust has no remaining trustee.
             957          (3) A vacancy in a trusteeship required to be filled must be filled in the following order


             958      of priority:
             959          (a) by a person designated in the terms of the trust to act as successor trustee;
             960          (b) by a person appointed by unanimous agreement of the qualified beneficiaries; or
             961          (c) by a person appointed by the court.
             962          (4) Whether or not a vacancy in a trusteeship exists or is required to be filled, the court
             963      may appoint an additional trustee or special fiduciary whenever the court considers the
             964      appointment necessary for the administration of the trust.
             965          Section 61. Section 75-7-705 is enacted to read:
             966          75-7-705. Resignation of trustee.
             967          (1) A trustee may resign:
             968          (a) upon at least 30 days' notice to the qualified beneficiaries and all cotrustees; or
             969          (b) with the approval of the court.
             970          (2) In approving a resignation, the court may issue orders and impose conditions
             971      reasonably necessary for the protection of the trust property.
             972          (3) Any liability of a resigning trustee or of any sureties on the trustee's bond for acts or
             973      omissions of the trustee is not discharged or affected by the trustee's resignation.
             974          Section 62. Section 75-7-706 is enacted to read:
             975          75-7-706. Removal of trustee.
             976          (1) The settlor, a cotrustee, or a beneficiary may request the court to remove a trustee, or
             977      a trustee may be removed by the court on its own initiative.
             978          (2) The court may remove a trustee if:
             979          (a) the trustee has committed a serious breach of trust;
             980          (b) lack of cooperation among cotrustees substantially impairs the administration of the
             981      trust;
             982          (c) because of unfitness, unwillingness, or persistent failure of the trustee to administer the
             983      trust effectively, the court determines that removal of the trustee best serves the interests of the
             984      beneficiaries; or
             985          (d) there has been a substantial change of circumstances or removal is requested by all of
             986      the qualified beneficiaries, the court finds that removal of the trustee best serves the interests of
             987      all of the beneficiaries and is not inconsistent with a material purpose of the trust, and a suitable
             988      cotrustee or successor trustee is available.


             989          (3) Pending a final decision on a request to remove a trustee, or in lieu of or in addition
             990      to removing a trustee, the court may order appropriate relief under Subsection 75-7-1001 (2)
             991      necessary to protect the trust property or the interests of the beneficiaries.
             992          Section 63. Section 75-7-707 is enacted to read:
             993          75-7-707. Delivery of property by former trustee.
             994          (1) Unless a cotrustee remains in office or the court otherwise orders, and until the trust
             995      property is delivered to a successor trustee or other person entitled to it, a trustee who has resigned
             996      or been removed has the duties of a trustee and the powers necessary to protect the trust property.
             997          (2) A trustee who has resigned or been removed shall proceed expeditiously to deliver the
             998      trust property within the trustee's possession to the cotrustee, successor trustee, or other person
             999      entitled to it.
             1000          Section 64. Section 75-7-708 is enacted to read:
             1001          75-7-708. Compensation of trustee.
             1002          (1) If the terms of a trust do not specify the trustee's compensation, a trustee is entitled to
             1003      compensation that is reasonable under the circumstances.
             1004          (2) If the terms of a trust specify the trustee's compensation, the trustee is entitled to be
             1005      compensated as specified, but the court may allow more or less compensation if:
             1006          (a) the duties of the trustee are substantially different from those contemplated when the
             1007      trust was created; or
             1008          (b) the compensation specified by the terms of the trust would be unreasonably low or
             1009      high.
             1010          Section 65. Section 75-7-709 is enacted to read:
             1011          75-7-709. Reimbursement of expenses.
             1012          (1) A trustee is entitled to be reimbursed out of the trust property, with interest as
             1013      appropriate, for:
             1014          (a) expenses that were properly incurred in the administration of the trust; and
             1015          (b) to the extent necessary to prevent unjust enrichment of the trust, expenses that were
             1016      not properly incurred in the administration of the trust.
             1017          (2) An advance by the trustee of money for the protection of the trust gives rise to a lien
             1018      against trust property to secure reimbursement with reasonable interest.
             1019          Section 66. Section 75-7-801 is enacted to read:


             1020     
Part 8. Duties and Powers of Trustee

             1021          75-7-801. Duty to administer trust.
             1022          Upon acceptance of a trusteeship, the trustee shall administer the trust in good faith, in
             1023      accordance with its terms and purposes and the interests of the beneficiaries, and in accordance
             1024      with this chapter.
             1025          Section 67. Section 75-7-802 is enacted to read:
             1026          75-7-802. Duty of loyalty.
             1027          (1) A trustee shall administer the trust solely in the interests of the beneficiaries.
             1028          (2) Subject to the rights of persons dealing with or assisting the trustee as provided in
             1029      Section 75-7-1012 , a sale, encumbrance, or other transaction involving the investment or
             1030      management of trust property entered into by the trustee for the trustee's own personal account or
             1031      which is otherwise affected by a conflict between the trustee's fiduciary and personal interests is
             1032      voidable by a beneficiary affected by the transaction unless:
             1033          (a) the transaction was authorized by the terms of the trust;
             1034          (b) the transaction was approved by the court;
             1035          (c) the beneficiary did not commence a judicial proceeding within the time allowed by
             1036      Section 75-7-1005 ;
             1037          (d) the beneficiary consented to the trustee's conduct, ratified the transaction, or released
             1038      the trustee in compliance with Section 75-7-1009 ; or
             1039          (e) the transaction involves a contract entered into or claim acquired by the trustee before
             1040      the person became or contemplated becoming trustee.
             1041          (3) A sale, encumbrance, or other transaction involving the investment or management of
             1042      trust property is presumed to be affected by a conflict between personal and fiduciary interests if
             1043      it is entered into by the trustee with:
             1044          (a) the trustee's spouse;
             1045          (b) the trustee's descendants, siblings, parents, or their spouses;
             1046          (c) an agent or attorney of the trustee; or
             1047          (d) a corporation or other person or enterprise in which the trustee, or a person that owns
             1048      a significant interest in the trustee, has an interest that might affect the trustee's best judgment.
             1049          (4) A transaction between a trustee and a beneficiary that does not concern trust property
             1050      but that occurs during the existence of the trust or while the trustee retains significant influence


             1051      over the beneficiary and from which the trustee obtains an advantage is voidable by the beneficiary
             1052      unless the trustee establishes that the transaction was fair to the beneficiary.
             1053          (5) A transaction not concerning trust property in which the trustee engages in the trustee's
             1054      individual capacity involves a conflict between personal and fiduciary interests if the transaction
             1055      concerns an opportunity properly belonging to the trust.
             1056          (6) An investment by a trustee in securities of an investment company or investment trust
             1057      to which the trustee, or its affiliate, provides services in a capacity other than as trustee is not
             1058      presumed to be affected by a conflict between personal and fiduciary interests if the investment
             1059      complies with the prudent investor rule of Section 75-7-901 . The trustee may be compensated by
             1060      the investment company or investment trust for providing those services out of fees charged to the
             1061      trust if the trustee at least annually notifies the persons entitled under Section 75-7-813 to receive
             1062      a copy of the trustee's annual report of the rate and method by which the compensation was
             1063      determined.
             1064          (7) In voting shares of stock or in exercising powers of control over similar interests in
             1065      other forms of enterprise, the trustee shall act in the best interests of the beneficiaries. If the trust
             1066      is the sole owner of a corporation or other form of enterprise, the trustee shall elect or appoint
             1067      directors or other managers who will manage the corporation or enterprise in the best interests of
             1068      the beneficiaries.
             1069          (8) This section does not preclude the following transactions, if fair to the beneficiaries:
             1070          (a) an agreement between a trustee and a beneficiary relating to the appointment or
             1071      compensation of the trustee;
             1072          (b) payment of reasonable compensation to the trustee;
             1073          (c) a transaction between a trust and another trust, decedent's estate, or conservatorship of
             1074      which the trustee is a fiduciary or in which a beneficiary has an interest;
             1075          (d) a deposit of trust money in a regulated financial service institution operated by the
             1076      trustee; or
             1077          (e) an advance by the trustee of money for the protection of the trust.
             1078          (9) The court may appoint a special fiduciary to make a decision with respect to any
             1079      proposed transaction that might violate this section if entered into by the trustee.
             1080          Section 68. Section 75-7-803 is enacted to read:
             1081          75-7-803. Impartiality.


             1082          If a trust has two or more beneficiaries, the trustee shall act impartially in investing,
             1083      managing, and distributing the trust property, giving due regard to the beneficiaries' respective
             1084      interests.
             1085          Section 69. Section 75-7-804 is enacted to read:
             1086          75-7-804. Prudent administration.
             1087          A trustee shall administer the trust as a prudent person would, by considering the purposes,
             1088      terms, distributional requirements, and other circumstances of the trust. In satisfying this standard,
             1089      the trustee shall exercise reasonable care, skill, and caution.
             1090          Section 70. Section 75-7-805 is enacted to read:
             1091          75-7-805. Costs of administration.
             1092          In administering a trust, the trustee may incur only costs that are reasonable in relation to
             1093      the trust property, the purposes of the trust, and the skills of the trustee.
             1094          Section 71. Section 75-7-806 is enacted to read:
             1095          75-7-806. Trustee's skills.
             1096          A trustee who has special skills or expertise, or is named trustee in reliance upon the
             1097      trustee's representation that the trustee has special skills or expertise, shall use those special skills
             1098      or expertise.
             1099          Section 72. Section 75-7-807 is enacted to read:
             1100          75-7-807. Delegation by trustee.
             1101          (1) A trustee may delegate duties and powers that a prudent trustee of comparable skills
             1102      could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill,
             1103      and caution in:
             1104          (a) selecting an agent;
             1105          (b) establishing the scope and terms of the delegation, consistent with the purposes and
             1106      terms of the trust; and
             1107          (c) periodically reviewing the agent's actions in order to monitor the agent's performance
             1108      and compliance with the terms of the delegation.
             1109          (2) In performing a delegated function, an agent owes a duty to the trust to exercise
             1110      reasonable care to comply with the terms of the delegation.
             1111          (3) A trustee who complies with Subsection (1) is not liable to the beneficiaries or to the
             1112      trust for an action of the agent to whom the function was delegated.


             1113          (4) By accepting a delegation of powers or duties from the trustee of a trust that is subject
             1114      to the law of this state, an agent submits to the jurisdiction of the courts of this state.
             1115          Section 73. Section 75-7-808 is enacted to read:
             1116          75-7-808. Powers to direct.
             1117          (1) While a trust is revocable, the trustee may follow a direction of the settlor that is
             1118      contrary to the terms of the trust.
             1119          (2) If the terms of a trust confer upon a person other than the settlor of a revocable trust
             1120      power to direct certain actions of the trustee, the trustee shall act in accordance with an exercise
             1121      of the power unless the attempted exercise is manifestly contrary to the terms of the trust or the
             1122      trustee knows the attempted exercise would constitute a serious breach of a fiduciary duty that the
             1123      person holding the power owes to the beneficiaries of the trust.
             1124          (3) The terms of a trust may confer upon a trustee or other person a power to direct the
             1125      modification or termination of the trust.
             1126          (4) A person, other than a beneficiary, who holds a power to direct is presumptively a
             1127      fiduciary who, as such, is required to act in good faith with regard to the purposes of the trust and
             1128      the interests of the beneficiaries. The holder of a power to direct is liable for any loss that results
             1129      from breach of a fiduciary duty.
             1130          Section 74. Section 75-7-809 is enacted to read:
             1131          75-7-809. Control and protection of trust property.
             1132          A trustee shall take reasonable steps to take control of and protect the trust property.
             1133          Section 75. Section 75-7-810 is enacted to read:
             1134          75-7-810. Recordkeeping and identification of trust property.
             1135          (1) A trustee shall keep adequate records of the administration of the trust.
             1136          (2) A trustee shall keep trust property separate from the trustee's own property.
             1137          (3) Except as otherwise provided in Subsection (4), a trustee shall cause the trust property
             1138      to be designated so that the interest of the trust, to the extent feasible, appears in records
             1139      maintained by a party other than a trustee or beneficiary.
             1140          (4) If the trustee maintains records clearly indicating the respective interests, a trustee may
             1141      invest as a whole the property of two or more separate trusts.
             1142          Section 76. Section 75-7-811 is enacted to read:
             1143          75-7-811. Enforcement and defense of claims.


             1144          A trustee shall take reasonable steps to enforce claims of the trust and to defend claims
             1145      against the trust.
             1146          Section 77. Section 75-7-812 is enacted to read:
             1147          75-7-812. Collecting trust property.
             1148          A trustee shall take reasonable steps to compel a former trustee or other person to deliver
             1149      trust property to the trustee, and to redress a breach of trust known to the trustee to have been
             1150      committed by a former trustee.
             1151          Section 78. Section 75-7-813 is enacted to read:
             1152          75-7-813. Duty to inform and report.
             1153          (1) A trustee shall keep the qualified beneficiaries of the trust reasonably informed about
             1154      the administration of the trust and of the material facts necessary for them to protect their interests.
             1155      Unless unreasonable under the circumstances, a trustee shall promptly respond to a beneficiary's
             1156      request for information related to the administration of the trust.
             1157          (2) A trustee:
             1158          (a) upon request of a beneficiary, shall promptly furnish to the beneficiary a copy of the
             1159      trust instrument;
             1160          (b) within 60 days after accepting a trusteeship, shall notify the qualified beneficiaries of
             1161      the acceptance and of the trustee's name, address, and telephone number;
             1162          (c) within 60 days after the date the trustee acquires knowledge of the creation of an
             1163      irrevocable trust, or the date the trustee acquires knowledge that a formerly revocable trust has
             1164      become irrevocable, whether by the death of the settlor or otherwise, shall notify the qualified
             1165      beneficiaries of the trust's existence, of the identity of the settlor or settlors, of the right to request
             1166      a copy of the trust instrument, and of the right to a trustee's report as provided in Subsection (3);
             1167      and
             1168          (d) shall notify the qualified beneficiaries in advance of any change in the method or rate
             1169      of the trustee's compensation.
             1170          (3) A trustee shall send to the distributees or permissible distributees of trust income or
             1171      principal, and to other qualified or nonqualified beneficiaries who request it, at least annually and
             1172      at the termination of the trust, a report of the trust property, liabilities, receipts, and disbursements,
             1173      including the source and amount of the trustee's compensation, a listing of the trust assets and, if
             1174      feasible, their respective market values. Upon a vacancy in a trusteeship, unless a cotrustee


             1175      remains in office, a report must be sent to the qualified beneficiaries by the former trustee. A
             1176      personal representative, conservator, or guardian may send the qualified beneficiaries a report on
             1177      behalf of a deceased or incapacitated trustee.
             1178          (4) A beneficiary may waive the right to a trustee's report or other information otherwise
             1179      required to be furnished under this section. A beneficiary, with respect to future reports and other
             1180      information, may withdraw a waiver previously given.
             1181          Section 79. Section 75-7-814 is enacted to read:
             1182          75-7-814. Discretionary powers -- Tax savings.
             1183          (1) Notwithstanding the breadth of discretion granted to a trustee in the terms of the trust,
             1184      including the use of such terms as "absolute," "sole," or "uncontrolled," the trustee shall exercise
             1185      a discretionary power in good faith and in accordance with the terms and purposes of the trust and
             1186      the interests of the beneficiaries.
             1187          (2) Subject to Subsection (4), and unless the terms of the trust expressly indicate that a rule
             1188      in this Subsection (2) does not apply:
             1189          (a) a person other than a settlor who is a beneficiary and trustee of a trust that confers on
             1190      the trustee a power to make discretionary distributions to or for the trustee's personal benefit may
             1191      exercise the power only in accordance with an ascertainable standard relating to the trustee's
             1192      individual health, education, support, or maintenance within the meaning of Section 2041(b)(1)(A)
             1193      or 2514(c)(1) of the Internal Revenue Code of 1986, as in effect on May 1, 2002; and
             1194          (b) a trustee may not exercise a power to make discretionary distributions to satisfy a legal
             1195      obligation of support that the trustee personally owes another person.
             1196          (3) A power whose exercise is limited or prohibited by Subsection (2) may be exercised
             1197      by a majority of the remaining trustees whose exercise of the power is not limited or prohibited.
             1198      If the power of all trustees is limited or prohibited, the court may appoint a special fiduciary with
             1199      authority to exercise the power.
             1200          (4) Subsection (2) does not apply to:
             1201          (a) a power held by the settlor's spouse who is the trustee of a trust for which a marital
             1202      deduction, as defined in Section 2056(b)(5) or 2523(e) of the Internal Revenue Code of 1986, as
             1203      in effect on May 1, 2002, was previously allowed;
             1204          (b) any trust during any period that the trust may be revoked or amended by its settlor; or
             1205          (c) a trust if contributions to the trust qualify for the annual exclusion under Section


             1206      2503(c) of the Internal Revenue Code of 1986, as in effect on May 1, 2002.
             1207          Section 80. Section 75-7-815 is enacted to read:
             1208          75-7-815. General powers of trustee.
             1209          (1) A trustee, without authorization by the court, may exercise:
             1210          (a) powers conferred by the terms of the trust; or
             1211          (b) except as limited by the terms of the trust:
             1212          (i) all powers over the trust property which an unmarried competent owner has over
             1213      individually owned property;
             1214          (ii) any other powers appropriate to achieve the proper investment, management, and
             1215      distribution of the trust property; and
             1216          (iii) any other powers conferred by this chapter.
             1217          (2) The exercise of a power is subject to the fiduciary duties prescribed by this part.
             1218          Section 81. Section 75-7-816 is enacted to read:
             1219          75-7-816. Specific powers of trustee.
             1220          Without limiting the authority conferred by Section 75-7-815 , a trustee may:
             1221          (1) collect trust property and accept or reject additions to the trust property from a settlor
             1222      or any other person;
             1223          (2) acquire or sell property, for cash or on credit, at public or private sale;
             1224          (3) exchange, partition, or otherwise change the character of trust property;
             1225          (4) deposit trust money in an account in a regulated financial service institution;
             1226          (5) borrow money, with or without security, and mortgage or pledge trust property for a
             1227      period within or extending beyond the duration of the trust;
             1228          (6) with respect to an interest in a proprietorship, partnership, limited liability company,
             1229      business trust, corporation, or other form of business or enterprise, continue the business or other
             1230      enterprise and take any action that may be taken by shareholders, members, or property owners,
             1231      including merging, dissolving, or otherwise changing the form of business organization or
             1232      contributing additional capital;
             1233          (7) with respect to stocks or other securities, exercise the rights of an absolute owner,
             1234      including the right to:
             1235          (a) vote, or give proxies to vote, with or without power of substitution, or enter into or
             1236      continue a voting trust agreement;


             1237          (b) hold a security in the name of a nominee or in other form without disclosure of the trust
             1238      so that title may pass by delivery;
             1239          (c) pay calls, assessments, and other sums chargeable or accruing against the securities,
             1240      and sell or exercise stock subscription or conversion rights; and
             1241          (d) deposit the securities with a depository or other regulated financial service institution;
             1242          (8) with respect to an interest in real property, construct, or make ordinary or extraordinary
             1243      repairs to, alterations to, or improvements in, buildings or other structures, demolish
             1244      improvements, raze existing or erect new party walls or buildings, subdivide or develop land,
             1245      dedicate land to public use or grant public or private easements, and make or vacate plats and
             1246      adjust boundaries;
             1247          (9) enter into a lease for any purpose as lessor or lessee, including a lease or other
             1248      arrangement for exploration and removal of natural resources, with or without the option to
             1249      purchase or renew, for a period within or extending beyond the duration of the trust;
             1250          (10) grant an option involving a sale, lease, or other disposition of trust property or acquire
             1251      an option for the acquisition of property, including an option exercisable beyond the duration of
             1252      the trust, and exercise an option so acquired;
             1253          (11) insure the property of the trust against damage or loss and insure the trustee, the
             1254      trustee's agents, and beneficiaries against liability arising from the administration of the trust;
             1255          (12) abandon or decline to administer property of no value or of insufficient value to
             1256      justify its collection or continued administration;
             1257          (13) with respect to possible liability for violation of environmental law:
             1258          (a) inspect or investigate property the trustee holds or has been asked to hold, or property
             1259      owned or operated by an organization in which the trustee holds or has been asked to hold an
             1260      interest, for the purpose of determining the application of environmental law with respect to the
             1261      property;
             1262          (b) take action to prevent, abate, or otherwise remedy any actual or potential violation of
             1263      any environmental law affecting property held directly or indirectly by the trustee, whether taken
             1264      before or after the assertion of a claim or the initiation of governmental enforcement;
             1265          (c) decline to accept property into trust or disclaim any power with respect to property that
             1266      is or may be burdened with liability for violation of environmental law;
             1267          (d) compromise claims against the trust which may be asserted for an alleged violation of


             1268      environmental law; and
             1269          (e) pay the expense of any inspection, review, abatement, or remedial action to comply
             1270      with environmental law;
             1271          (14) pay or contest any claim, settle a claim by or against the trust, and release, in whole
             1272      or in part, a claim belonging to the trust;
             1273          (15) pay taxes, assessments, compensation of the trustee and of employees and agents of
             1274      the trust, and other expenses incurred in the administration of the trust;
             1275          (16) exercise elections with respect to federal, state, and local taxes;
             1276          (17) select a mode of payment under any employee benefit or retirement plan, annuity, or
             1277      life insurance payable to the trustee, exercise rights thereunder, including exercise of the right to
             1278      indemnification for expenses and against liabilities, and take appropriate action to collect the
             1279      proceeds;
             1280          (18) make loans out of trust property, including loans to a beneficiary on terms and
             1281      conditions the trustee considers to be fair and reasonable under the circumstances, and retaining
             1282      a lien on future distributions for repayment of those loans;
             1283          (19) pledge trust property to guarantee loans made by others to the beneficiary;
             1284          (20) appoint a trustee to act in another jurisdiction with respect to trust property located
             1285      in the other jurisdiction, confer upon the appointed trustee all of the powers and duties of the
             1286      appointing trustee, require that the appointed trustee furnish security, and remove any trustee so
             1287      appointed;
             1288          (21) pay any amount distributable to a beneficiary who is under a legal disability or who
             1289      the trustee reasonably believes is incapacitated, by paying it directly to the beneficiary or applying
             1290      it for the beneficiary's benefit, or by:
             1291          (a) paying it to the beneficiary's conservator or, if the beneficiary does not have a
             1292      conservator, the beneficiary's guardian;
             1293          (b) paying it to the beneficiary's custodian under Title 75, Chapter 5a, Uniform Transfers
             1294      to Minors Act and, for that purpose, creating a custodianship;
             1295          (c) if the trustee does not know of a conservator, guardian, or custodian, paying it to an
             1296      adult relative or other person having legal or physical care or custody of the beneficiary, to be
             1297      expended on the beneficiary's behalf; or
             1298          (d) managing it as a separate fund on the beneficiary's behalf, subject to the beneficiary's


             1299      continuing right to withdraw the distribution;
             1300          (22) on distribution of trust property or the division or termination of a trust, make
             1301      distributions in divided or undivided interests, allocate particular assets in proportionate or
             1302      disproportionate shares, value the trust property for those purposes, and adjust for resulting
             1303      differences in valuation;
             1304          (23) resolve a dispute concerning the interpretation of the trust or its administration by
             1305      mediation, arbitration, or other procedure for alternative dispute resolution;
             1306          (24) prosecute or defend an action, claim, or judicial proceeding in any jurisdiction to
             1307      protect trust property and the trustee in the performance of the trustee's duties;
             1308          (25) sign and deliver contracts and other instruments that are useful to achieve or facilitate
             1309      the exercise of the trustee's powers; and
             1310          (26) on termination of the trust, exercise the powers appropriate to wind up the
             1311      administration of the trust and distribute the trust property to the persons entitled to it.
             1312          Section 82. Section 75-7-817 is enacted to read:
             1313          75-7-817. Distribution upon termination.
             1314          (1) Upon termination or partial termination of a trust, the trustee may send to the
             1315      beneficiaries a proposal for distribution. The right of any beneficiary to object to the proposed
             1316      distribution terminates if the beneficiary does not notify the trustee of an objection within 30 days
             1317      after the proposal was sent but only if the proposal informed the beneficiary of the right to object
             1318      and of the time allowed for objection.
             1319          (2) Upon the occurrence of an event terminating or partially terminating a trust, the trustee
             1320      shall proceed expeditiously to distribute the trust property to the persons entitled to it, subject to
             1321      the right of the trustee to retain a reasonable reserve for the payment of debts, expenses, and taxes.
             1322          (3) A release by a beneficiary of a trustee from liability for breach of trust is invalid to the
             1323      extent:
             1324          (a) it was induced by improper conduct of the trustee; or
             1325          (b) the beneficiary, at the time of the release, did not know of the beneficiary's rights or
             1326      of the material facts relating to the breach.
             1327          Section 83. Section 75-7-901 is enacted to read:
             1328     
Part 9. Utah Uniform Prudent Investor Act

             1329          75-7-901. Prudent investor rule.


             1330          (1) Except as otherwise provided in Subsection (2), a trustee who invests and manages
             1331      trust assets owes a duty to the beneficiaries of the trust to comply with the prudent investor rule
             1332      set forth in this chapter.
             1333          (2) The prudent investor rule is a default rule and may be expanded, restricted, eliminated,
             1334      or otherwise altered by the provisions of a trust. A trustee is not liable to a beneficiary to the
             1335      extent that the trustee acted in reasonable reliance on the provisions of the trust.
             1336          Section 84. Section 75-7-902 is enacted to read:
             1337          75-7-902. Standard of care -- Portfolio strategy -- Risk and return objectives.
             1338          (1) A trustee shall invest and manage trust assets as a prudent investor would, by
             1339      considering the purposes, terms, distribution requirements, and other circumstances of the trust.
             1340      In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.
             1341          (2) A trustee's investment and management decisions respecting individual assets must be
             1342      evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an
             1343      overall investment strategy having risk and return objectives reasonably suited to the trust.
             1344          (3) Among circumstances that a trustee shall consider in investing and managing trust
             1345      assets are the following which may be relevant to the trust or its beneficiaries:
             1346          (a) general economic conditions;
             1347          (b) the possible effect of inflation or deflation;
             1348          (c) the expected tax consequences of investment decisions or strategies;
             1349          (d) the role that each investment or course of action plays within the overall trust portfolio,
             1350      which may include financial assets, interests in closely held enterprises, tangible and intangible
             1351      personal property, and real property;
             1352          (e) the expected total return from income and the appreciation of capital;
             1353          (f) other resources of the beneficiaries;
             1354          (g) needs for liquidity, regularity of income, and preservation or appreciation of capital;
             1355      and
             1356          (h) an asset's special relationship or special value, if any, to the purposes of the trust or to
             1357      one or more of the beneficiaries.
             1358          (4) A trustee shall make a reasonable effort to verify facts relevant to the investment and
             1359      management of trust assets.
             1360          (5) A trustee may invest in any kind of property or type of investment consistent with the


             1361      standards of this chapter.
             1362          Section 85. Section 75-7-903 is enacted to read:
             1363          75-7-903. Diversification.
             1364          A trustee shall diversify the investments of the trust unless the trustee reasonably
             1365      determines that, because of special circumstances, the purposes of the trust are better served
             1366      without diversifying.
             1367          Section 86. Section 75-7-904 is enacted to read:
             1368          75-7-904. Duties at inception of trusteeship.
             1369          Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee
             1370      shall review the trust assets and make and implement decisions concerning the retention and
             1371      disposition of assets, in order to bring the trust portfolio into compliance with the purposes, terms,
             1372      distribution requirements, and other circumstances of the trust, and with the requirements of this
             1373      chapter.
             1374          Section 87. Section 75-7-905 is enacted to read:
             1375          75-7-905. Reviewing compliance.
             1376          Compliance with the prudent investor rule is determined in light of the facts and
             1377      circumstances existing at the time of a trustee's decision or action and not by hindsight.
             1378          Section 88. Section 75-7-906 is enacted to read:
             1379          75-7-906. Language invoking standard of chapter.
             1380          The following terms or comparable language in the provisions of a trust, unless otherwise
             1381      limited or modified, authorizes any investment or strategy permitted under this chapter:
             1382      "investments permissible by law for investment of trust funds," "legal investments," "authorized
             1383      investments," "using the judgment and care under the circumstances then prevailing that persons
             1384      of prudence, discretion, and intelligence exercise in the management of their own affairs, not in
             1385      regard to speculation but in regard to the permanent disposition of their funds, considering the
             1386      probable income as well as the probable safety of their capital," "prudent man rule," "prudent
             1387      trustee rule," "prudent person rule," and "prudent investor rule."
             1388          Section 89. Section 75-7-1001 is enacted to read:
             1389     
Part 10. Liability of Trustees and Rights of Persons Dealing with Trustee

             1390          75-7-1001. Remedies for breach of trust.
             1391          (1) A violation by a trustee of a duty the trustee owes to a beneficiary is a breach of trust.


             1392          (2) To remedy a breach of trust that has occurred or may occur, the court may:
             1393          (a) compel the trustee to perform the trustee's duties;
             1394          (b) enjoin the trustee from committing a breach of trust;
             1395          (c) compel the trustee to redress a breach of trust by paying money, restoring property, or
             1396      other means;
             1397          (d) order a trustee to account;
             1398          (e) appoint a special fiduciary to take possession of the trust property and administer the
             1399      trust;
             1400          (f) suspend the trustee;
             1401          (g) remove the trustee as provided in Section 75-7-706 ;
             1402          (h) reduce or deny compensation to the trustee;
             1403          (i) subject to Section 75-7-1012 , void an act of the trustee, impose a lien or a constructive
             1404      trust on trust property, or trace trust property wrongfully disposed of and recover the property or
             1405      its proceeds; or
             1406          (j) order any other appropriate relief.
             1407          Section 90. Section 75-7-1002 is enacted to read:
             1408          75-7-1002. Damages for breach of trust.
             1409          (1) A trustee who commits a breach of trust is liable to the beneficiaries affected for the
             1410      greater of:
             1411          (a) the amount required to restore the value of the trust property and trust distributions to
             1412      what they would have been had the breach not occurred; or
             1413          (b) the profit the trustee made by reason of the breach.
             1414          (2) Except as otherwise provided in this Subsection (2), if more than one trustee is liable
             1415      to the beneficiaries for a breach of trust, a trustee is entitled to contribution from the other trustee
             1416      or trustees. A trustee is not entitled to contribution if the trustee was substantially more at fault
             1417      than another trustee or if the trustee committed the breach of trust in bad faith or with reckless
             1418      indifference to the purposes of the trust or the interests of the beneficiaries. A trustee who received
             1419      a benefit from the breach of trust is not entitled to contribution from another trustee to the extent
             1420      of the benefit received.
             1421          Section 91. Section 75-7-1003 is enacted to read:
             1422          75-7-1003. Damages in absence of breach.


             1423          (1) A trustee is accountable to an affected beneficiary for any profit made by the trustee
             1424      arising from the administration of the trust, even absent a breach of trust.
             1425          (2) Absent a breach of trust, a trustee is not liable to a beneficiary for a loss or depreciation
             1426      in the value of trust property or for not having made a profit.
             1427          Section 92. Section 75-7-1004 is enacted to read:
             1428          75-7-1004. Attorney's fees and costs.
             1429          In a judicial proceeding involving the administration of a trust, the court may, as justice and
             1430      equity may require, award costs and expenses, including reasonable attorney's fees, to any party,
             1431      to be paid by another party or from the trust that is the subject of the controversy.
             1432          Section 93. Section 75-7-1005 is enacted to read:
             1433          75-7-1005. Limitation of action against trustee.
             1434          (1) A beneficiary may not commence a proceeding against a trustee for breach of trust
             1435      more than one year after the date the beneficiary or a representative of the beneficiary was sent a
             1436      report that adequately disclosed the existence of a potential claim for breach of trust and informed
             1437      the beneficiary of the time allowed for commencing a proceeding.
             1438          (2) A report adequately discloses the existence of a potential claim for breach of trust if
             1439      it provides sufficient information so that the beneficiary or representative knows of the potential
             1440      claim or should have inquired into its existence.
             1441          (3) If Subsection (1) does not apply, a judicial proceeding by a beneficiary against a trustee
             1442      for breach of trust must be commenced within five years after the first to occur of:
             1443          (a) the removal, resignation, or death of the trustee;
             1444          (b) the termination of the beneficiary's interest in the trust; or
             1445          (c) the termination of the trust.
             1446          Section 94. Section 75-7-1006 is enacted to read:
             1447          75-7-1006. Reliance on trust instrument.
             1448          A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust
             1449      instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from
             1450      the reliance.
             1451          Section 95. Section 75-7-1007 is enacted to read:
             1452          75-7-1007. Event affecting administration or distribution.
             1453          If the happening of an event, including marriage, divorce, performance of educational


             1454      requirements, or death, affects the administration or distribution of a trust, a trustee who has
             1455      exercised reasonable care to ascertain the happening of the event is not liable for a loss resulting
             1456      from the trustee's lack of knowledge.
             1457          Section 96. Section 75-7-1008 is enacted to read:
             1458          75-7-1008. Exculpation of trustee.
             1459          (1) A term of a trust relieving a trustee of liability for breach of trust is unenforceable to
             1460      the extent that it:
             1461          (a) relieves the trustee of liability for breach of trust committed in bad faith or with
             1462      reckless indifference to the purposes of the trust or the interests of the beneficiaries; or
             1463          (b) was inserted as the result of an abuse by the trustee of a fiduciary or confidential
             1464      relationship to the settlor.
             1465          (2) An exculpatory term drafted or caused to be drafted by the trustee is invalid as an abuse
             1466      of a fiduciary or confidential relationship unless the trustee proves that the exculpatory term is fair
             1467      under the circumstances and that its existence and contents were adequately communicated to the
             1468      settlor.
             1469          Section 97. Section 75-7-1009 is enacted to read:
             1470          75-7-1009. Beneficiary's consent, release, or ratification.
             1471          A trustee is not liable to a beneficiary for breach of trust if the beneficiary, while having
             1472      capacity, consented to the conduct constituting the breach, released the trustee from liability for
             1473      the breach, or ratified the transaction constituting the breach, unless:
             1474          (1) the consent, release, or ratification of the beneficiary was induced by improper conduct
             1475      of the trustee; or
             1476          (2) at the time of the consent, release, or ratification, the beneficiary did not know of the
             1477      beneficiary's rights or of the material facts relating to the breach.
             1478          Section 98. Section 75-7-1010 is enacted to read:
             1479          75-7-1010. Limitation on personal liability of trustee.
             1480          (1) Except as otherwise provided in the contract, a trustee is not personally liable on a
             1481      contract properly entered into in the trustee's fiduciary capacity in the course of administering the
             1482      trust if the trustee in the contract disclosed the fiduciary capacity.
             1483          (2) A trustee is personally liable for torts committed in the course of administering a trust,
             1484      or for obligations arising from ownership or control of trust property, including liability for


             1485      violation of environmental law, only if the trustee is personally at fault.
             1486          (3) A claim based on a contract entered into by a trustee in the trustee's fiduciary capacity,
             1487      on an obligation arising from ownership or control of trust property, or on a tort committed in the
             1488      course of administering a trust, may be asserted in a judicial proceeding against the trustee in the
             1489      trustee's fiduciary capacity, whether or not the trustee is personally liable for the claim.
             1490          Section 99. Section 75-7-1011 is enacted to read:
             1491          75-7-1011. Interest as general partner.
             1492          (1) Except as otherwise provided in Subsection (3) or unless personal liability is imposed
             1493      in the contract, a trustee who holds an interest as a general partner in a general or limited
             1494      partnership is not personally liable on a contract entered into by the partnership after the trust's
             1495      acquisition of the interest if the fiduciary capacity was disclosed in the contract or in a statement
             1496      previously filed pursuant to Title 48, Chapter 2a, Utah Revised Uniform Limited Partnership Act.
             1497          (2) Except as otherwise provided in Subsection (3), a trustee who holds an interest as a
             1498      general partner is not personally liable for torts committed by the partnership or for obligations
             1499      arising from ownership or control of the interest unless the trustee is personally at fault.
             1500          (3) The immunity provided by this section does not apply if an interest in the partnership
             1501      is held by the trustee in a capacity other than that of trustee or is held by the trustee's spouse or one
             1502      or more of the trustee's descendants, siblings, or parents, or the spouse of any of them.
             1503          (4) If the trustee of a revocable trust holds an interest as a general partner, the settlor is
             1504      personally liable for contracts and other obligations of the partnership as if the settlor were a
             1505      general partner.
             1506          Section 100. Section 75-7-1012 is enacted to read:
             1507          75-7-1012. Protection of person dealing with trustee.
             1508          (1) A person other than a beneficiary who in good faith assists a trustee, or who in good
             1509      faith and for value deals with a trustee, without knowledge that the trustee is exceeding or
             1510      improperly exercising the trustee's powers is protected from liability as if the trustee properly
             1511      exercised the power.
             1512          (2) A person other than a beneficiary who in good faith deals with a trustee is not required
             1513      to inquire into the extent of the trustee's powers or the propriety of their exercise.
             1514          (3) A person who in good faith delivers assets to a trustee need not ensure their proper
             1515      application.


             1516          (4) A person other than a beneficiary who in good faith assists a former trustee, or who in
             1517      good faith and for value deals with a former trustee, without knowledge that the trusteeship has
             1518      terminated is protected from liability as if the former trustee were still a trustee.
             1519          (5) Comparable protective provisions of other laws relating to commercial transactions or
             1520      transfer of securities by fiduciaries prevail over the protection provided by this section.
             1521          Section 101. Section 75-7-1013 is enacted to read:
             1522          75-7-1013. Certification of trust.
             1523          (1) Instead of furnishing a copy of the trust instrument to a person other than a beneficiary,
             1524      the trustee may furnish to the person a certification of trust containing the following information:
             1525          (a) that the trust exists and the date the trust instrument was executed;
             1526          (b) the identity of the settlor;
             1527          (c) the identity and address of the currently acting trustee;
             1528          (d) the powers of the trustee;
             1529          (e) the revocability or irrevocability of the trust and the identity of any person holding a
             1530      power to revoke the trust;
             1531          (f) the authority of cotrustees to sign or otherwise authenticate and whether all or less than
             1532      all are required in order to exercise powers of the trustee;
             1533          (g) the trust's taxpayer identification number; and
             1534          (h) the manner of taking title to trust property.
             1535          (2) A certification of trust may be signed or otherwise authenticated by any trustee.
             1536          (3) A certification of trust must state that the trust has not been revoked, modified, or
             1537      amended in any manner that would cause the representations contained in the certification of trust
             1538      to be incorrect.
             1539          (4) A certification of trust need not contain the dispositive terms of a trust.
             1540          (5) A recipient of a certification of trust may require the trustee to furnish copies of those
             1541      excerpts from the original trust instrument and later amendments which designate the trustee and
             1542      confer upon the trustee the power to act in the pending transaction.
             1543          (6) A person who acts in reliance upon a certification of trust without knowledge that the
             1544      representations contained in it are incorrect is not liable to any person for acting and may assume
             1545      without inquiry the existence of the facts contained in the certification. Knowledge of the terms
             1546      of the trust may not be inferred solely from the fact that a copy of all or part of the trust instrument


             1547      is held by the person relying upon the certification.
             1548          (7) A person who in good faith enters into a transaction in reliance upon a certification of
             1549      trust may enforce the transaction against the trust property as if the representations contained in
             1550      the certification were correct.
             1551          (8) A person making a demand for the trust instrument in addition to a certification of trust
             1552      or excerpts is liable for damages if the court determines that the person did not act in good faith
             1553      in demanding the trust instrument.
             1554          (9) This section does not limit the right of a person to obtain a copy of the trust instrument
             1555      in a judicial proceeding concerning the trust.
             1556          Section 102. Section 75-7-1101 is enacted to read:
             1557     
Part 11. Miscellaneous Provisions

             1558          75-7-1101. Uniformity of application and construction.
             1559          In applying and construing this uniform act, consideration must be given to the need to
             1560      promote uniformity of the law with respect to its subject matter among states that enact it.
             1561          Section 103. Section 75-7-1102 is enacted to read:
             1562          75-7-1102. Electronic records and signatures.
             1563          The provisions of this chapter governing the legal effect, validity, or enforceability of
             1564      electronic records or electronic signatures, and of contracts formed or performed with the use of
             1565      such records or signatures, conform to the requirements of Section 102 of the Electronic Signatures
             1566      in Global and National Commerce Act (15 U.S.C. 7002) and supersede, modify, and limit the
             1567      requirements of the Electronic Signatures in Global and National Commerce Act.
             1568          Section 104. Section 75-7-1103 is enacted to read:
             1569          75-7-1103. Application to existing relationships.
             1570          (1) Except as otherwise provided, this chapter applies to:
             1571          (a) all trusts created before, on, or after May 1, 2002;
             1572          (b) all judicial proceedings concerning trusts commenced on or after May 1, 2002; and
             1573          (c) judicial proceedings concerning trusts commenced before May 1, 2002 unless the court
             1574      finds that application of a particular provision of this chapter would substantially interfere with the
             1575      effective conduct of the judicial proceedings or prejudice the rights of the parties, in which case
             1576      the particular provision of this chapter shall not apply and the superseded section will apply.
             1577          (2) Any rule of construction or presumption provided in this chapter applies to trust


             1578      instruments executed before May 1, 2002 unless there is a clear indication of a contrary intent in
             1579      the terms of the trust.
             1580          (3) Any act done before May 1, 2002 is not affected by this chapter.
             1581          (4) If a right is acquired, extinguished, or barred upon the expiration of a prescribed period
             1582      that has commenced to run under any other statute before May 1, 2002, that statute continues to
             1583      apply to the right even if it has been repealed or superseded.
             1584          Section 105. Repealer.
             1585          This act repeals:
             1586          Section 75-7-205, Court -- Concurrent jurisdiction of litigation involving trusts and
             1587      third parties.
             1588          Section 75-7-206, Proceedings for review of employment of agents and review of
             1589      compensation of trustee and employees of trust.
             1590          Section 75-7-207, Trust proceedings -- Initiation by notice -- Necessary parties.
             1591          Section 75-7-306, Personal liability of trustee to third parties.
             1592          Section 75-7-307, Limitations on proceedings against trustees after final account.




Legislative Review Note
    as of 12-17-01 11:11 AM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


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