Title 14A, Title 14A: Trusts

§ 1405. Application; governing law This chapter applies to a trust created before, on, or after the effective date of this act that: (1) has its principal place of administration in this State, including a trust whose principal place of administration has been changed to this Sta…

§ 1406. Reasonable reliance A trustee or other person who reasonably relies on the validity of a distribution of part or all of the property of a trust to another trust, or a modification of a trust, under this chapter, law of this State other than this chapter, or the law of ano…

§ 1407. Notice; exercise of decanting power (a) In this section, a notice period begins on the day notice is given under subsection (c) of this section and ends 59 days after the day notice is given. (b) Except as otherwise provided in this chapter, an authorized fiduciary may ex…

§ 1408. Representation (a) Notice to a person with authority to represent and bind another person under a first trust instrument or the Vermont Trust Code has the same effect as notice given directly to the person represented. (b) Consent of or waiver by a person with authority t…

§ 1409. Court involvement (a) The court may, upon application of an authorized fiduciary, a person entitled to notice under subsection 1407(c) of this title, a beneficiary, or, with respect to a charitable interest, the Attorney General or another person with standing to enforce …

§ 1410. Formalities An exercise of the decanting power shall be made in a record signed by an authorized fiduciary. The signed record shall, directly or by reference to the notice required by section 1407 of this title, identify the first trust and the second trust or trusts and …

§ 1411. Decanting power under expanded distributive discretion (a) As used in this section: (1) “Noncontingent right” means a right that is not subject to the exercise of discretion or the occurrence of a specified event that is not certain to occur. The term does not include a r…

§ 1412. Decanting power under limited distributive discretion (a) As used in this section, “limited distributive discretion” means a discretionary power of distribution that is limited to an ascertainable standard or a reasonably definite standard. (b) An authorized fiduciary who…

§ 1413. Trust for beneficiary with disability (a) As used in this section: (1) “Beneficiary with a disability” means a beneficiary of a first trust who the special-needs fiduciary believes may qualify for governmental benefits based on disability, whether or not the beneficiary c…

§ 1414. Protection of charitable interest (a) As used in this section: (1) “Determinable charitable interest” means a charitable interest that is a right to a mandatory distribution currently, periodically, on the occurrence of a specified event, or after the passage of a specifi…

§ 1415. Trust limitation on decanting (a) An authorized fiduciary shall not exercise the decanting power to the extent the first trust instrument expressly prohibits exercise of: (1) the decanting power; or (2) a power granted by State law to the authorized fiduciary to distribut…

§ 1416. Change in compensation (a) If a first-trust instrument specifies an authorized fiduciary’s compensation, the fiduciary shall not exercise the decanting power to increase the fiduciary’s compensation above the specified compensation unless: (1) all qualified beneficiaries …

§ 1417. Relief from liability and indemnification (a) Except as otherwise provided in this section, a second-trust instrument shall not relieve an authorized fiduciary from liability for breach of trust to a greater extent than the first trust instrument. (b) A second-trust instr…

§ 1418. Removal or replacement of authorized fiduciary An authorized fiduciary shall not exercise the decanting power to modify a provision in a first-trust instrument granting another person power to remove or replace the fiduciary unless: (1) the person holding the power consen…

§ 1419. Tax-related limitations (a) As used in this section: (1) “Grantor trust” means a trust as to which a settlor of a first trust is considered the owner under 26 U.S.C. §§ 671–677 or 26 U.S.C. § 679. (2) “Internal Revenue Code” means the U.S. Internal Revenue Code of 1986. (…

§ 1420. Duration of second trust (a) Subject to subsection (b) of this section, a second trust may have a duration that is the same as or different from the duration of the first trust. (b) To the extent that property of a second trust is attributable to property of the first tru…

§ 1421. Need to distribute not required An authorized fiduciary may exercise the decanting power whether or not under the first trust’s discretionary distribution standard the fiduciary would have made or could have been compelled to make a discretionary distribution of principal…

§ 1422. Savings provision (a) If exercise of the decanting power would be effective under this chapter except that the second-trust instrument in part does not comply with this chapter, the exercise of the power is effective and the following rules apply with respect to the princ…

§ 1423. Trust for care of animal (a) As used in this section: (1) “Animal trust” means a trust or an interest in a trust created to provide for the care of one or more animals. (2) “Protector” means a person appointed in an animal trust to enforce the trust on behalf of the anima…

§ 1424. Terms of second trust A reference in the Vermont Trust Code to a trust instrument or terms of the trust includes a second-trust instrument and the terms of the second trust. (Added 2023, No. 177 (Adj. Sess.), § 1, eff. July 1, 2024.)

§ 1425. Settlor (a) For purposes of the law of this State other than this chapter and subject to subsection (b) of this section, a settlor of a first trust is deemed to be the settlor of the second trust with respect to the portion of the principal of the first trust subject to t…

§ 1426. Later-discovered property (a) Except as otherwise provided in subsection (c) of this section, if exercise of the decanting power was intended to distribute all the principal of the first trust to one or more second trusts, later discovered property belonging to the first …

§ 1427. Obligations A debt, liability, or other obligation enforceable against property of a first trust is enforceable to the same extent against the property when held by the second trust after exercise of the decanting power. (Added 2023, No. 177 (Adj. Sess.), § 1, eff. July 1…

§ 1428. Uniformity of application and construction In applying and construing this Uniform Act, consideration shall be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it. (Added 2023, No. 177 (Adj. Sess.), § 1, eff. Ju…

§ 1429. Relation to Electronic Signatures in Global and National Commerce Act This chapter modifies, limits, or supersedes the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. §§ 7001 et seq., but does not modify, limit, or supersede subsection 101(c) of that …