Title 14A, Title 14A: Trusts

§ 105. Default and mandatory rules (a) Except as otherwise provided in the terms of the trust, this title governs the duties and powers of a trustee, relations among trustees, and the rights and interests of a beneficiary. (b) The terms of a trust prevail over any provision of th…

§ 106. Common law of trusts; principles of equity The common law of trusts and principles of equity supplement this title, except to the extent modified by this title or another statute of this state. (Added 2009, No. 20, § 1.)

§ 107. Governing law The meaning and effect of the terms of a trust are determined by: (1) the law of the jurisdiction designated in the terms unless the designation of that jurisdiction’s law is contrary to a strong public policy of the jurisdiction having the most significant r…

§ 108. Principal place of administration (a) Without precluding other means for establishing a sufficient connection with the designated jurisdiction, terms of a trust designating the principal place of administration are valid and controlling if: (1) a trustee’s principal place …

§ 109. Methods and waiver of notice (a) Notice to a person under this title or the sending of a document to a person under this title must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document. Permissibl…

§ 110. Others treated as qualified beneficiaries (a) Whenever notice to qualified beneficiaries of a trust is required under this title, the trustee shall also give notice to any other beneficiary who has sent the trustee a request for notice. (b)(1) A charitable organization exp…

§ 111. Nonjudicial settlement agreements (a) For purposes of this section, “interested persons” means persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the Probate Division of the Superior Court. (b) Except as o…

§ 112. Rules of construction The rules of construction that apply in this State to the interpretation of and disposition of property by will also apply as appropriate to the interpretation of the terms of a trust and the disposition of the trust property. (Added 2009, No. 20, § 1…

§ 201. Role of court in administration of trust (a) The Probate Division of the Superior Court may intervene in the administration of a trust to the extent its jurisdiction is invoked by an interested person or as provided by law. (b) A trust is not subject to continuing judicial…

§ 202. Jurisdiction over trustee and beneficiary (a) By accepting the trusteeship of a trust having its principal place of administration in this State or by moving the principal place of administration to this State, the trustee submits personally to the jurisdiction of the cour…

§ 203. Subject matter jurisdiction (a) The Probate Division of the Superior Court has exclusive jurisdiction of proceedings in this State brought by a trustee or beneficiary concerning the administration of a trust. (b) The Probate Division of the Superior Court has concurrent ju…

§ 204. Venue (a) Except as otherwise provided in subsection (b) of this section, venue for a judicial proceeding involving a trust is in the probate district of this State in which the trust’s principal place of administration is or will be located and, if the trust is created by…

§ 205. Matters in equity The Probate Division of the Superior Court may hear and determine in equity all matters relating to trusts in this title. (Added 2009, No. 20, § 1; amended 2009, No. 154 (Adj. Sess.), § 236, eff. Feb. 1, 2011.)

§ 301. Representation; basic effect (a) Notice to a person who may represent and bind another person under this chapter has the same effect as if notice were given directly to the other person. (b) The consent of a person who may represent and bind another person under this chapt…

§ 302. Representation by holder of general testamentary power of appointment To the extent there is no conflict of interest between the holder of a general testamentary power of appointment and the persons represented with respect to the particular question or dispute, the holder…

§ 303. Representation by fiduciaries and parents To the extent there is no conflict of interest between the representative and the person represented or among those being represented with respect to a particular question or dispute: (1) a guardian of the property may represent an…

§ 304. Representation by person having substantially identical interest Unless otherwise represented, a minor, incapacitated, or unborn individual, or a person whose identity or location is unknown and not reasonably ascertainable, may be represented by and bound by another havin…

§ 305. Appointment of representative (a) If the Probate Division of the Superior Court determines that an interest is not represented under this chapter, or that the otherwise available representation might be inadequate, the Probate Division of the Superior Court may appoint a r…

§ 401. Methods of creating trust A trust may be created: (1) by transfer of property to another person as trustee or to the trust in the trust’s name during the settlor’s lifetime or by will or other disposition taking effect upon the settlor’s death; (2) by declaration by the ow…

§ 402. Requirements for creation (a) A trust is created only if: (1) the settlor has capacity to create a trust; (2) the settlor indicates an intention to create the trust; (3) the trust has a definite beneficiary or is: (A) a charitable trust; (B) a trust for the care of an anim…

§ 403. Trusts created in other jurisdictions A trust not created by will is validly created if its creation complies with the law of the jurisdiction in which the trust instrument was executed, or the law of the jurisdiction in which, at the time of creation: (1) the settlor was …

§ 404. Trust purposes A trust may be created only to the extent its purposes are lawful, not contrary to public policy, and possible to achieve. A trust and its terms must be for the benefit of its beneficiaries. (Added 2009, No. 20, § 1.)

§ 405. Charitable purposes; enforcement (a) A charitable trust may be created for the relief of poverty; the advancement of education or religion; the promotion of health, scientific, literary, benevolent, governmental, or municipal purposes; or other purposes the achievement of …

§ 406. Creation of trust induced by fraud, duress, or undue influence A trust is void to the extent its creation was induced by fraud, duress, or undue influence. (Added 2009, No. 20, § 1.)

§ 407. Evidence of oral trust Except as required by a statute other than this title, a trust need not be evidenced by a trust instrument, but the creation of an oral trust and its terms may be established only by clear and convincing evidence. (Added 2009, No. 20, § 1.)

§ 408. Trust for care of animal (a) A trust may be created to provide for the care of an animal alive during the settlor’s lifetime. The trust terminates upon the death of the animal or, if the trust was created to provide for the care of more than one animal alive during the set…

§ 409. Noncharitable trust without ascertainable beneficiary Except as otherwise provided in section 408 of this title or by another statute, the following rules apply: (1) A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficia…

§ 410. Modification or termination of trust; proceedings for approval or disapproval (a) In addition to the methods of termination prescribed by sections 411 through 414 of this title, a trust terminates to the extent the trust is revoked or expires pursuant to its terms, no purp…

§ 411. Modification or termination of noncharitable irrevocable trust by consent (a) A noncharitable irrevocable trust may be modified or terminated upon consent of the settlor and all beneficiaries, even if the modification or termination is inconsistent with a material purpose …

§ 412. Modification or termination because of unanticipated circumstances or inability to administer trust effectively (a) The Probate Division of the Superior Court may modify the administrative or dispositive terms of a trust or terminate the trust if, because of circumstances …

§ 413. Cy pres (a) Except as otherwise provided in subsection (b) of this section, if a particular charitable purpose becomes unlawful, impracticable, impossible to achieve, or wasteful: (1) the trust does not fail, in whole or in part; (2) the trust property does not revert to t…

§ 414. Modification or termination of uneconomic trust (a) After notice to the qualified beneficiaries, the trustee of a trust consisting of trust property having a total value less than $100,000.00 may terminate the trust if the trustee concludes that the value of the trust prop…

§ 415. Reformation to correct mistakes The Probate Division of the Superior Court may reform the terms of a trust, even if unambiguous, to conform the terms to the settlor’s intention if it is proved by clear and convincing evidence that both the settlor’s intent and the terms of…

§ 416. Modification to achieve settlor’s tax objectives The Probate Division of the Superior Court may modify the terms of a trust to achieve the settlor’s tax objectives if the modification is not contrary to the settlor’s probable intention. The Probate Division of the Superior…

§ 417. Combination and division of trusts After notice to the qualified beneficiaries, a trustee may combine two or more trusts into a single trust or divide a trust into two or more separate trusts if the result does not impair rights of any beneficiary or adversely affect achie…

§ 418. Intentional and unlawful killing; termination of interest in trust (a) A person who commits an intentional and unlawful killing shall forfeit an interest in a trust: (1) to the extent the trust was funded by the victim of the intentional and unlawful killing or would be fu…

§ 501. Rights of beneficiary’s creditor or assignee To the extent a beneficiary’s interest is not protected by a spendthrift provision, the Probate Division of the Superior Court may authorize a creditor or assignee of the beneficiary to reach the beneficiary’s interest by attach…

§ 502. Spendthrift provision (a) A spendthrift provision is valid only if it restrains both voluntary and involuntary transfer of a beneficiary’s interest. (b) A term of a trust providing that the interest of a beneficiary is held subject to a “spendthrift trust,” or words of sim…

§ 503. Exceptions to spendthrift provision (a) In this section, “child” includes any person for whom an order or judgment for child support has been entered in this or another state. (b) A spendthrift provision is unenforceable against: (1) a beneficiary’s child who has a judgmen…

§ 504. Discretionary trusts; effect of standard (a) In this section, “child” includes any person for whom an order or judgment for child support has been entered in this or another state. (b) Except as otherwise provided in subsection (c) of this section, whether or not a trust c…

§ 505. Creditor’s claim against settlor (a) Whether or not the terms of a trust contain a spendthrift provision, the following rules apply: (1) During the lifetime of the settlor, the property of a revocable trust is subject to claims of the settlor’s creditors. (2) With respect …

§ 506. Overdue distribution (a) In this section, “mandatory distribution” means a distribution of income or principal which the trustee is required to make to a beneficiary under the terms of the trust, including a distribution upon termination of the trust. The term does not inc…

§ 507. Personal obligation of trustee Trust property is not subject to personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt. (Added 2009, No. 20, § 1.)

§ 601. Capacity of settlor of revocable trust The capacity of a settlor required to create, amend, revoke, or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that required to make a will. (Added 2009, No. 20, § 1.)

§ 602. Revocation or amendment of revocable trust (a) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. This subsection does not apply to a trust created under an instrument executed before the effective date o…

§ 603. Settlor’s powers; powers of withdrawal (a) While a trust is revocable, rights of the beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the settlor. (b) During the period the power may be exercised, the holder of a power of …