Introduced By: Senator Blais
Date Introduced : February 9, 1999
Referred To: Committee on Judiciary
It is enacted by the General Assembly as follows:
SECTION 1. Section 18-1-2 of the General Laws in Chapter 18-1 entitled "Application of Laws to Trusts" is hereby amended to read as follows:
18-1-2. Law expressly applicable when trustees are within
state. -- Whenever a person, whether or not a resident
of this state and whether or not a citizen of the United States,
hereafter creates a trust of personal property by deed, agreement,
will, or otherwise, and: (1) the instrument creating the trust
provides in substance that it shall be construed and regulated
by the law of this state, and (2) the trust is to be or is in
fact administered in this state, and (3) the trustee, or if more
than one at least one of them, is a resident of this state or
a domestic corporation or national bank located within this state
duly authorized by law to act as trustee, the validity, construction,
effect, and administration of the trust shall be determined and
governed by the law of this state without reference to the law
of any other state {DEL . DEL} {ADD and a memorandum or summary
of said trust shall be filed in the land evidence records office
in the city or town of the principal place of administration. ADD}
SECTION 2. Chapter 18-1 of the General Laws entitled "Application of Laws to Trusts" is hereby amended by adding thereto the following section:
{ADD 18-1-2.1. Filing of statement. -- ADD} {ADD Filing shall be accomplished by filing a statement indicating the name and address of the trustee in which it acknowledges the trusteeship. The statement shall indicate whether the trust has been registered elsewhere. The statement shall identify the trust: (1) in the case of a testamentary trust, by the name of the testator and the date and place of domiciliary probate; (2) in the case of a written inter vivios trust, by the name of each settlor and the original trustee and the date of the trust instrument; or (3) in the case of an oral trust, by information identifying the settlor or other source of funds and describing the time and manner of the trust's creation and the terms of the trust, including the subject matter, beneficiaries and time of performance. If a trust has been registered elsewhere, registration in this state is ineffective until either the earlier registration is released by order of the court where prior registration occurred or an instrument executed by the trustee and all beneficiaries is filed with the registration in this state. ADD}
{ADD 18-1-2.2. Effect of filing . -- ADD} {ADD (a) By filing a trust, or accepting the trusteeship of a registered trust, the trustee submits personally to the jurisdiction of the court in any proceeding under this chapter relating to the trust that may be initiated by any interested person while the trust remains registered. Notice of any proceeding shall be delivered to the trustee, or mailed by ordinary first-class mail to the trustee's address as listed in the registration or as thereafter reported to the court and to the trustee's address as then known to the petitioner. ADD}
{ADD (b) To the extent of their interests in the trust, all beneficiaries of a trust properly registered in this state are subject to the jurisdiction of the court of registration for the purposes of proceedings under this chapter. ADD}
{ADD 18-1-2.3. Effect of failure to file. -- ADD} {ADD A trustee who fails to file a trust in a proper place as required by this chapter, for purposes of any proceedings initiated by a beneficiary of the trust before registration is subject to the personal jurisdiction of any court in which the trust could have been registered. In addition, any trustee who, within thirty (30) days after receipt of a written demand by a settlor or beneficiary of the trust, fails to register a trust as required by this chapter is subject to removal and denial of compensation or to surcharge as the court may direct. A provision in the terms of the trust purporting to excuse the trustee from the duty to register, or directing that the trust or trustee is not subject to the jurisdiction of the court, is ineffective. ADD}
{ADD 18-1-2.4. Filing -- Qualification of foreign trustee. -- ADD} {ADD A foreign corporation trustee is required to qualify as a foreign corporation doing business in this state if it maintains the principal place of administration of any trust within the state. A foreign co-trustee is not required to qualify in this state solely because its co-trustee maintains the principal place of administration in this state. Unless otherwise doing business in this state, local qualification by a foreign trustee, corporate or individual, is not required in order for the trustee to receive distribution from a local estate or to hold, invest in, manage or acquire property located in this state, or maintain litigation. Nothing in this section affects a determination of what other act require qualification as doing business in this state. ADD}
{ADD 18-1-2.5. Court jurisdiction. -- ADD} {ADD (a) The court has exclusive jurisdiction of proceedings initiated by interested parties concerning the internal affairs of trusts, including trusts covered by this section. Proceedings that may be maintained under this section are those concerning the administration and distribution of trusts, the declaration of rights, and the determination of other matters involving trustee and beneficiaries of trust. These include proceedings to: ADD}
{ADD (1) appoint or remove a trustee; ADD}
{ADD (2) review trustee's fees and to review and settle interim or final accounts; ADD}
{ADD (3) ascertain beneficiaries, determine any question arising in the administration or distribution of any trust including questions of construction of trust instruments, instruct trustees, and determine the existence or nonexistence of any immunity, power, privilege, duty, or right; and ADD}
{ADD (4) release registration of a trust. ADD}
{ADD (b) Neither registration of a trust nor a proceeding under this section results in continuing supervisory proceedings. The management and distribution of a trust estate, submission of accounts and reports to beneficiaries, payment of trustee's fees and other obligations of a trust, acceptance and change of trusteeship, and other aspects of the administration of a trust shall proceed expeditiously consistently with the terms of the trust, free of judicial intervention and without order, approval or other action of any court, subject to the jurisdiction of the court as invoked by interested parties or as otherwise exercised as provided by law. ADD}
{ADD (c) A provision that the laws of this state govern the validity, construction, and administration of the trust and that the trust is subject to the jurisdiction of this state is valid, effective, and conclusive for the trust if: ADD}
{ADD (1) some or all of the trust assets are deposited in this state and are being administered by a qualified person; in this paragraph, "deposited in this state" includes being held in a checking account, time deposit, certificate of deposit, brokerage account, trust company fiduciary account, or other similar account or deposit that is located in this state; ADD}
{ADD (2) a trustee is a qualified person who is designated as a trustee under the governing instrument or by a court having jurisdiction over the trust; ADD}
{ADD (3) the powers of the trustee identified under (2) of this subsection include or are limited to: ADD}
{ADD (A) maintaining records for the trust on an exclusive basis or a nonexclusive basis; and ADD}
{ADD (B) preparing or arranging for the preparation of, on an exclusive basis or a nonexclusive basis, an income tax return that must be filed by the trust; and ADD}
{ADD (4) part or all of the administration occurs in this state, including physically maintaining trust records in this state. ADD}
{ADD (d) The validity, construction, and administration of a trust with a state jurisdiction provision are determined by the laws of this state, including the: ADD}
{ADD (1) capacity of the settlor; ADD}
{ADD (2) powers, obligations, liabilities, and rights of the trustees and the appointment and removal of the trustees; and ADD}
{ADD (3) existence and extent of powers, conferred or retained, including a trustee's discretionary powers, the powers retained by a beneficiary of the trust, and the validity of the exercise of a power. ADD}
SECTION 3. This act shall take effect upon passage.
This act would change the existing fiduciary and trust law as presently required under state law. This act would require that a memorandum or summary of all trusts be filed in the land evidence records office of the place of administration. This act would also liberally construe and allow foreign trust to file more readily in the state.
This act would take effect upon passage.
