HB 334

Abstract

Section 1 of the Act addresses statutes under Chapter 33 of Title 12 and (i) amends section 3330 by adding subsections (c) and (d)—to make explicit in subsection (a) of section 3330 the applicability dates that were intended to be carried over from the applicability dates of the pre-2018 version of section 213 of Title 12 when, in 2018, section 213 was re-codified as subsection (a) of section 3330, and to provide a corresponding clarification of the applicability dates of subsection (b) of section 3330; (ii) amends section 3338 to specify that, consistent with the Uniform Trust Code, when a trustor is a party to a nonjudicial settlement agreement, then unless the transfer in trust is an incomplete gift for federal gift tax purposes, the trustor may not represent and bind any beneficiary other than the trustor, and—if the nonjudicial settlement agreement alters any beneficial interest in the trust—all of the trust’s beneficiaries must be parties to the agreement; (iii) amends section 3342 to parallel the changes to section 3338 under this Act—that is, to specify that, consistent with the Uniform Trust Code, unless the transfer in trust is an incomplete gift for federal gift tax purposes, a trustor, a guardian of a trustor, or an agent of a trustor under a power of attorney may not represent and bind any beneficiary other than the trustor with respect to a modification under section 3342, and to make it more clear that all of the trust’s beneficiaries must be parties to the modification; and (iv) amends the provisions of section 3343, to make subsection (a) more clear, to make section 3343’s provisions with respect to section 3313A more clear, to add within new subsection (c)(2) of section 3343 a provision allowing a trustee now excluded from exercising certain powers to be released with respect to the past exercise of such powers as though such trustee were being removed, and by adding a provision to section 3343 that an existing trustee is entitled to 30 days’ notice before changes under section 3343 become effective with respect to the existing trustee’s duties, unless the existing trustee waives the notice period. Section 2 of the Act addresses statutes under Chapter 35 of Title 12 and (i) removes a superfluous word in section 3528; and (ii) amends subsection (a)(2) of section 3585 to make it clear that the report procedure described in that subsection may be used while the trustee is in the process of resigning (and not just after completion of the act of resignation or the effective date of a resignation)—but also conditions the use of the procedure upon the resigning or resigned trustee’s transferring assets to the appropriate successor in interest within a reasonable period of time after expiration of the period within which interested parties may file an action against the trustee under subsection (a)(2), and further provides in subsection (e) that certain actions are not barred against a trustee for administration of assets after the expiration of periods under section 3585. Section 3 of the Act amends Chapter 47 of Title 12 (the Uniform Prudent Management of Institutional Funds Act) to make it clear within section 4703 that sustainable investment strategies aligning with the charitable purposes of the institution are authorized in managing the institution’s funds (thereby corresponding to recent similar amendments to sections 3302 and 3303 of Title 12). Section 4 of the Act provides effective dates.