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CHAPTER 702
POWERS OF APPOINTMENT
702.01   Definitions.
702.02   Definitions.
702.03   Manifestation of intent to exercise a power of appointment.
702.05   Exercise of a power of appointment.
702.07   Power of appointment to be construed as exclusive.
702.08   Disclaimer of a power of appointment.
702.09   Release of a power of appointment.
702.11   Irrevocability of creation, exercise and release of a power of appointment.
702.13   Recording instruments relating to a power of appointment.
702.15   Disposition when a special power of appointment is unexercised.
702.17   Rights of creditors of the donee.
702.19   Matters governed by common law.
702.21   Applicability of chapter.
702.22   Applicability of general transfers at death provisions.
702.01 702.01 Definitions. As used in this chapter, unless the context indicates otherwise:
Effective date note NOTE: Section 702.01 (title) and (intro.) are renumbered to s. 702.02 (title) and (intro.) eff. 7-1-14 by 2013 Wis. Act 92.
702.01(1) (1) "Creating instrument" means the will, trust agreement or other document which creates or reserves the power.
Effective date note NOTE: Sub. (1) is renumbered to s. 702.02 (2) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.01(2) (2) "Donor" means the person who creates or reserves the power; "donee" means the person in whom the power is created or reserved; and "appointee" means the person to whom an interest is appointed.
Effective date note NOTE: Sub. (2) is renumbered to s. 702.02 (4) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.01(3) (3) "General power" means a power exercisable in favor of the donee, the donee's estate, the donee's creditors or the creditors of the donee's estate, whether or not it is exercisable in favor of others. A power to appoint to any person or a power which is not expressly restricted as to appointees may be exercised in favor of the donee or the donee's creditors if exercisable during lifetime, and in favor of the donee's estate or the creditors of the donee's estate if exercisable by will.
Effective date note NOTE: Sub. (3) is renumbered to s. 702.02 (5) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.01(4) (4) "Power" means a power of appointment over legal or equitable interests in real or personal property. A power of appointment is a power created or reserved by a person having property subject to his or her disposition which enables the donee of the power to designate, within such limits as may be prescribed, the transferees of the property or the shares or the interests in which it shall be received; it does not include a power of sale, a power of attorney, a power of revocation or a power exercisable by a trustee or other fiduciary in his or her fiduciary capacity.
Effective date note NOTE: Sub. (4) is renumbered to s. 702.02 (6) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.01(5) (5) "Special power" means a power exercisable only in favor of one or more persons not including the donee, the donee's estate, the donee's creditors or the creditors of the donee's estate and, when exercisable in favor of a class, so limited in size by description of the class that in the event of nonexercise of the power a court can make distribution to persons within the class if the donor has failed to provide for this contingency.
Effective date note NOTE: Sub. (5) is renumbered to s. 702.02 (7) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.01(6) (6) "Unclassified power" means a power which is neither a general power nor a special power as defined in this section.
Effective date note NOTE: Sub. (6) is repealed eff. 7-1-14 by 2013 Wis. Act 92.
702.01 History History: 1971 c. 66; 1983 a. 189; 1993 a. 486; 2013 a. 92.
702.02 702.02 Definitions. As used in this chapter, unless the context indicates otherwise:
Effective date note NOTE: Section 702.02 (title) and (intro.) are shown as renumbered from s. 702.01 (title) and (intro.) eff. 7-1-14 by 2013 Wis. Act 92.
702.02(1) (1) "Appointee" means the person to whom an interest is appointed.
Effective date note NOTE: Sub. (1) is created eff. 7-1-14 by 2013 Wis. Act 92.
702.02(2) (2) "Creating instrument" means the will, trust agreement, or other document which creates or reserves the power of appointment.
Effective date note NOTE: Sub. (2) is shown as renumbered from s. 702.01 (1) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.02(3) (3) "Donee" means the person in whom the power of appointment is created or reserved.
Effective date note NOTE: Sub. (3) is created eff. 7-1-14 by 2013 Wis. Act 92.
702.02(4) (4) "Donor" means the person who creates or reserves the power of appointment.
Effective date note NOTE: Sub. (4) is shown as renumbered from s. 702.01 (2) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.02(5) (5) "General power of appointment" means a power exercisable in favor of the donee, the donee's estate, the donee's creditors, or the creditors of the donee's estate, whether or not it is also exercisable in favor of others. A power to appoint to any person or a power of appointment that is not expressly restricted as to appointees may be exercised in favor of the donee or the donee's creditors if exercisable during lifetime, and in favor of the donee's estate or the creditors of the donee's estate if exercisable by will.
Effective date note NOTE: Sub. (5) is shown as renumbered from s. 702.01 (3) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.02(6) (6) "Power of appointment" means a power to appoint legal or equitable interests in real or personal property. A power of appointment is created or reserved by a person having property subject to his or her disposition which enables the donee of the power of appointment to designate, within such limits as may be prescribed, the transferees of the property or the shares or the interests in which it shall be received. A power of appointment does not include a power of sale, a power of attorney, a power of revocation, or a power exercisable by a trustee, a directing party, as defined in s. 701.0103 (7), another fiduciary in his or her fiduciary capacity, or a trust protector, as defined in s. 701.0103 (31).
Effective date note NOTE: Sub. (6) is shown as renumbered from s. 702.01 (4) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.02(7) (7) "Special power of appointment" means a power of appointment that is not a general power of appointment.
Effective date note NOTE: Sub. (7) is shown as renumbered from s. 702.01 (5) and amended eff. 7-1-14 by 2013 Wis. Act 92.
702.02 History History: 1971 c. 66; 1983 a. 189; 1993 a. 486; 2013 a. 92 ss. 302 to 310; Stats. 2013 s. 702.02.
702.03 702.03 Manifestation of intent to exercise a power of appointment.
702.03(1)(1) Unless the person who executed it had a contrary intention, if a creating instrument creates a power of appointment that expressly requires that the power of appointment be exercised by any type of reference to the power of appointment or its source, the donor's intention in requiring the reference is presumed to be to prevent an inadvertent exercise of the power of appointment. Extrinsic evidence, as defined in s. 854.01 (1), may be used to construe the intent.
702.03(2) (2) In the case of other powers of appointment, a creating instrument manifests an intent to exercise the power of appointment if the creating instrument purports to transfer an interest in the appointive property which the donee would have no power to transfer except by virtue of the power of appointment, even though the power of appointment is not recited or referred to in the creating instrument, or if the creating instrument either expressly or by necessary implication from its wording interpreted in light of the circumstances surrounding its drafting and execution manifests an intent to exercise the power of appointment. If there is a general power of appointment exercisable by will with no gift in default in the creating instrument, a residuary clause or other general language in the donee's will purporting to dispose of all of the donee's estate or property operates to exercise the power of appointment in favor of the donee's estate, but in all other cases such a clause or language does not in itself manifest an intent to exercise a power of appointment exercisable by will.
Effective date note NOTE: This section is shown as amended eff. 7-1-14 by 2013 Wis. Act 92. Prior to 7-1-14 it reads:
Effective date text 702.03Manifestation of intent to exercise powers. (1) Unless the person who executed it had a contrary intention, if a governing instrument, as defined in s. 854.01 (2), or an inter vivos governing instrument, as defined in s. 700.27 (1) (c), creates a power of appointment that expressly requires that the power be exercised by any type of reference to the power or its source, the donor's intention in requiring the reference is presumed to be to prevent an inadvertent exercise of the power. Extrinsic evidence, as defined in s. 854.01 (1), may be used to construe the intent.
Effective date text (2) In the case of other powers, an instrument manifests an intent to exercise the power if the instrument purports to transfer an interest in the appointive property which the donee would have no power to transfer except by virtue of the power, even though the power is not recited or referred to in the instrument, or if the instrument either expressly or by necessary implication from its wording interpreted in light of the circumstances surrounding its drafting and execution manifests an intent to exercise the power. If there is a general power exercisable by will with no gift in default in the creating instrument, a residuary clause or other general language in the donee's will purporting to dispose of all of the donee's estate or property operates to exercise the power in favor of the donee's estate, but in all other cases such a clause or language does not in itself manifest an intent to exercise a power exercisable by will.
702.03 History History: 1997 a. 188; 2005 a. 216; 2013 a. 92.
702.03 Annotation Under the prior version of sub. (1) an executing instrument was required to contain both a specific reference to the power and expressly manifest an intent to exercise the power or transfer property. The current version recognizes that a specific power of appointment requirement creates a presumption that the specific reference was intended to prevent inadvertent exercise. This presumption can be overcome if it can be demonstrated that the donee had knowledge of and intended to exercise the power. Czaplewski v. Shepherd, 2012 WI App 116, 344 Wis. 2d 440, 823 N.W.2d 523, 11-2521.
702.05 702.05 Exercise of a power of appointment.
702.05(1) (1) Capacity to exercise a power of appointment. A power of appointment can be exercised only by a person who would have the capacity to transfer the property covered by the power of appointment.
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2011-12 Wisconsin Statutes updated though 2013 Wis. Act 324 and all Supreme Court Orders entered before April 25, 2014. Published and certified under s. 35.18. Changes effective after April 25, 2014 are designated by NOTES. (Published 4-25-14)