SB384: Bill Text

SB384,96,21 (6) (a) A directing party may request information about the trust from the trustee and, if the requested information is related to a power granted to the directing party, the trustee shall provide the requested information to the directing party. If a trustee is bound by any confidentiality restrictions with respect to information requested by a directing party, the trustee may require that the directing party agree to be bound by the confidentiality restrictions before delivering such information to the directing party. A trustee is not liable to any beneficiary for any loss or damages resulting from the trustee providing information to the directing party that is related to the power granted to the directing party.

SB384,96,24 (b) Except as otherwise provided in this chapter, a trustee does not have a duty to provide any information to the directing party that the directing party does not request.

SB384,97,3 (7)   Payment or reimbursement of attorney fees and costs. A trustee shall, in accordance with s. 701.1004, pay or reimburse a directing party for attorney fees and costs to defend any claim made against the directing party.

SB384,97,5 (8) Sections 701.0701, 701.0708, 701.0709, 701.1001 to 701.1003, and 701.1005 to 701.1010 apply to a directing party as if the directing party was a trustee.

SB384,97,7 (9) A person who accepts an appointment as a directing party of a trust submits to the jurisdiction of the courts of this state, as provided in s. 701.0202 (1).

SB384,142 Section 142. 701.0809 of the statutes is created to read:

SB384,97,10 701.0809 Control and protection of trust property. A trustee shall take reasonable steps to take control of and protect the trust property.

SB384,143 Section 143. 701.0810 of the statutes is created to read:

SB384,97,13 701.0810 Record keeping and identification of trust property. (1) A trustee shall keep adequate records of the administration of the trust.

SB384,97,15 (2) A trustee shall keep trust property separate from the trustee's own property.

SB384,97,18 (3) Except as otherwise provided in sub. (4), a trustee shall cause the trust property to be designated so that the interest of the trust, to the extent feasible, appears in records maintained by a party other than a trustee or beneficiary.

SB384,97,20 (4) If the trustee maintains records clearly indicating the respective interests, a trustee may invest as a whole the property of 2 or more separate trusts.

SB384,144 Section 144. 701.0811 of the statutes is created to read:

SB384,97,24 701.0811 Enforcement and defense of claims. A trustee shall take reasonable steps to enforce claims of the trust known to the trustee and to defend claims against the trust known to the trustee.

SB384,145 Section 145. 701.0812 of the statutes is created to read:

SB384,98,5 701.0812 Collecting trust property; duties of successor trustees. (1) A trustee shall take reasonable steps to compel a former trustee or other person to deliver trust property to the trustee, and to redress a breach of trust known to the trustee to have been committed by a trustee or former trustee, or a trust protector or former trust protector.

SB384,98,7 (2) A successor trustee does not have a duty to examine the accounts of a former trustee.

SB384,146 Section 146. 701.0813 of the statutes is created to read:

SB384,98,14 701.0813 Duty to inform and report. (1) A trustee shall keep the distributees or permissible distributees of trust income or principal, and other qualified beneficiaries who so request, reasonably informed about the administration of the trust. Unless unreasonable under the circumstances, a trustee shall promptly respond to a qualified beneficiary's request for information related to the administration of the trust.

SB384,98,15 (2) A trustee shall do all of the following:

SB384,98,19 (a) Upon the request of a qualified beneficiary for a copy of the trust instrument, promptly furnish to the qualified beneficiary either a copy of the portions of the trust instrument relating to the interest of the qualified beneficiary or a copy of the trust instrument.

SB384,98,22 (b) Within a reasonable period of time after accepting a trusteeship, notify the qualified beneficiaries of the acceptance and of the trustee's name, address, and telephone number.

SB384,99,2 (c) Within a reasonable period of time after the date on which the trustee acquires knowledge of the creation of an irrevocable trust, or the date on which the trustee acquires knowledge that a formerly revocable trust has become irrevocable, whether by the death of the settlor or otherwise, notify the qualified beneficiaries of all of the following:

SB384,99,3 1. The trust's existence.

SB384,99,4 2. The identity of the settlor or settlors.

SB384,99,6 3. The name, address, and telephone number of each directing party and trust protector.

SB384,99,7 4. The right to request a copy of the documentation referred to in par. (a).

SB384,99,8 5. The right to request information under sub. (1).

SB384,99,9 6. The right to a trustee's report as provided in sub. (3).

SB384,99,12 (d) Notify the distributees or permissible distributees of trust income or principal, and other qualified beneficiaries who so request, of any change in the method or rate of the trustee's compensation.

SB384,99,17 (e) Upon receiving a petition to the court for action under ss. 701.0411 to 701.0416 that does not identify each trust protector and each directing party of the trust, notify the petitioning party of the identity of each trust protector and directing party, including the name, address, and telephone number of each trust protector and directing party, who is serving at the time the petition is filed.

SB384,99,20 (3) (a) At least annually and upon the termination of a trust, a trustee shall send to the distributees or permissible distributees of trust income or principal, and to other qualified beneficiaries who request it, all of the following:

SB384,99,22 1. A report of the trust property, liabilities, receipts, and disbursements, including the source and amount of the trustee's compensation.

SB384,99,23 2. A listing of the trust assets and, if feasible, their respective market values.

SB384,99,25 (b) Upon a vacancy in a trusteeship, unless a cotrustee remains in office, the former trustee shall send a report containing the information described under par. (a) 1. to the qualified beneficiaries. A personal representative or guardian may send the qualified beneficiaries a report containing the information described in par. (a) 1. on behalf of a deceased or incapacitated trustee.

SB384,100,7 (4) A qualified beneficiary may waive the right to a trustee's report or other information otherwise required to be furnished under this section. A qualified beneficiary, with respect to future reports and other information, may withdraw a waiver previously given.

SB384,100,12 (5) Subsections (2) (b) and (c) and (3) do not apply to a trustee who accepts a trusteeship before the effective date of this subsection .... [LRB inserts date], to an irrevocable trust created before the effective date of this subsection .... [LRB inserts date], or to a revocable trust that becomes irrevocable before the effective date of this subsection .... [LRB inserts date].

SB384,147 Section 147. 701.0814 of the statutes is created to read:

SB384,100,20 701.0814 Discretionary powers; tax savings. (1) Notwithstanding the breadth of discretion granted to a trustee in the terms of the trust, including the use of such terms as "absolute," "sole," or "uncontrolled," the trustee shall exercise a discretionary power in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries. A court may not determine that a trustee abused its discretion merely because the court would have exercised the discretion in a different manner or would not have exercised the discretion.

SB384,100,22 (2) Subject to sub. (4), and unless the terms of the trust expressly indicate that a provision of this subsection does not apply, all of the following apply:

SB384,101,2 (a) A person other than a settlor who is a beneficiary and a trustee, directing party, or trust protector of a trust that confers on the trustee, directing party, or trust protector a power to make discretionary distributions to or for the trustee's, directing party's, or trust protector's personal benefit may exercise the power only in accordance with an ascertainable standard.

SB384,101,5 (b) A trustee, directing party, or trust protector may not exercise a power to make discretionary distributions to satisfy a legal obligation of support that the trustee, directing party, or trust protector personally owes another person.

SB384,101,10 (3) A power whose exercise is limited or prohibited by sub. (2) may be exercised by a majority of the remaining trustees, directing parties, or trust protectors whose exercise of the power is not so limited or prohibited. If the power of all trustees, directing parties, or trust protectors is so limited or prohibited, the court may appoint a trustee, directing party, or trust protector with authority to exercise the power.

SB384,101,11 (4) Subsection (2) does not apply to any of the following:

SB384,101,14 (a) A power held by the settlor's spouse who is the trustee, directing party, or trust protector of a trust for which a marital deduction, as defined in section 2056 (b) (5) or 2523 (e) of the Internal Revenue Code, was previously allowed.

SB384,101,16 (b) A trust during a period when the trust may be revoked or amended by its settlor.

SB384,101,18 (c) A trust if contributions to the trust qualify for the annual exclusion under section 2503 (c) of the Internal Revenue Code.

SB384,148 Section 148. 701.0815 of the statutes is created to read:

SB384,101,21 701.0815 General powers of trustee. (1) A trustee, without authorization by the court, may exercise the following powers:

SB384,101,22 (a) Powers conferred by the terms of the trust.

SB384,101,23 (b) Except as limited by the terms of the trust, all of the following powers:

SB384,101,25 1. All powers over the trust property that an unmarried, competent owner has over individually owned property.

SB384,102,2 2. Any other powers appropriate to achieve the proper investment, management, and distribution of the trust property.

SB384,102,3 3. Any other powers conferred by this chapter.

SB384,102,5 (2) The exercise of a power is subject to the fiduciary duties prescribed by this chapter.

SB384,149 Section 149. 701.0816 of the statutes is created to read:

SB384,102,8 701.0816 Specific powers of trustee. Without limiting the authority conferred by s. 701.0815, a trustee may do all of the following:

SB384,102,10 (1) Collect trust property and accept or reject additions to the trust property from a settlor or any other person.

SB384,102,11 (2) Acquire or sell property, for cash or on credit, at public or private sale.

SB384,102,12 (3) Exchange, partition, or otherwise change the character of trust property.

SB384,102,14 (4) Deposit trust money in an account in a regulated financial-service institution.

SB384,102,16 (5) Borrow money, with or without security, and mortgage or pledge trust property for a period within or extending beyond the duration of the trust.

SB384,102,22 (6) With respect to an interest in a proprietorship, partnership, limited liability company, business trust, corporation, or other form of business or enterprise, continue the business or other enterprise and take any action that may be taken by shareholders, members, or property owners, including merging, dissolving, or otherwise changing the form of business organization or contributing additional capital.

SB384,102,24 (7) With respect to a stock or other security, exercise the rights of an absolute owner, including the right to do any of the following:

SB384,103,2 (a) Vote, or give proxies to vote, with or without power of substitution, or enter into or continue a voting trust agreement.

SB384,103,4 (b) Hold a stock or other security in the name of a nominee or in other form without disclosure of the trust so that title may pass by delivery.

SB384,103,6 (c) Pay calls, assessments, and other sums chargeable or accruing against the stock or other security, and sell or exercise stock subscription or conversion rights.

SB384,103,8 (d) Deposit the stock or other security with a depository or other regulated financial-service institution.

SB384,103,13 (8) With respect to an interest in real property, construct, or make ordinary or extraordinary repairs to, alterations to, or improvements in, buildings or other structures, demolish improvements, raze existing or erect new party walls or buildings, subdivide or develop land, dedicate land to public use or grant public or private easements, and make or vacate plats and adjust boundaries.

SB384,103,17 (9) Enter into a lease for any purpose as lessor or lessee, including a lease or other arrangement for exploration and removal of natural resources, with or without the option to purchase or renew, for a period within or extending beyond the duration of the trust.

SB384,103,20 (10) Grant an option involving a sale, lease, or other disposition of trust property or acquire an option for the acquisition of property, including an option exercisable beyond the duration of the trust, and exercise an option so acquired.

SB384,103,23 (11) Insure the property of the trust against damage or loss and insure the trustee, the trustee's agents, any directing party, any trust protector, and the beneficiaries against liability arising from the administration of the trust.

SB384,103,25 (12) Abandon or decline to administer property of no value or of insufficient value to justify its collection or continued administration.

SB384,104,2 (13) With respect to possible liability for violation of environmental law, do any of the following:

SB384,104,6 (a) Inspect or investigate property the trustee holds or has been asked to hold, or property owned or operated by an organization in which the trustee holds or has been asked to hold an interest, for the purpose of determining the application of environmental law with respect to the property.

SB384,104,10 (b) Take action to prevent, abate, or otherwise remedy any actual or potential violation of any environmental law affecting property held directly or indirectly by the trustee, whether taken before or after the assertion of a claim or the initiation of governmental enforcement.

SB384,104,12 (c) Decline to accept property into trust or disclaim any power with respect to property that is or may be burdened with liability for violation of environmental law.

SB384,104,14 (d) Compromise claims against the trust that may be asserted for an alleged violation of environmental law.

SB384,104,16 (e) Pay the expense of any inspection, review, abatement, or remedial action to comply with environmental law.

SB384,104,18 (14) Pay or contest any claim, settle a claim by or against the trust, and release, in whole or in part, a claim belonging to the trust.

SB384,104,21 (15) Pay taxes; assessments; compensation of the trustee, a directing party, a trust protector, and employees and agents of the trust; and other expenses incurred in the administration of the trust.

SB384,104,22 (16) Exercise elections with respect to federal, state, and local taxes.

SB384,105,2 (17) Select a mode of payment under any employee benefit or retirement plan, annuity, or life insurance payable to the trustee, exercise rights thereunder, including exercise of the right to indemnification for expenses and against liabilities, and take appropriate action to collect the proceeds.

SB384,105,6 (18) Make loans out of trust property, including loans to a beneficiary on terms and conditions the trustee considers to be fair and reasonable under the circumstances. The trustee has a lien on future distributions for repayment of loans under this subsection.

SB384,105,7 (19) Pledge trust property to guarantee loans made by others to the beneficiary.

SB384,105,11 (20) Appoint a trustee to act in another jurisdiction with respect to trust property located in the other jurisdiction, confer upon the appointed trustee all of the powers and duties of the appointing trustee, require that the appointed trustee furnish security, and remove any trustee so appointed.

SB384,105,15 (21) Pay an amount distributable to a beneficiary who is under a legal disability or who the trustee reasonably believes is incapacitated, by paying it directly to the beneficiary, applying it for the beneficiary's benefit, or by doing any of the following:

SB384,105,17 (a) Paying the amount to the beneficiary's conservator or the beneficiary's guardian of the estate.

SB384,105,21 (b) Paying the amount to the beneficiary's custodian under the Uniform Transfers to Minors Act under ss. 54.854 to 54.898 or the Uniform Custodial Trust Act under ss. 54.950 to 54.988, and, for that purpose, creating a custodianship or custodial trust.