SB759,44,1211 701.0815 (3) A trustee has no power to give warranties in a sale, mortgage, or
12lease that are binding on the trustee personally.
SB759,108 13Section 108 . 701.0816 (29) of the statutes is created to read:
SB759,44,1514 701.0816 (29) Fund a trust or account that meets the requirements under 42
15USC 1396p
(d) (4) (A) or (C) for the benefit of an individual with a disability.
SB759,109 16Section 109 . 701.0816 (30) of the statutes is created to read:
SB759,44,1817 701.0816 (30) Fund an account that is part of an ABLE program under section
18529A of the Internal Revenue Code for a beneficiary's benefit.
SB759,110 19Section 110 . 701.0817 (3) (b) of the statutes is amended to read:
SB759,44,2220 701.0817 (3) (b) The beneficiary, at the time of the release, did not know of the
21beneficiary's rights or have a reasonable opportunity to know of the material facts
22relating to the breach.
SB759,111 23Section 111 . 701.0818 (2) (b) 2. h. of the statutes is repealed and recreated to
24read:
SB759,45,3
1701.0818 (2) (b) 2. h. Exercise a decanting power under subch. XIII or direct
2an authorized fiduciary, as defined in s. 701.1302 (1), to exercise a decanting power
3under subch. XIII.
SB759,112 4Section 112 . 701.1005 (1) of the statutes is amended to read:
SB759,45,105 701.1005 (1) A beneficiary may not commence a proceeding against a trustee
6for breach of trust more than one year after the earlier of either the date on which
7the beneficiary or a representative of the beneficiary waived the right to a report
8under s. 701.0813 (4) or the
date on which the beneficiary or a representative of the
9beneficiary was sent a report or other record that adequately disclosed the existence
10of a potential claim for breach of trust.
SB759,113 11Section 113 . 701.1005 (2) of the statutes is amended to read:
SB759,45,1512 701.1005 (2) A report or other record adequately discloses the existence of a
13potential claim for breach of trust if it provides sufficient information so that the
14beneficiary or representative knows of the potential claim or should have inquired
15into its existence.
SB759,114 16Section 114 . 701.1009 (2) of the statutes is amended to read:
SB759,45,1917 701.1009 (2) At the time of the consent, release, or ratification, the beneficiary
18did not have knowledge or a reasonable opportunity to obtain knowledge of the
19beneficiary's rights or of the material facts relating to the breach.
SB759,115 20Section 115 . 701.1105 (1) (b) of the statutes is amended to read:
SB759,45,2221 701.1105 (1) (b) Is given in the manner provided in ch. 879, except that notice
22by publication is not required
s. 701.0109.
SB759,116 23Section 116 . 701.1136 (1) of the statutes is amended to read:
SB759,46,424 701.1136 (1) Distribution of income. Except as otherwise determined by the
25trustee or a court under s. 701.1106 with respect to unitrust distributions, if a

1beneficiary is entitled to receive income from a trust, but the trust instrument fails
2to specify how frequently it is to be paid a current beneficiary is to receive income
3from the trust
, the trustee shall distribute at least annually the income to which such
4the current beneficiary is entitled at least annually.
SB759,117 5Section 117 . Subchapter XIII of chapter 701 [precedes 701.1301] of the
6statutes is created to read:
SB759,46,77 CHAPTER 701
SB759,46,98 SUBCHAPTER XIII
9 Uniform trust decanting act
SB759,46,11 10701.1301 Short title. This subchapter may be cited as the Uniform Trust
11Decanting Act.
SB759,46,12 12701.1302 Definitions. In this subchapter:
SB759,46,13 13(1) “Authorized fiduciary” means any of the following:
SB759,46,1614 (a) A trustee, a directing party, or another fiduciary, other than a settlor, that
15has discretion to distribute or direct a trustee to distribute part or all of the principal
16of the first trust to one or more current beneficiaries.
SB759,46,1717 (b) A special fiduciary appointed under s. 701.1309.
SB759,46,1818 (c) A special-needs fiduciary under s. 701.1313.
SB759,46,2019 (d) A trust protector who has been granted a decanting power, which may be
20exercised in a fiduciary or nonfiduciary capacity, under s. 701.0818 (2) (b) 2. h.
SB759,46,23 21(2) “Decanting power” means the power of an authorized fiduciary under this
22subchapter to distribute property of a first trust to one or more 2nd trusts or to modify
23the terms of the first trust.
SB759,47,3
1(3) “Expanded distributive discretion” means a discretionary power of
2distribution that is not limited to an ascertainable standard or a reasonably definite
3standard.
SB759,47,5 4(4) “First trust” means a trust over which an authorized fiduciary may exercise
5the decanting power.
SB759,47,6 6(5) “First-trust instrument” means the trust instrument for a first trust.
SB759,47,10 7(6) “Reasonably definite standard” means a clearly measurable standard
8under which a holder of a power of distribution is legally accountable within the
9meaning of section 674 (b) (5) (A) of the Internal Revenue Code and any applicable
10regulations.
SB759,47,11 11(7) “Second trust” means any of the following:
SB759,47,1212 (a) A first trust after modification under this subchapter.
SB759,47,1413 (b) A trust to which a distribution of property from a first trust is or may be
14made under this subchapter.
SB759,47,15 15(8) “Second-trust instrument” means the trust instrument for a 2nd trust.
SB759,47,18 16701.1303 Scope. (1) Except as otherwise provided in subs. (2) and (3), this
17subchapter applies to an express trust that is irrevocable or revocable by the settlor
18only with the consent of the trustee or a person holding an adverse interest.
SB759,47,19 19(2) This subchapter does not apply to a trust held solely for charitable purposes.
SB759,47,21 20(3) Subject to s. 701.1315, a trust instrument may restrict or prohibit exercise
21of the decanting power.
SB759,47,25 22(4) This subchapter does not limit the power of an authorized fiduciary or other
23person to distribute or appoint property in further trust or to modify a trust under
24the trust instrument, law of this state other than this subchapter, common law, a
25court order, or a nonjudicial settlement agreement.
SB759,48,3
1(5) This subchapter does not affect the ability of a settlor to provide in a trust
2instrument for the distribution of the trust property or appointment in further trust
3of the trust property or for modification of the trust instrument.
SB759,48,11 4701.1304 Fiduciary duty. (1) In exercising the decanting power, an
5authorized fiduciary shall act in accordance with its fiduciary duties, including the
6duty to act in accordance with the purposes of the first trust. If a trustee or other
7authorized fiduciary is directed by another authorized fiduciary to exercise the
8decanting power, the trustee or other directed authorized fiduciary shall act to
9comply with the exercise of the decanting power and the trustee or other directed
10authorized fiduciary shall not be liable for the action regardless of any fiduciary duty
11that the trustee or other directed authorized fiduciary might otherwise have.
SB759,48,13 12(2) This subchapter does not create or imply a duty to exercise the decanting
13power or to inform beneficiaries about the applicability of this subchapter.
SB759,48,16 14(3) Except as otherwise provided in a first-trust instrument, for purposes of
15this subchapter and ss. 701.0801 and 701.0802 (2), the terms of the first trust are
16deemed to include the decanting power.
SB759,48,19 17701.1305 Application; governing law. This subchapter applies to a trust
18created before, on, or after the effective date of this section .... [LRB inserts date], if
19any of the following applies:
SB759,48,21 20(1) The trust has its principal place of administration in this state, including
21a trust whose principal place of administration has been changed to this state.
SB759,48,23 22(2) The trust provides by its trust instrument that it is governed by the law of
23this state or is governed by the law of this state for the purpose of any of the following:
SB759,48,2524 (a) Administration, including administration of a trust whose governing law
25for purposes of administration has been changed to the law of this state.
SB759,49,1
1(b) Construction of terms of the trust.
SB759,49,22 (c) Determining the meaning or effect of terms of the trust.
SB759,49,7 3701.1306 Reasonable reliance. A trustee or other person that reasonably
4relies on the validity of a distribution of part or all of the property of a trust to another
5trust, or a modification of a trust, under this subchapter, law of this state other than
6this subchapter, or the law of another jurisdiction is not liable to any person for any
7action or failure to act as a result of the reliance.
SB759,49,10 8701.1307 Notice; exercise of decanting power. (1) In this section, a notice
9period begins on the day notice is given under sub. (3) and ends 30 days after the day
10notice is given.
SB759,49,13 11(2) Except as otherwise provided in this subchapter, an authorized fiduciary
12may exercise the decanting power without the consent of any person and without
13court approval.
SB759,49,16 14(3) Except as otherwise provided in sub. (6), an authorized fiduciary shall give
15notice of the intended exercise of the decanting power not later than 30 days before
16the exercise to all of the following:
SB759,49,1717 (a) Each settlor of the first trust, if living or then in existence.
SB759,49,1818 (b) Each qualified beneficiary of the first trust.
SB759,49,2019 (c) Each holder of a presently exercisable power of appointment over any part
20or all of the first trust.
SB759,49,2221 (d) Each person that currently has the right to remove or replace the authorized
22fiduciary.
SB759,49,2323 (e) Each directing party, trust protector, or other fiduciary of the first trust.
SB759,49,2424 (f) Each directing party, trust protector, or other fiduciary of the 2nd trust.
SB759,49,2525 (g) If s. 701.1314 (2) applies, the attorney general.
SB759,50,3
1(4) An authorized fiduciary is not required to give notice under sub. (3) to a
2person that is not known to the fiduciary or is known to the fiduciary but cannot be
3located by the fiduciary after reasonable diligence.
SB759,50,4 4(5) A notice under sub. (3) must do all of the following:
SB759,50,65 (a) Specify the manner in which the authorized fiduciary intends to exercise
6the decanting power.
SB759,50,77 (b) Specify the proposed effective date for exercise of the power.
SB759,50,88 (c) Include a copy of the first-trust instrument.
SB759,50,99 (d) Include a copy of all 2nd-trust instruments.
SB759,50,12 10(6) The decanting power may be exercised before expiration of the notice period
11under sub. (1) if all persons entitled to receive notice waive the period in a signed
12record.
SB759,50,15 13(7) The receipt of notice, waiver of the notice period, or expiration of the notice
14period does not affect the right of a person to file an application under s. 701.1309
15asserting any of the following:
SB759,50,1816 (a) That an attempted exercise of the decanting power is ineffective because it
17did not comply with this subchapter or was an abuse of discretion or breach of
18fiduciary duty.
SB759,50,1919 (b) That s. 701.1322 applies to the exercise of the decanting power.
SB759,50,22 20(8) An exercise of the decanting power is not ineffective because of the failure
21to give notice to one or more persons under sub. (3) if the authorized fiduciary acted
22with reasonable care to comply with sub. (3).
SB759,51,2 23701.1309 Court involvement. (1) On application of an authorized fiduciary,
24a person entitled to notice under s. 701.1307 (3), a beneficiary, or with respect to a

1charitable interest the attorney general or other person that has standing to enforce
2the charitable interest, the court may do any of the following:
SB759,51,53 (a) Provide instructions to the authorized fiduciary regarding whether a
4proposed exercise of the decanting power is permitted under this subchapter and
5consistent with the fiduciary duties of the authorized fiduciary.
SB759,51,86 (b) Appoint a special fiduciary and authorize the special fiduciary to determine
7whether the decanting power should be exercised under this subchapter and to
8exercise the decanting power.
SB759,51,99 (c) Approve an exercise of the decanting power.
SB759,51,1110 (d) Determine that a proposed or attempted exercise of the decanting power is
11ineffective for any of the following reasons:
SB759,51,1312 1. After applying s. 701.1322, the proposed or attempted exercise does not or
13did not comply with this subchapter.
SB759,51,1514 2. The proposed or attempted exercise would be or was an abuse of the
15fiduciary's discretion or a breach of fiduciary duty.
SB759,51,1716 3. The proposed or attempted exercise is expressly prohibited under the terms
17of the first trust.
SB759,51,1918 (e) Determine the extent to which s. 701.1322 applies to a prior exercise of the
19decanting power.
SB759,51,2120 (f) Provide instructions to the trustee regarding the application of s. 701.1322
21to a prior exercise of the decanting power.
SB759,51,2222 (g) Order other relief to carry out the purposes of this subchapter.
SB759,51,24 23(2) On application of an authorized fiduciary, the court may approve any of the
24following:
SB759,51,2525 (a) An increase in the fiduciary's compensation under s. 701.1316.
SB759,52,2
1(b) A modification under s. 701.1318 of a provision granting a person the right
2to remove or replace the fiduciary.
SB759,52,7 3701.1310 Formalities. An exercise of the decanting power must be made in
4a record signed by an authorized fiduciary. The signed record must, directly or by
5reference to the notice required by s. 701.1307, identify the first trust and the 2nd
6trust or trusts and state the property of the first trust being distributed to each 2nd
7trust and the property, if any, that remains in the first trust.
Loading...
Loading...