Bill Text: CA AB1683 | 2011-2012 | Regular Session | Chaptered
Bill Title: Revocable trusts.
Spectrum: Slight Partisan Bill (Republican 2-1)
Status: (Passed) 2012-07-09 - Chaptered by Secretary of State - Chapter 55, Statutes of 2012. [AB1683 Detail]
Download: California-2011-AB1683-Chaptered.html
BILL NUMBER: AB 1683 CHAPTERED
BILL TEXT
CHAPTER 55
FILED WITH SECRETARY OF STATE JULY 9, 2012
APPROVED BY GOVERNOR JULY 9, 2012
PASSED THE SENATE JUNE 18, 2012
PASSED THE ASSEMBLY MARCH 29, 2012
AMENDED IN ASSEMBLY MARCH 22, 2012
AMENDED IN ASSEMBLY MARCH 13, 2012
INTRODUCED BY Assembly Member Hagman
(Coauthors: Assembly Members Jeffries and Wieckowski)
FEBRUARY 14, 2012
An act to amend Sections 15401 and 15410 of the Probate Code,
relating to trusts.
LEGISLATIVE COUNSEL'S DIGEST
AB 1683, Hagman. Revocable trusts.
Under existing law, a trust that is revocable by the settlor may
be revoked in whole or in part by either compliance with any method
of revocation provided in the trust instrument or by a writing, other
than a will, signed by the settlor and delivered to the trustee
during the settlor's lifetime, as specified.
This bill would also allow revocation of a trust to be made by a
writing signed by any other person holding the power of revocation
and delivered to the trustee during the lifetime of the settlor or
the person holding the power of revocation.
Under existing law, if a trust is created by more than one
settlor, each settlor may revoke the trust as to the portion of the
trust contributed by that settlor, unless the trust instrument
provides otherwise and except with respect to certain community
property interests.
This bill would, notwithstanding these provisions, specify that a
settlor may grant to another person, including his or her spouse, a
power to revoke all or part of that portion of the trust contributed
by that settlor, regardless of whether that portion was separate
property or community property of that settlor, and regardless of
whether that power to revoke is exercisable during the lifetime of
that settlor or continues after the death of that settlor, or both.
Existing law establishes procedures governing the disposal of
property when a trust is terminated. Under existing law, if a trust
is revoked by the settlor, then the trust property is disposed of
according to the directions of the settlor.
This bill would instead specify that if a trust is revoked by the
settlor, the trust property would be disposed of first as directed by
the settlor, secondly, as provided in the trust instrument, and to
the extent there is no direction by the settlor or in the trust
instrument, to the settlor, or his or her estate, as specified. The
bill would also specify that if a trust is revoked by any person
holding a power of revocation other than the settlor, the trust
property would first be disposed of as provided in the trust
instrument, secondly as directed by the person exercising the power
of revocation, and to the extent there is no direction in the trust
instrument or by the person exercising the power of revocation, to
the person exercising the power of revocation, or his or her estate.
The bill would also make related conforming and nonsubstantive
changes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 15401 of the Probate Code is amended to read:
15401. (a) A trust that is revocable by the settlor or any other
person may be revoked in whole or in part by any of the following
methods:
(1) By compliance with any method of revocation provided in the
trust instrument.
(2) By a writing, other than a will, signed by the settlor or any
other person holding the power of revocation and delivered to the
trustee during the lifetime of the settlor or the person holding the
power of revocation. If the trust instrument explicitly makes the
method of revocation provided in the trust instrument the exclusive
method of revocation, the trust may not be revoked pursuant to this
paragraph.
(b) (1) Unless otherwise provided in the instrument, if a trust is
created by more than one settlor, each settlor may revoke the trust
as to the portion of the trust contributed by that settlor, except as
provided in Section 761 of the Family Code.
(2) Notwithstanding paragraph (1), a settlor may grant to another
person, including, but not limited to, his or her spouse, a power to
revoke all or part of that portion of the trust contributed by that
settlor, regardless of whether that portion was separate property or
community property of that settlor, and regardless of whether that
power to revoke is exercisable during the lifetime of that settlor or
continues after the death of that settlor, or both.
(c) A trust may not be modified or revoked by an attorney in fact
under a power of attorney unless it is expressly permitted by the
trust instrument.
(d) This section shall not limit the authority to modify or
terminate a trust pursuant to Section 15403 or 15404 in an
appropriate case.
(e) The manner of revocation of a trust revocable by the settlor
or any other person that was created by an instrument executed before
July 1, 1987, is governed by prior law and not by this section.
SEC. 2. Section 15410 of the Probate Code is amended to read:
15410. At the termination of a trust, the trust property shall be
disposed of as follows:
(a) In the case of a trust that is revoked by the settlor, the
trust property shall be disposed of in the following order of
priority:
(1) As directed by the settlor.
(2) As provided in the trust instrument.
(3) To the extent that there is no direction by the settlor or in
the trust instrument, to the settlor, or his or her estate, as the
case may be.
(b) In the case of a trust that is revoked by any person holding a
power of revocation other than the settlor, the trust property shall
be disposed of in the following order of priority:
(1) As provided in the trust instrument.
(2) As directed by the person exercising the power of revocation.
(3) To the extent that there is no direction in the trust
instrument or by the person exercising the power of revocation, to
the person exercising the power of revocation, or his or her estate,
as the case may be.
(c) In the case of a trust that is terminated by the consent of
the settlor and all beneficiaries, as agreed by the settlor and all
beneficiaries.
(d) In any other case, as provided in the trust instrument or in a
manner directed by the court that conforms as nearly as possible to
the intention of the settlor as expressed in the trust instrument.
(e) If a trust is terminated by the trustee pursuant to
subdivision (b) of Section 15408, the trust property may be
distributed as determined by the trustee pursuant to the standard
provided in subdivision (d) without the need for a court order. If
the trust instrument does not provide a manner of distribution at
termination and the settlor's intent is not adequately expressed in
the trust instrument, the trustee may distribute the trust property
to the living beneficiaries on an actuarial basis.
