Bill Text: CT SB00397 | 2018 | General Assembly | Comm Sub

Connecticut Senate Bill 397 (Prior Session Legislation)

Bill Title: An Act Concerning Adoption Of The Uniform Trust Code, The Connecticut Uniform Directed Trust Act And The Connecticut Qualified Dispositions In Trust Act.

Spectrum: Committee Bill

Status: (Engrossed - Dead) 2018-05-09 - Transmitted Pursuant To Joint Rule 17 [SB00397 Detail]

Download: Connecticut-2018-SB00397-Comm_Sub.html

General Assembly		*Substitute Bill No. 397*
*February Session, 2018*		_____SB00397JUD___040418____

AN ACT CONCERNING ADOPTION OF THE UNIFORM TRUST CODE, THE CONNECTICUT UNIFORM DIRECTED TRUST ACT AND THE CONNECTICUT QUALIFIED DISPOSITIONS IN TRUST ACT.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective October 1, 2018) This section and sections 2 to 87, inclusive, of this act may be cited as the "Connecticut Uniform Trust Code".

Sec. 2. (NEW) (Effective October 1, 2018) Sections 1 to 113, inclusive, of this act apply to express trusts, whether testamentary or inter vivos, and trusts created pursuant to a statute, judgment or decree that requires the trust to be administered in the manner of an express trust and to charitable trusts, except sections 1 to 113, inclusive, of this act shall not apply to statutory trusts created pursuant to chapter 615 of the general statutes.

Sec. 3. (NEW) (Effective October 1, 2018) As used in sections 1 to 105, inclusive, of this act:

(1) "Action", with respect to an act of a trustee, includes a failure to act.

(2) "Ascertainable standard" means a standard relating to an individual's health, education, support or maintenance within the meaning of Section 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, as in effect on October 1, 2018, or as later amended.

(3) "Beneficiary" means a person that (A) has a present or future beneficial interest in a trust, vested or contingent, or (B) in a capacity other than that of trustee, holds a power of appointment over trust property. "Beneficiary" does not include an appointee under a power of appointment unless and until the power is exercised and the trustee has knowledge of the exercise and the identity of the appointee.

(4) "Breach of trust" includes a violation by a trust director or trustee of a duty imposed on that director or trustee by the terms of the trust, sections 1 to 105, inclusive, of this act or any other law of this state pertaining to trusts.

(5) "Directed trust" means a trust for which the terms of the trust grant a power of direction.

(6) "Directed trustee" means a trustee that is subject to a trust director's power of direction.

(7) "Charitable trust" means a trust, or portion of a trust, created for a charitable purpose described in section 26 of this act that is created when property is dedicated for a charitable purpose, whether the dedication is by written instrument, declaration, deed, pledge, judgment or decree.

(8) "Current beneficiary" means a beneficiary that, on the date the beneficiary's qualification is determined, is a distributee or permissible distributee of trust income or principal.

(9) "Conservator of the estate" means a person appointed by the court pursuant to sections 45a-644 to 45a-663, inclusive, of the general statutes to administer the estate of an adult individual.

(10) "Environmental law" means a federal, state or local law, rule, regulation or ordinance relating to protection of the environment.

(11) "Conservator of the person" means a person appointed by the court pursuant to sections 45a-644 to 45a-663, inclusive, of the general statutes to make decisions regarding the support, care, education, health and welfare of an adult individual and includes a conservator of the person of an adult, but does not include a guardian ad litem.

(12) "Inter vivos trust" means any trust that is not a testamentary trust.

(13) "Interests of the beneficiaries" means the beneficial interests provided in the terms of the trust.

(14) "Jurisdiction", with respect to a geographic area, includes a state or country.

(15) "Mandatory distribution" means a distribution of income or principal that the trustee is required to make to a beneficiary under the terms of the trust, including a distribution upon termination of the trust. "Mandatory distribution" does not include a distribution subject to the exercise of the trustee's discretion, regardless of whether the terms of the trust (A) include a support or other standard to guide the trustee in making distribution decisions, or (B) provide that the trustee "may" or "shall" make discretionary distributions, including distributions pursuant to a support standard or other standard.

(16) "Permissible distributee" means a beneficiary that is currently entitled to or eligible to receive a distribution from a trust.

(17) "Person" means an individual, corporation, statutory or business trust, estate, trust, partnership, limited liability company, association, joint venture, court, government, governmental subdivision, agency or instrumentality, public corporation or any other legal or commercial entity.

(18) "Power of direction" means a power over a trust granted to a person by the terms of the trust to the extent the power is exercisable while the person is not serving as a trustee. "Power of direction" includes a power over the investment, management, or distribution of trust property or other matters of trust administration, but does not include the powers described in subsection (b) of section 91 of this act.

(19) "Power of withdrawal" means a presently exercisable general power of appointment other than a power exercisable only upon consent of the trustee or a person holding an adverse interest.

(20) "Property" means anything that may be the subject of ownership, whether real or personal and whether legal or equitable, or any interest in such property.

(21) "Qualified beneficiary" means a beneficiary that, on the date the beneficiary's qualification is determined: (A) Is a distributee or permissible distributee of trust income or principal; (B) would be a distributee or permissible distributee of trust income or principal if the interests of the distributees described in subparagraph (A) of this subdivision terminated on such date without causing the trust to terminate; or (C) would be a distributee or permissible distributee of trust income or principal if the trust terminated on such date.

(22) "Revocable", as applied to a trust, means revocable by the settlor without the consent of the trustee or a person holding an adverse interest.

(23) "Settlor" means a person, including a testator, that creates or contributes property to a trust. If more than one person creates or contributes property to a trust, each person is a settlor of the portion of the trust property attributable to such person's contribution, except to the extent another person has the power to revoke or withdraw such portion and as otherwise provided in section 46 of this act.

(24) "Spendthrift provision" means a term of a trust that restrains both voluntary and involuntary transfer of a beneficiary's interest.

(25) "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States, and includes an Indian tribe or band recognized by federal law or formally acknowledged by a state.

(26) "Terms of a trust" means:

(A) The manifestation of the settlor's intent regarding a trust's provisions as:

(i) Expressed in the trust instrument; or

(ii) Established by other evidence that would be admissible in a judicial proceeding; or

(B) The trust's provisions, as established, determined or amended by:

(i) A trustee or trust director in accordance with applicable law;

(ii) Court order; or

(iii) A nonjudicial settlement agreement under section 11 of this act.

(27) "Testamentary trust" means a trust created under a will.

(28) "Trust director" means a person that is granted a power of direction by the terms of a trust to the extent the power is exercisable while the person is not serving as a trustee, provided a person is a trust director whether or not the terms of the trust refer to the person as a trust director and whether or not the person is a beneficiary or settlor of the trust.

(29) "Trust instrument" means any instrument executed by the settlor that contains terms of the trust, including any amendments thereto. In the case of a charitable trust, "trust instrument" means any written instrument by which property is dedicated for a charitable purpose described in section 26 of this act.

(30) "Trustee" includes an original, additional and successor trustee and a cotrustee.

Sec. 4. (NEW) (Effective October 1, 2018) (a) Subject to subsection (b) of this section, for the purposes of sections 1 to 105, inclusive, of this act, a person has knowledge of a fact if the person (1) has actual knowledge of the fact, (2) has received a notice or notification of the fact, or (3) from all the facts and circumstances known to the person at the time in question, has reason to know the fact.

(b) An organization that conducts activities through employees has notice or knowledge of a fact involving a trust only from the time the information was received by an employee having responsibility to act for the trust, or from the time the information would have been brought to the employee's attention if the organization had exercised reasonable diligence. An organization exercises reasonable diligence if it maintains reasonable routines for communicating significant information to the employee having responsibility to act for the trust and there is reasonable compliance with the routines. Reasonable diligence does not require an employee of the organization to communicate information unless the communication is part of the employee's regular duties or the employee knows a matter involving the trust would be materially affected by the information.

Sec. 5. (NEW) (Effective October 1, 2018) (a) Except as otherwise provided in the terms of the trust, sections 1 to 105, inclusive, of this act govern the duties and powers of a trustee, relations among trustees and the rights and interests of a beneficiary.

(b) The terms of a trust prevail over any provision of sections 1 to 105, inclusive, of this act except: (1) The requirements for creating a trust; (2) the duty of a trustee to act in good faith and in accordance with the terms and purposes of the trust; (3) the requirement of section 25 of this act that a trust have a purpose that is lawful, not contrary to public policy; (4) the power of the court to modify or terminate a trust under sections 30 to 37, inclusive, of this act; (5) the effect of a spendthrift provision and the rights of certain creditors and assignees to reach a trust as provided in sections 39 to 46, inclusive, of this act; (6) the power of the court under section 52 of this act to require, dispense with, modify or terminate a bond; (7) the power of the court under section 58 of this act to adjust a trustee's compensation specified in the terms of the trust that is unreasonably low or high; (8) the effect of an exculpatory term under section 80 of this act; (9) the rights under sections 82 to 85, inclusive, of this act of a person other than a trustee or beneficiary; (10) periods of limitation for commencing a judicial proceeding; and (11) the power of the court to take such action and exercise such jurisdiction as may be necessary in the interests of justice.

Sec. 6. (NEW) (Effective October 1, 2018) The common law of trusts and principles of equity supplement sections 1 to 113, inclusive, of this act, except to the extent modified by sections 1 to 113, inclusive, of this act or another provision of the general statutes.

Sec. 7. (NEW) (Effective October 1, 2018) The meaning and effect of the terms of a trust are determined by: (1) The law of the jurisdiction designated in the terms of the trust, unless the designation of such jurisdiction's law is contrary to a strong public policy of the jurisdiction having the most significant relationship to the matter at issue; or (2) in the absence of a controlling designation in the terms of the trust, the law of the jurisdiction having the most significant relationship to the matter at issue.

Sec. 8. (NEW) (Effective October 1, 2018) (a) Without precluding other means for establishing a sufficient connection with the designated jurisdiction, terms of a trust designating the principal place of administration are valid and controlling if: (1) A trustee's principal place of business is located in, or a trustee is a resident of, the designated jurisdiction; (2) a trust director's principal place of business is located in, or a trust director is a resident of, the designated jurisdiction; or (3) all or part of the administration occurs in the designated jurisdiction.

(b) A trustee is under a continuing duty to administer the trust at a place appropriate to its purposes, its administration and the interests of the beneficiaries.

(c) Without precluding the right of the court to order, approve or disapprove a transfer, the trustee of an inter vivos trust, and the trustee of a testamentary trust with court approval, in furtherance of the duty prescribed by subsection (b) of this section, may transfer the trust's principal place of administration to another state or to a jurisdiction outside of the United States. A charitable trust may not be transferred to a jurisdiction outside of the United States.

(d) The trustee shall notify the qualified beneficiaries of a proposed transfer of a trust's principal place of administration not less than sixty days prior to the date of initiating the transfer. The notice of proposed transfer shall include:

(1) The name of the jurisdiction to which the principal place of administration is to be transferred;

(2) The address and telephone number at the new location at which the trustee can be contacted;

(3) An explanation of the reasons for the proposed transfer;

(4) The date on which the proposed transfer is anticipated to occur; and

(5) The date, not less than sixty days after the giving of the notice, by which the qualified beneficiary shall notify the trustee of an objection to the proposed transfer.

(e) The authority of a trustee under this section to transfer a trust's principal place of administration shall terminate if a qualified beneficiary notifies the trustee of an objection to the proposed transfer on or before the date specified in the notice.

(f) In connection with a transfer of the trust's principal place of administration, the trustee may transfer some or all of the trust property to a successor trustee designated in the terms of the trust or appointed pursuant to section 54 of this act.

Sec. 9. (NEW) (Effective October 1, 2018) (a) Notice to a person under sections 1 to 113, inclusive, of this act, or the sending of a document to a person under sections 1 to 113, inclusive, of this act, shall be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document. Permissible methods of notice or for sending a document include first-class mail, personal delivery, delivery to the person's last known place of residence or place of business, or a properly directed electronic message, if the person has consented in advance to receive notices or documents by electronic message.

(b) Notice otherwise required under sections 1 to 113, inclusive, of this act, or a document otherwise required to be sent under sections 1 to 113, inclusive, of this act, need not be provided to a person whose identity or location is unknown to and not reasonably ascertainable by the trustee.

(c) Notice under sections 1 to 113, inclusive, of this act, or the sending of a document under sections 1 to 113, inclusive, of this act, may be waived by the person to be notified or to be sent the document.

(d) Notice of a judicial proceeding shall be given as provided in any applicable court rules.

Sec. 10. (NEW) (Effective October 1, 2018) (a) Whenever notice to qualified beneficiaries of a trust is required under sections 1 to 113, inclusive, of this act, the trustee shall also give notice to any other beneficiary who has sent the trustee a request for notice.

(b) A charitable organization expressly designated to receive distributions under the terms of a charitable trust has the rights of a qualified beneficiary under sections 1 to 113, inclusive, of this act if the charitable organization, on the date the charitable organization's qualification is being determined: (1) Is a distributee or permissible distributee of trust income or principal; (2) would be a distributee or permissible distributee of trust income or principal upon the termination of the interests of other distributees or permissible distributees then receiving or eligible to receive distributions; or (3) would be a distributee or permissible distributee of trust income or principal if the trust terminated on such date.

(c) The Attorney General has the rights of a qualified beneficiary with respect to a charitable trust having its principal place of administration in this state.

(d) A person appointed to enforce a trust created for the care of an animal under section 45a-489a of the general statutes, or another noncharitable purpose as provided in section 29 of this act, has the rights of a qualified beneficiary under sections 1 to 113, inclusive, of this act.

(e) A charitable organization shall only be granted the rights of a qualified beneficiary under this section if its interest in a charitable trust is not otherwise subject to any power of appointment, removal or any other power of termination on the date that its qualification is otherwise determined under this section.

Sec. 11. (NEW) (Effective October 1, 2018) (a) For the purposes of this section, "interested persons" means persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the court.

(b) Except as provided in subsections (c) and (e) of this section, interested persons may enter into a binding nonjudicial settlement agreement with respect to any matter involving an inter vivos trust.

(c) A nonjudicial settlement agreement is valid only to the extent it does not violate a material purpose of the trust and includes terms and conditions that could be properly approved by the court under sections 1 to 113, inclusive, of this act or other applicable law.

(d) Matters that may be resolved by a nonjudicial settlement agreement include: (1) The interpretation or construction of the terms of the trust; (2) the approval of a trustee's report or accounting; (3) direction to a trustee to refrain from performing a particular act or the grant to a trustee of any necessary or desirable power; (4) the resignation or appointment of a trustee and the determination of a trustee's compensation; (5) transfer of a trust's principal place of administration; and (6) liability of a trustee for an action relating to the trust.

(e) A nonjudicial settlement agreement may not modify or terminate an irrevocable trust. Such modification or termination may only be accomplished under the provisions of sections 30 to 37, inclusive, of this act.

(f) Any interested person may request the court to approve a nonjudicial settlement agreement, to determine whether the representation as provided in sections 17 to 21, inclusive, of this act was adequate, and to determine whether the agreement contains terms and conditions the court can properly approve.

Sec. 12. (NEW) (Effective October 1, 2018) A trustee has an insurable interest in the life of an individual insured under a life insurance policy that is owned by the trustee or that designates the trust itself as the owner if, on the date the policy is issued:

(1) The insured is: (A) A settlor of the trust; or (B) an individual in whom a settlor of the trust has, or would have had if living at the time the policy was issued, an insurable interest; and

(2) The life insurance proceeds are primarily for the benefit of one or more trust beneficiaries that have: (A) An insurable interest in the life of the insured; or (B) a substantial interest engendered by love and affection in the continuation of the life of the insured and, if not already included under subdivision (1) of this section, who are: (i) Related within the third degree or closer, as measured by the civil law system of determining degrees of relation, either by blood or law, to the insured; or (ii) stepchildren of the insured.

Sec. 13. (NEW) (Effective October 1, 2018) (a) A testamentary trust is subject to continuing judicial supervision until the administration of the trust is transferred to another state pursuant to other law of this state.

(b) An inter vivos trust is not subject to continuing judicial supervision.

Sec. 14. (NEW) (Effective October 1, 2018) (a) By accepting the trusteeship of a trust having its principal place of administration in this state, or by moving the principal place of administration to this state, the trustee submits personally to the jurisdiction of the courts of this state regarding any matter involving the trust.

(b) With respect to their interests in the trust, the beneficiaries of a trust having its principal place of administration in this state are subject to the jurisdiction of the courts of this state regarding any matter involving the trust. By accepting a distribution from such a trust, the recipient submits personally to the jurisdiction of the courts of this state regarding any matter involving the trust.

(c) This section shall not preclude other methods of obtaining jurisdiction over a trustee, beneficiary or other person receiving property from the trust.

Sec. 15. (NEW) (Effective October 1, 2018) Subject matter jurisdiction for a proceeding under sections 1 to 113, inclusive, of this act shall be determined under other law of this state.

Sec. 16. (NEW) (Effective October 1, 2018) Venue for a proceeding under sections 1 to 113, inclusive, of this act shall be determined under other law of this state.

Sec. 17. (NEW) (Effective October 1, 2018) (a) Notice to a person who may represent and bind another person under this section and sections 18 to 21, inclusive, of this act has the same effect as if notice were given directly to such other person.

(b) The consent of a person who may represent and bind another person under this section and sections 18 to 21, inclusive, of this act is binding on the person represented unless the person represented objects to the representation before the consent would otherwise have become effective.

(c) Except as provided in section 48 of this act, a person that, pursuant to this section and sections 18 to 21, inclusive, of this act, may represent a settlor who lacks capacity may receive notice and give a binding consent on the settlor's behalf.

(d) Notwithstanding any provision of the general statutes, this section and sections 18 to 21, inclusive, of this act shall apply to all judicial proceedings and all nonjudicial settlements, agreements or actions under sections 1 to 113, inclusive, of this act and under any other provisions of the general statutes pertaining to trust matters.

(e) As used in this section, "represent" shall not be construed to permit a person who has not been admitted as an attorney pursuant to section 51-80 of the general statutes to serve as legal counsel for any other person in any matter arising under sections 1 to 113, inclusive, of this act.

Sec. 18. (NEW) (Effective October 1, 2018) To the extent there is no conflict of interest between the holder of a power of appointment and the persons represented with respect to the particular question or dispute: (1) The sole holder or all coholders of any power of appointment, whether or not presently exercisable, shall represent the potential appointees; and (2) the sole holder or all coholders of a power of revocation or a general power of appointment, including one in the form of a power of amendment, shall also represent the takers in default of the exercise thereof.

Sec. 19. (NEW) (Effective October 1, 2018) To the extent there is no conflict of interest between the representative and the person represented or among those being represented with respect to a particular question or dispute: (1) A conservator may represent and bind the estate that the conservator controls; (2) a guardian may represent and bind the ward if a conservator of the ward's estate has not been appointed; (3) an agent having authority to do so may represent and bind the principal; (4) a trustee may represent and bind the beneficiaries of the trust; (5) an executor or administrator of a decedent's estate may represent and bind persons interested in the estate; and (6) if a conservator or guardian has not been appointed, a parent may represent and bind the parent's minor or unborn child.

Sec. 20. (NEW) (Effective October 1, 2018) Unless otherwise represented, a minor, an incapacitated or unborn individual, or a person whose identity or location is unknown and not reasonably ascertainable, may be represented by and bound by another person having a substantially identical interest with respect to the particular question or dispute, but only to the extent there is no conflict of interest between the representative and the person being represented.

Sec. 21. (NEW) (Effective October 1, 2018) (a) If the court determines that an interest is not represented pursuant to this section and sections 17 to 20, inclusive, of this act, or that the otherwise available representation might be inadequate, the court may appoint a guardian ad litem to receive notice, give consent, and otherwise represent, bind and act on behalf of a minor, an incapacitated or unborn individual, or a person whose identity or location is unknown. A guardian ad litem may be appointed to represent several persons or interests.

(b) A guardian ad litem may act on behalf of the individual represented with respect to any matter arising under sections 1 to 113, inclusive, of this act, whether or not a judicial proceeding concerning the trust is pending.

(c) In making decisions in any matter, a guardian ad litem may consider general benefit accruing to the living members of the individual's family.

Sec. 22. (NEW) (Effective October 1, 2018) A trust may be created by: (1) Transfer of property to another person as trustee during the settlor's lifetime, by deed or otherwise, or by will or other disposition taking effect upon the settlor's death; (2) declaration by the owner of property that the owner holds identifiable property as trustee; (3) exercise of a power of appointment in favor of a trustee; (4) transfer of property pursuant to a statute or judgment that requires property to be administered in the manner of an express trust, including, but not limited to, a trust created by the guardian of the estate of a minor or by the conservator of an estate, or a trust described in 42 USC 1396p(d)(4), as amended from time to time; or (5) court order.

Sec. 23. (NEW) (Effective October 1, 2018) (a) A trust is created only if:

(1) The settlor has capacity to create a trust;

(2) The settlor indicates an intention to create the trust;

(3) The trust has a definite beneficiary or is (A) a charitable trust, (B) a trust for the care of an animal, as provided in section 45a-489a of the general statutes, or (C) a trust for a noncharitable purpose, as provided in section 29 of this act; and

(4) The trustee has duties to perform.

(b) A beneficiary is definite if the beneficiary can be ascertained now or in the future, subject to any applicable rule against perpetuities.

(c) A power in a trustee to select a beneficiary from an indefinite class is valid. If the power is not exercised within a reasonable time, the power fails and the property subject to the power passes to the persons who would have taken the property had the power not been conferred.

(d) The settlor's power to create or contribute to a trust may be exercised by (1) an agent under a power of attorney only to the extent expressly authorized to create or contribute property to a trust, or (2) by a conservator of the estate as authorized by the court.

Sec. 24. (NEW) (Effective October 1, 2018) An inter vivos trust is validly created if its creation complies with the law of the jurisdiction in which the trust instrument was executed, or the law of the jurisdiction in which, at the time of creation: (1) The settlor was domiciled, had a place of abode or was a national; (2) a trustee was domiciled or had a place of business; or (3) any trust property was located.

Sec. 25. (NEW) (Effective October 1, 2018) A trust may be created only to the extent its purposes are lawful and not contrary to public policy.

Sec. 26. (NEW) (Effective October 1, 2018) (a) A charitable trust may be created for the relief of poverty, the advancement of education or religion, the promotion of health, governmental or municipal purposes or other purposes the achievement of which is beneficial to the community, consistent with the provisions of sections 45a-514 and 47-2 of the general statutes.

(b) If the terms of a charitable trust do not indicate a particular charitable purpose or beneficiary, and if the trustee is not given discretion to select the charitable beneficiaries consistent with the provisions of section 45a-515 of the general statutes, the court may select one or more charitable purposes or beneficiaries. The selection shall be consistent with the settlor's intention to the extent it can be ascertained.

(c) The settlor of a charitable trust, among others, may maintain a proceeding to enforce the trust, but only if the settlor has expressly retained the right to do so in the trust instrument.

Sec. 27. (NEW) (Effective October 1, 2018) A trust or a provision of a trust is void to the extent its creation was induced by fraud, duress or undue influence.

Sec. 28. (NEW) (Effective October 1, 2018) Except as required by any provision of the general statutes other than sections 1 to 113, inclusive, of this act, a trust need not be evidenced by a trust instrument, but the creation of an oral trust and its terms may be established only by clear and convincing evidence.

Sec. 29. (NEW) (Effective October 1, 2018) Except as provided in section 45a-489a of the general statutes or any other applicable provision of the general statutes, the following rules apply to a trust created pursuant to this section:

(1) A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficiary or for a noncharitable but otherwise valid purpose to be selected by the trustee. The trust may not be enforced for more than ninety years.

(2) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court.

(3) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use shall be distributed to the settlor, if then living, otherwise to the settlor's successors in interest.

Sec. 30. (NEW) (Effective October 1, 2018) (a) In addition to the methods of termination prescribed by section 35 of this act, a noncharitable trust terminates to the extent the trust is revoked or expires pursuant to its terms, no purpose of the trust remains to be achieved or the purposes of the trust have become unlawful, contrary to public policy or impossible to achieve. A charitable trust may be terminated only in accordance with the provisions of section 45a-520 of the general statutes.

(b) A proceeding to approve or disapprove a proposed modification or termination under sections 33 to 35, inclusive, of this act, or trust combination or division under section 38 of this act, may be commenced by a trustee or beneficiary and, with respect to a charitable trust, by the Attorney General. The settlor of a charitable trust that has expressly retained the right to do so in the trust instrument may maintain a proceeding to modify the trust under section 33 of this act.

Sec. 31. (NEW) (Effective October 1, 2018) (a) If, upon petition, the court finds that the settlor and all qualified beneficiaries consent to the modification or termination of a noncharitable irrevocable trust, or of a charitable trust whose settlor has expressly retained the right to do so in the trust instrument, the court may approve the modification or termination even if the modification or termination is inconsistent with a material purpose of the trust. A settlor's power to consent to a trust's modification or termination may be exercised by (1) an agent under a power of attorney only to the extent expressly authorized by the power of attorney or the terms of the trust; or (2) the settlor's conservator with the approval of the court supervising the conservatorship. This subsection shall not apply to irrevocable trusts created before, or to revocable trusts that become irrevocable prior to, October 1, 2018.

(b) A noncharitable irrevocable trust may be terminated or modified upon consent of the trustee and all of the qualified beneficiaries if the court concludes that the termination or modification is not inconsistent with a material purpose of the trust and the probable intent of the settlor.

(d) Upon termination of a trust under subsection (a) or (b) of this section, the trustee shall distribute the trust property as agreed by the beneficiaries.

(e) If the trustee consents but not all of the beneficiaries consent to a proposed modification or termination of the trust under subsection (a) or (b) of this section, the modification or termination may be approved by the court if the court is satisfied that:

(1) If all of the beneficiaries had consented, the trust could have been modified or terminated under this section; and

(2) The interests of a beneficiary who does not consent will be adequately protected.

(f) In any proceeding under this section, the trustee shall be named an interested party.

Sec. 32. (NEW) (Effective October 1, 2018) (a) The court may modify the administrative or dispositive terms of a noncharitable trust or terminate the noncharitable trust if, because of circumstances not anticipated by the settlor, modification or termination will further the purposes of the trust. To the extent practicable, the modification shall be made in accordance with the settlor's probable intention.

(b) The court may modify the administrative terms of a trust if continuation of the trust on its existing terms would be impracticable or wasteful or impair the trust's administration.

(c) Upon termination of a trust under this section, the trustee shall distribute the trust property in a manner consistent with the purposes of the trust.

(d) For the purposes of this section, "circumstances not anticipated by the settlor" does not include a change in the corporate identity of a trustee.

Sec. 33. (NEW) (Effective October 1, 2018) Except as provided in section 34 of this act, if a particular charitable purpose becomes impossible, impracticable or illegal: (1) The trust does not fail, in whole or in part; (2) the trust property does not revert to the settlor or the settlor's successors in interest; and (3) the court may apply cy pres to modify the trust by directing that the trust property be applied or distributed, in whole or in part, in a manner consistent with the settlor's charitable purposes.

Sec. 34. (NEW) (Effective October 1, 2018) A provision in the terms of a charitable trust that would result in distribution of the trust property to a noncharitable beneficiary prevails over the power of the court under section 33 of this act to apply cy pres to modify or terminate the trust only if, when the provision takes effect: (1) Except as provided in section 45a-505 of the general statutes, the trust property is to revert to the settlor and the settlor is still living; or (2) fewer than twenty-one years have elapsed since the date of the trust's creation.

Sec. 35. (NEW) (Effective October 1, 2018) (a) If trust property has a total value of less than two hundred thousand dollars and after notice to the qualified beneficiaries, the trustee of a testamentary noncharitable trust who obtains court approval, or the trustee of an inter vivos noncharitable trust, with or without court approval, may terminate the trust if such trustee concludes that the termination is not inconsistent with the probable intent of the settlor and the value or character of the trust property is insufficient or inappropriate to justify the cost of administration.

(b) The court may modify or terminate a trust or remove the trustee and appoint a different trustee if the total value of the trust property is less than the amount specified in subsection (a) of this section.

(c) Upon termination of a trust under this section, the trustee shall distribute the trust property in a manner consistent with the purposes of the trust.

(d) This section shall not apply to an easement for conservation or preservation.

Sec. 36. (NEW) (Effective October 1, 2018) The court may reform the terms of a trust, even if unambiguous, to conform the terms to the settlor's intention if it is proved by clear and convincing evidence what the settlor's intention was and that the terms of the trust were affected by a mistake of fact or law, whether in expression or inducement.

Sec. 37. (NEW) (Effective October 1, 2018) To achieve the settlor's tax objectives, the court may modify the terms of a trust in a manner that is not contrary to the settlor's probable intention. The court may provide that the modification has retroactive effect.

Sec. 38. (NEW) (Effective October 1, 2018) After notice to the current beneficiaries, a trustee may combine two or more trusts into a single trust or divide a trust into two or more separate trusts, if the result does not impair rights of any beneficiary or adversely affect achievement of the purposes of the trust.

Sec. 39. (NEW) (Effective October 1, 2018) (a) To the extent a beneficiary's interest in a trust is not subject to a spendthrift provision, except as provided in this section and sections 40 to 46, inclusive, of this act, the court may authorize a creditor or assignee of the beneficiary to reach the beneficiary's interest by attachment of present or future distributions to or for the benefit of the beneficiary. The court may limit the award to such relief as is appropriate under the circumstances, provided the court may not grant relief beyond the attachment of present or future distributions.

(b) (1) A trustee of a charitable trust and a person holding and administering an endowment fund or an institutional fund, as defined in section 45a-535a of the general statutes, shall not mortgage, hypothecate, pledge, use as collateral or otherwise encumber any of the following assets of such charitable trust, endowment fund or institutional fund, if the source of the asset was a charitable gift: (A) Funds for which expenditures are restricted by the settlor for a purpose other than the general purposes of a charity or institution; and (B) the principal or corpus of a charitable trust or institutional fund for which such principal or corpus is restricted to investment or endowment purposes.

(2) No creditor, receiver appointed pursuant to chapter 920 of the general statutes, or trustee appointed under Title 11 of the United States Code may attach, garnish, lien or otherwise use funds subject to the provisions of subdivision (1) of this subsection for the purpose of applying such asset to payment of a charitable beneficiary's debt or including such asset in the receivership or bankruptcy estate.

Sec. 40. (NEW) (Effective October 1, 2018) (a) A spendthrift provision is valid only if it restrains both voluntary and involuntary transfer of a beneficiary's interest. A provision in the terms of the trust permitting the voluntary transfer of a beneficiary's interest, but only with the consent of another person or entity, including the trustee, specified in the terms of the trust, shall be deemed to be an acceptable restraint on voluntary transfer.

(b) A term of a trust providing that the interest of a beneficiary is held subject to a "spendthrift trust", or words of similar import, is sufficient to restrain both voluntary and involuntary transfer of the beneficiary's interest.

(c) A beneficiary may not transfer an interest in a trust in violation of a valid spendthrift provision and, except as provided in sections 39 to 46, inclusive, of this act, a creditor or assignee of the beneficiary may not reach the interest or a distribution by the trustee before its receipt by the beneficiary.

Sec. 41. (NEW) (Effective October 1, 2018) (a) As used in this section and section 42 of this act, "child" includes any person for whom an order or judgment for child support has been entered in this or another state.

(b) A spendthrift provision is valid even though a beneficiary is named as the sole trustee or as a cotrustee of the trust.

(d) Even if a trust contains a spendthrift provision, a beneficiary's child who has a judgment or court order against the beneficiary for support or maintenance may obtain from a court an order attaching present or future distributions to or for the benefit of the beneficiary, but only if distributions can be made for the beneficiary's support under the terms of the trust.

Sec. 42. (NEW) (Effective October 1, 2018) (a) Except as provided in subdivision (2) of subsection (a) of section 43 of this act or subsection (b) of this section, whether or not a trust contains a spendthrift provision, a creditor of a beneficiary may not compel a distribution that is subject to the trustee's discretion, even if: (1) The discretion is expressed in the form of a standard of distribution; or (2) the trustee has abused the discretion.

(b) To the extent a trustee has not complied with a standard of distribution or has abused a discretion: (1) A distribution may be ordered by the court to satisfy a judgment or court order against the beneficiary for support or maintenance of the beneficiary's child; and (2) the court may direct the trustee to pay to the child only such amount as is equitable under the circumstances, but in no event more than the amount the trustee would have been required to distribute to or for the benefit of the beneficiary had the trustee complied with the standard or not abused the discretion.

(c) This section shall not limit any preexisting right of a beneficiary to maintain a judicial proceeding against a trustee for an abuse of discretion or failure to comply with a standard for distribution.

(d) With respect to the powers set forth in section 46 of this act, the provisions of this section shall apply even though the beneficiary is the sole trustee or a cotrustee of the trust.

Sec. 43. (NEW) (Effective October 1, 2018) (a) Whether or not the terms of a trust contain a spendthrift provision, and except as provided in sections 106 to 112, inclusive, of this act, the following rules apply:

(1) During the lifetime of the settlor, the property of a revocable trust is subject to claims of the settlor's creditors.

(2) Except as provided in subdivisions (4) and (5) of this subsection, with respect to an irrevocable trust, a creditor or assignee of the settlor may reach the maximum amount that can be distributed to or for the benefit of the settlor. If a trust has more than one settlor, the amount the creditor or assignee of a particular settlor may reach may not exceed the settlor's interest in the portion of the trust attributable to such settlor's contribution.

(3) With respect to a trust created pursuant to 42 USC 1396p(d)(4)(A) or (C), as amended from time to time, after notice to the creditor and the state, the court may limit the award to a creditor of the settlor under subdivision (1) or (2) of this subsection to such relief as is appropriate under the circumstances, considering, among any other factors determined to be appropriate by the court, the supplemental needs of the beneficiary.

(4) A creditor or assignee of the settlor may not reach the assets of an irrevocable trust, in whole or in part, solely because of the existence of a discretionary power granted to the trustee by the terms of the trust, or any other provision of law, to pay directly to the taxing authorities or to reimburse the settlor for any tax on trust income or principal which is payable by the settlor under the law imposing such tax.

(5) A creditor or assignee of a settlor may not reach the assets of an irrevocable trust except in accordance with the terms of the trust instrument if (A) all of the settlors of the trust are commercial entities organized to conduct business activities; (B) at least one trustee is a commercial entity organized to conduct business activities; and (C) the trust is created by contract in order to facilitate a business purpose of the settlors.

(b) For the purposes of this section: (1) Except as provided in section 46 of this act, during the period the power may be exercised, the holder of a power of withdrawal is treated in the same manner as the settlor of a revocable trust to the extent of the property subject to the power; and (2) upon the lapse, release or waiver of the power, the holder is treated as the settlor of the trust only to the extent the value of the property affected by the lapse, release or waiver exceeds the greater of the amount specified in Section 2041(b)(2) or 2514(e) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, and the regulations adopted thereunder, or Section 2503(b) of said Internal Revenue Code and the regulations adopted thereunder, in each case as in effect on October 1, 2018.

Sec. 44. (NEW) (Effective October 1, 2018) Except as provided in section 46 of this act, whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution upon termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the mandated distribution date.

Sec. 45. (NEW) (Effective October 1, 2018) Trust property shall not be subject to personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt.

Sec. 46. (NEW) (Effective October 1, 2018) (a) For all purposes under this section and sections 39 to 45, inclusive, of this act, whether or not a trust contains a spendthrift provision, a creditor of a beneficiary, other than a creditor of the settlor if the settlor is a beneficiary of the trust, may not attach or compel a distribution of property that is subject:

(1) To a power of withdrawal held by the beneficiary if the value of the property subject to the power does not exceed the greater of the amount specified in Section 2041(b)(2) or 2514(e) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, and the regulations adopted thereunder, or Section 2503(b) of said Internal Revenue Code and the regulations adopted thereunder, in each case as in effect on October 1, 2018;

(2) Except as provided in subsection (b) of section 42 of this act, to a power, whether mandatory or discretionary, held by the trustee of the trust, including a power held by the beneficiary as the sole trustee or a cotrustee of the trust, to make distributions to or for the benefit of the beneficiary, if the power is exercisable by the trustee only in accordance with an ascertainable standard relating to such beneficiary's individual health, education, support or maintenance within the meaning of Section 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, and the regulations adopted thereunder, as in effect on October 1, 2018; or

(3) To a power, whether mandatory or discretionary, held by the trustee of the trust, including a power held by the beneficiary as the sole trustee or a cotrustee of the trust, to make distributions to or for the benefit of a person who the beneficiary has an obligation to support, if the power is exercisable by the trustee only in accordance with an ascertainable standard relating to such person's individual health, education, support or maintenance within the meaning of Section 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, and the regulations adopted thereunder, as in effect on October 1, 2018.

(b) A beneficiary holding a power set forth in subsection (a) of this section shall not, during the period the power may be exercised or upon the lapse, release or waiver of the power, be treated as a settlor of the trust.

(c) This section and sections 39 to 45, inclusive, of this act shall not apply to statutory trusts created pursuant to chapter 615 of the general statutes to the extent inconsistent with the terms of said chapter.

Sec. 47. (NEW) (Effective October 1, 2018) The capacity required to create, amend, revoke or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that required to make a will.

Sec. 48. (NEW) (Effective October 1, 2018) (a) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. This subsection shall not apply to (1) a trust created under an instrument executed before October 1, 2018, (2) charitable pledges, or (3) other charitable gifts in which the charitable interest has otherwise vested.

(b) If a revocable trust is created or funded by more than one settlor: (1) To the extent the trust consists of community property, the trust may be revoked by either spouse acting alone but may be amended only by joint action of both spouses; and (2) to the extent the trust consists of property other than community property, each settlor may revoke or amend the trust with regard to the portion of the trust property attributable to such settlor's contribution.

(c) (1) The settlor may revoke or amend a revocable trust by substantial compliance with a method provided in the terms of the trust.

(2) If the terms of the trust do not provide a method, or the method provided in the terms is not expressly made exclusive, the settlor may revoke or amend a revocable trust by (A) executing a later will or codicil that has been admitted to probate and that expressly refers to the trust or expressly devises specifically identified items of real or personal property that would otherwise have passed according to the terms of the trust, or (B) any other method manifesting clear and convincing evidence of the settlor's intent, provided (i) a written revocable trust may only be amended by a later written instrument, and (ii) a written revocable trust may only be revoked by a later written instrument or by the burning, cancellation, tearing or obliteration of the revocable trust by the settlor or by some person in the settlor's presence and at the settlor's direction.

(d) Upon revocation of a revocable trust, the trustee shall deliver the trust property as the settlor directs.

(e) A settlor's powers with respect to revocation, amendment or distribution of trust property may be exercised by an agent under a power of attorney only to the extent expressly authorized by the terms of the trust and the power of attorney.

(f) Unless expressly prohibited by the terms of the trust, a conservator of the settlor may exercise a settlor's powers with respect to revocation, amendment or distribution of trust property with the approval of the trustee and the court supervising the conservatorship.

(g) A trustee who does not know that a trust has been revoked or amended is not liable to the settlor or settlor's successors in interest for distributions made and other actions taken on the assumption that the trust had not been amended or revoked.

(h) A trust created pursuant to 42 USC 1396p(d)(4), as amended from time to time, is irrevocable if the terms of the trust prohibit the settlor from revoking it, even if the settlor's estate or the settlor's heirs at law are named as the remainder beneficiary of the trust upon the settlor's death.

Sec. 49. (NEW) (Effective October 1, 2018) (a) To the extent a trust is revocable by a settlor, a trustee may follow a direction of the settlor that is contrary to the terms of the trust. To the extent a trust is revocable by a settlor in conjunction with a person other than a trustee or person holding an adverse interest, the trustee may follow a direction from the settlor and the other person holding the power to revoke even if the direction is contrary to the terms of the trust.

(b) To the extent a trust is revocable and the settlor has capacity to revoke the trust, rights of the beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the settlor.

(c) During the period the power may be exercised, the holder of a power of withdrawal has the rights of a settlor of a revocable trust under this section to the extent of the property subject to the power.

Sec. 50. (NEW) (Effective October 1, 2018) (a) A person may commence a judicial proceeding to contest the validity of a trust that was revocable at the settlor's death within the earlier of:

(1) One year after the settlor's death; or

(2) Sixty days after the date on which the trustee sent the person a copy of the trust instrument and a notice informing the person of the trust's existence, of the trustee's name and address, and of the time allowed for commencing a proceeding. The trustee shall have the right to provide the documentation and information set forth in this subdivision to (A) all persons who would be entitled to notice of the application for probate of a will or administration of an intestate estate or to notice of the admission of a will to probate or the granting of letters of administration, and (B) the beneficiaries of the trust and all persons whose interests are, in the opinion of the trustee, adversely affected by the trust.

(b) Upon the death of the settlor of a trust that was revocable at the settlor's death, the trustee may proceed to distribute the trust property in accordance with the terms of the trust. The trustee is not subject to liability for doing so unless: (1) The trustee knows of a pending judicial proceeding contesting the validity of the trust; (2) a potential contestant has notified the trustee of a possible judicial proceeding to contest the trust and a judicial proceeding is commenced within sixty days after the date on which the contestant sent the notification; or (3) the trustee failed to give notice in accordance with section 70 of this act.

Sec. 51. (NEW) (Effective October 1, 2018) (a) Except as provided in subsection (c) of this section, a person designated as trustee accepts the trusteeship: (1) By substantially complying with a method of acceptance provided in the terms of the trust; (2) if the terms of the trust do not provide a method or the method provided in the terms is not expressly made exclusive, by accepting delivery of the trust property, exercising powers or performing duties as trustee, or otherwise indicating acceptance of the trusteeship; or (3) in the case of a testamentary trust, filing an acceptance of trust in the court with jurisdiction over the trust.

(b) A person designated as trustee who has not yet accepted the trusteeship may reject the trusteeship. A designated trustee who does not accept the trusteeship within a reasonable time after knowing of the designation is deemed to have rejected the trusteeship.

(c) A person designated as trustee, without accepting the trusteeship, may: (1) Act to preserve the trust property if, within a reasonable time after acting, the person sends a rejection of the trusteeship to the settlor or, if the settlor is dead or lacks capacity, to a qualified beneficiary; and (2) inspect or investigate trust property to determine potential liability under state or federal environmental or other law or for any other purpose.

Sec. 52. (NEW) (Effective October 1, 2018) (a) A trustee shall give bond to secure performance of the trustee's duties only if the court finds that a bond is needed to protect the interests of the beneficiaries or is required by the terms of the trust and, in the case of noncharitable trusts, the court has not dispensed with the requirement.

(b) The court may specify the amount of a bond, its liabilities and whether sureties are necessary. Except in the case of a charitable trust, the court may modify or terminate a bond at any time.

Sec. 53. (NEW) (Effective October 1, 2018) (a) Cotrustees who are unable to reach a unanimous decision may act by majority decision.

(b) If a vacancy occurs in a cotrusteeship, the remaining cotrustees may act for the trust.

(c) Subject to the provisions of section 98 of this act, a cotrustee shall participate in the performance of a trustee's function unless the cotrustee is unavailable to perform the function because of absence, illness, disqualification under other law or other temporary incapacity or the cotrustee has properly delegated the performance of the function to another trustee.

(d) If a cotrustee is unavailable to perform duties because of absence, illness, disqualification under other law or other temporary incapacity, and prompt action is necessary to achieve the purposes of the trust or to avoid injury to the trust property, the remaining cotrustee or a majority of the remaining cotrustees may act for the trust.

(e) A trustee may delegate to a cotrustee the performance of any function other than a function that the terms of the trust expressly require to be performed by the trustees jointly. Unless a delegation was irrevocable, a delegating trustee may revoke a delegation previously made.

(f) Except as provided in subsection (g) of this section, a trustee who does not join in an action of another trustee is not liable for the action.

(g) Subject to the provisions of section 98 of this act, each trustee shall exercise reasonable care to: (1) Prevent a cotrustee from committing a serious breach of trust; and (2) compel a cotrustee to redress a serious breach of trust.

(h) A dissenting trustee who joins in an action at the direction of the majority of the trustees and who notified any cotrustee of the dissent at or before the time of the action is not liable for the action unless the action is a serious breach of trust.

Sec. 54. (NEW) (Effective October 1, 2018) (a) A vacancy in a trusteeship occurs if: (1) A person designated as trustee rejects the trusteeship; (2) a person designated as trustee cannot be identified or does not exist; (3) a trustee resigns; (4) a trustee is disqualified or removed; (5) a trustee dies; or (6) a conservator is appointed for an individual serving as trustee.

(b) If one or more cotrustees remain in office, a vacancy in a trusteeship of a noncharitable trust need not be filled, unless otherwise required by the terms of the trust. A vacancy in a trusteeship shall be filled if the trust has no remaining trustee. A vacancy in a trusteeship of a charitable trust shall be filled, unless otherwise excused by the terms of the trust.

(c) A vacancy in a trusteeship required to be filled shall be filled in the following order of priority: (1) By a person designated in the terms of the trust to act as successor trustee or appointed according to a procedure specified in such terms; (2) in the case of a noncharitable trust, by a person appointed by unanimous agreement of the qualified beneficiaries; or (3) by a person appointed by the court.

(d) Whether or not a vacancy in a trusteeship exists or is required to be filled, the court may appoint an additional trustee or special fiduciary whenever the court considers the appointment necessary for the administration of the trust.

Sec. 55. (NEW) (Effective October 1, 2018) (a) A trustee of an inter vivos trust may resign without court approval upon at least thirty days' notice to either: (1) The qualified beneficiaries, the settlor, if living, and all cotrustees; or (2) the court.

(b) A trustee of a testamentary trust may resign: (1) Without court approval upon at least thirty days' notice to the qualified beneficiaries and the court; or (2) with the approval of the court.

(c) In approving a resignation pursuant to subdivision (2) of subsection (b) of this section, the court may issue orders and impose conditions reasonably necessary for the protection of the trust property, the beneficiaries and the other trustees, and may issue such other orders as law and equity may require.

(d) Any liability of a resigning trustee or of any sureties on such trustee's bond for acts or omissions of such trustee is not discharged or affected by such trustee's resignation.

Sec. 56. (NEW) (Effective October 1, 2018) (a) The settlor of a noncharitable trust, the settlor of a charitable trust who has expressed the right to do so, the Attorney General in the case of a charitable trust, a cotrustee or a beneficiary, may request the court to remove a trustee, or a trustee may be removed by the court on its own initiative.

(b) The court may remove a trustee if:

(1) The trustee has committed a serious breach of trust;

(2) Lack of cooperation among cotrustees substantially impairs the administration of the trust;

(3) Because of unfitness, unwillingness or persistent failure of the trustee to administer the trust effectively, the court determines that removal of the trustee best serves the interests of the beneficiaries; or

(4) There has been a substantial change of circumstances or removal is requested by all of the qualified beneficiaries, the court finds that removal of the trustee best serves the interests of all of the beneficiaries and is not inconsistent with a material purpose of the trust, and a suitable cotrustee or successor trustee is available. A successor corporate fiduciary shall not be removed in such a manner as to discriminate against state banks or national banking associations. No consolidated state bank or national banking association and no receiving state bank or national banking association may be removed solely because it is a successor fiduciary, as defined in section 45a-245a of the general statutes.

Sec. 57. (NEW) (Effective October 1, 2018) (a) Unless a cotrustee remains in office or the court otherwise orders, and until the trust property is delivered to a successor trustee or other person entitled to it, a trustee who has resigned or been removed has the duties of a trustee and the powers necessary to protect the trust property.

(b) A trustee who has resigned or been removed shall proceed expeditiously to deliver the trust property within the trustee's possession to the cotrustee, successor trustee or other person entitled to it.

Sec. 58. (NEW) (Effective October 1, 2018) (a) If the terms of a trust do not specify the trustee's compensation, a trustee is entitled to compensation that is reasonable under the circumstances.

(b) If the terms of a trust specify the trustee's compensation, the trustee is entitled to be compensated as specified, but the court may allow more or less compensation if: (1) The duties of the trustee are substantially different from those contemplated when the trust was created; or (2) the compensation specified by the terms of the trust is unreasonably low or high.

Sec. 59. (NEW) (Effective October 1, 2018) (a) A trustee is entitled to be reimbursed out of the trust property, with interest as appropriate, for: (1) Expenses that were properly incurred in the defense or administration of the trust, unless the trustee is determined to have committed a breach of trust; and (2) to the extent necessary to prevent unjust enrichment of the trust, expenses that were not properly incurred in the administration of the trust.

(b) An advance by the trustee of money for the protection of the trust gives rise to a lien against trust property to secure reimbursement with reasonable interest.

Sec. 60. (NEW) (Effective October 1, 2018) Upon acceptance of a trusteeship, the trustee shall administer the trust in good faith, in accordance with its terms and purposes, settlor's intent and the interests of the beneficiaries, and in accordance with sections 1 to 113, inclusive, of this act.

Sec. 61. (NEW) (Effective October 1, 2018) (a) A trustee shall administer the trust assets solely in the interests of the beneficiaries consistent with the settlor's intent.

(b) Subject to the rights of persons dealing with or assisting the trustee as provided in section 84 of this act, a sale, encumbrance or other transaction involving the investment or management of trust property entered into by the trustee for the trustee's own personal account or which is otherwise affected by a conflict between the trustee's fiduciary and personal interests is voidable by a beneficiary affected by the transaction unless: (1) The transaction was authorized by the terms of the trust; (2) the transaction was approved by the court; (3) the beneficiary did not commence a judicial proceeding within the time allowed by section 77 of this act; (4) the beneficiary consented to the trustee's conduct, ratified the transaction or released the trustee as provided in section 81 of this act; or (5) the transaction involves a contract entered into or claim acquired by the trustee before the person became or contemplated becoming trustee.

(c) A sale, encumbrance or other transaction involving the investment or management of trust property is presumed to be affected by a conflict between personal and fiduciary interests if it is entered into by the trustee with: (1) The trustee's spouse; (2) the trustee's descendants, sibling, parents or their spouses; (3) an agent or attorney of the trustee; or (4) a corporation or other person or enterprise in which the trustee, or a person that owns a significant interest in the trustee, has an interest that might affect the trustee's best judgment.

(d) A transaction between a trustee and a beneficiary that does not concern trust property but that occurs during the existence of the trust or while the trustee retains significant influence over the beneficiary and from which the trustee obtains an advantage is voidable by the beneficiary unless the trustee establishes that the transaction was fair to the beneficiary.

(e) A transaction not concerning trust property in which the trustee engages in the trustee's individual capacity involves a conflict between personal and fiduciary interests if the transaction concerns an opportunity properly belonging to the trust.

(f) The following transactions are not presumed to be affected by a conflict of interest between a trustee's personal and fiduciary interests, provided the transaction and any investment made pursuant to the transaction complies with the Connecticut Uniform Prudent Investor Act, sections 45a-541 to 45a-541l, inclusive, of the general statutes, is in the best interests of the beneficiaries and is not prohibited by the governing instrument: (1) An investment by a trustee in securities of an investment company or investment trust to which the trustee, or its affiliate, provides services in a capacity other than as trustee; (2) an investment by a trustee in an insurance contract purchased from an insurance agency owned by, or affiliated with, the trustee or its affiliate; and (3) the placing of securities transactions by a trustee through a securities broker that is a part of the same company as the trustee, that is owned by the trustee or that is affiliated with the trustee.

(g) In voting shares of stock or in exercising powers of control over similar interests in other forms of enterprise, the trustee shall act in the best interests of the beneficiaries consistent with the intentions of the settlor. If the trust is the sole owner of a corporation or other form of enterprise, the trustee shall elect or appoint directors or other managers who will manage the corporation or enterprise in the best interests of the beneficiaries.

(h) This section shall not preclude the following transactions, if fair to the beneficiaries: (1) An agreement between a trustee and a beneficiary relating to the appointment or compensation of the trustee; (2) payment of reasonable compensation to the trustee; (3) a transaction between a trust and another trust, decedent's estate or conservatorship of which the trustee is a fiduciary or in which a beneficiary has an interest; (4) a deposit of trust money in a regulated financial service institution operated by the trustee; or (5) an advance by the trustee of money for the protection of the trust.

(i) The court may appoint a special fiduciary to make a decision with respect to any proposed transaction that may violate this section if entered into by the trustee.

Sec. 62. (NEW) (Effective October 1, 2018) If a trust has two or more beneficiaries, the trustee shall act impartially in investing, managing and distributing the trust property, giving due regard to the beneficiaries' respective interests.

Sec. 63. (NEW) (Effective October 1, 2018) A trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distributional requirements and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill and caution.

Sec. 64. (NEW) (Effective October 1, 2018) (a) A trustee may delegate duties and powers that a prudent trustee of comparable skills could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill and caution in:

(1) Selecting an agent;

(2) Establishing the scope and terms of the delegation, consistent with the purposes and terms of the trust; and

(3) Periodically reviewing the agent's actions in order to monitor the agent's performance and compliance with the terms of the delegation.

(b) In performing a delegated function, an agent owes a duty to the trust to exercise reasonable care to comply with the terms of the delegation.

(c) A trustee who complies with subsection (a) of this section is not liable to the beneficiaries or to the trust for an action of the agent to whom the function was delegated.

(d) By accepting a delegation of powers or duties from the trustee of a trust that is subject to the law of this state, an agent submits to the jurisdiction of the courts of this state.

Sec. 65. (NEW) (Effective October 1, 2018) In a judicial proceeding involving the administration of a trust, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney's fees, to any party, to be paid by another party or from the trust that is the subject of the controversy.

Sec. 66. (NEW) (Effective October 1, 2018) A trustee shall take reasonable steps to take control of and protect the trust property.

Sec. 67. (NEW) (Effective October 1, 2018) (a) A trustee shall keep adequate records of the administration of the trust.

(b) A trustee shall keep trust property separate from the trustee's own property.

(c) Except as provided in subsection (d) of this section, 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.

(d) If the trustee maintains records clearly indicating the respective interests, a trustee may invest as a whole the property of two or more separate trusts.

Sec. 68. (NEW) (Effective October 1, 2018) A trustee shall take reasonable steps to enforce claims of the trust and to defend claims against the trust.

Sec. 69. (NEW) (Effective October 1, 2018) 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 former trustee.

Sec. 70. (NEW) (Effective October 1, 2018) (a) Unless, under the circumstances, disclosure is unreasonable: (1) A trustee shall keep the qualified beneficiaries of the trust reasonably informed about the administration of the trust and of the material facts necessary for them to protect their interests; and (2) a trustee shall promptly respond to a qualified beneficiary's request for trustee's reports and other information reasonably related to the administration of the trust.

(b) A trustee: (1) Upon request of a qualified beneficiary, shall promptly furnish to the qualified beneficiary a copy of the trust instrument; (2) within sixty days after accepting a trusteeship, shall notify the qualified beneficiaries of the acceptance and of the trustee's name, address and telephone number; and (3) within sixty days 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, shall notify the current beneficiaries of the trust's existence, of the identity of the settlor or settlors, of the right to request a copy of the trust instrument and of the right to trustee's reports.

(c) A trustee shall send a report to the distributees and permissible distributees of trust income or principal, and to other qualified beneficiaries who request it, at least annually and at the termination of the trust. Upon a vacancy in a trusteeship, unless a cotrustee remains in office, the former trustee shall send a report to the distributees and permissible distributees, and to other qualified beneficiaries who request it. An executor, administrator or conservator may send the report on behalf of a deceased or incapacitated trustee. The report may be formal or informal, but shall include information relating to the trust property, liabilities, receipts and disbursements, including the amount of the trustee's compensation, a listing of the trust assets and, if feasible, their respective market values.

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

(e) Judicial approval of a trustee's report forecloses claims as to those given notice of the proceeding as to matters disclosed in the report.

Sec. 71. (NEW) (Effective October 1, 2018) (a) 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, settlor's intent and the interests of the beneficiaries.

(b) Subject to the provisions of subsection (d) of this section, and unless the terms of the trust expressly indicate that a rule in this subsection does not apply: (1) A person, other than a settlor, who is a beneficiary and trustee of a trust that confers on the trustee a power to make discretionary distributions to or for the trustee's personal benefit, may exercise the power only in accordance with an ascertainable standard relating to the trustee's individual health, education, support or maintenance within the meaning of Section 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time; and (2) a trustee may not exercise a power to make discretionary distributions to satisfy a legal obligation of support that the trustee personally owes another person.

(c) A power to make discretionary distributions, the exercise of which is limited or prohibited by subsection (b) of this section, may be exercised by a majority of the remaining trustees whose exercise of such power is not so limited or prohibited. If the exercise of such power by all trustees is so limited or prohibited, the court may appoint a special fiduciary with authority to exercise such power.

(d) Subsection (b) of this section does not apply to: (1) A power held by the settlor's spouse who is the trustee of a trust for which a marital deduction, as defined in Section 2056(b)(5) or 2523(e) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, was previously allowed; (2) any trust during any period that the trust may be revoked or amended by its settlor; or (3) a trust, if contributions to the trust qualify for the annual exclusion under Section 2503(c) of said Internal Revenue Code.

Sec. 72. (NEW) (Effective October 1, 2018) (a) A trustee, without authorization by the court, may exercise: (1) Powers conferred by the terms of the trust; and (2) except as limited by the terms of the trust, (A) all powers over the trust property which an unmarried competent owner has over individually owned property, (B) any other powers appropriate to achieve the proper investment, management and distribution of the trust property, and (C) any other powers conferred by sections 1 to 113, inclusive, of this act.

(b) The exercise of any power is subject to the fiduciary duties prescribed by sections 60 to 74, inclusive, of this act.

Sec. 73. (NEW) (Effective October 1, 2018) (a) Without limiting the authority conferred by section 72 of this act, a trustee may:

(1) Collect trust property and accept or reject additions to the trust property from a settlor or any other person;

(2) Acquire or sell property, for cash or on credit, at public or private sale;

(3) Exchange, partition or otherwise change the character of trust property;

(4) Deposit trust money in an account in a regulated financial service institution;

(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;

(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;

(7) With respect to stocks or other securities, exercise the rights of an absolute owner, including the right to (A) vote or give proxies to vote, with or without power of substitution, or enter into or continue a voting trust agreement, (B) hold a security in the name of a nominee or in other form without disclosure of the trust so that title may pass by delivery, (C) pay calls, assessments and other sums chargeable or accruing against the securities, and sell or exercise stock subscription or conversion rights, and (D) deposit the securities with a depositary or other regulated financial service institution;

(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;

(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;

(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;

(11) Insure the property of the trust against damage or loss and insure the trustee, the trustee's agents and beneficiaries against liability arising from the administration of the trust;

(12) Abandon or decline to administer property of no value or of insufficient value to justify its collection or continued administration;

(13) With respect to possible liability for violation of environmental law, (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, (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, (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, (D) compromise claims against the trust which may be asserted for an alleged violation of environmental law, and (E) pay the expense of any inspection, review, abatement or remedial action to comply with environmental law;

(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;

(15) Pay taxes, assessments, compensation of the trustee and of employees and agents of the trust, and other expenses incurred in the administration of the trust;

(16) Exercise elections with respect to federal, state and local taxes;

(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;

(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, with the trustee having a lien on future distributions for repayment of such loans;

(19) Pledge trust property to guarantee loans made by others to the beneficiary;

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

(21) Pay an amount distributable to a beneficiary who is under a legal disability or who the trustee reasonably believes is incapacitated, by: (A) Paying it directly to the beneficiary or applying it for the beneficiary's benefit; (B) paying it to the beneficiary's conservator or, if the beneficiary does not have a conservator, the beneficiary's guardian; (C) paying it to the beneficiary's custodian under the Connecticut Uniform Transfers to Minors Act or to the beneficiary's custodial trustee under the Uniform Custodial Trust Act, and, for such purpose, creating a custodianship or custodial trust; (D) if the trustee does not know of a conservator, custodian or custodial trustee, paying it to an adult relative or other person having legal or physical care or custody of the beneficiary, to be expended on the beneficiary's behalf; or (E) managing it as a separate fund on the beneficiary's behalf, subject to the beneficiary's continuing right to withdraw the distribution;

(22) On distribution of trust property or the division or termination of a trust, make distributions in divided or undivided interests, allocate particular assets in proportionate or disproportionate shares, value the trust property for such purposes and adjust for resulting differences in valuation;

(23) Resolve a dispute concerning the interpretation of the trust or its administration by mediation, arbitration or other procedure for alternative dispute resolution;

(24) Prosecute or defend an action, claim or judicial proceeding in any jurisdiction to protect trust property and the trustee in the performance of the trustee's duties;

(25) Sign and deliver contracts and other instruments that are useful to achieve or facilitate the exercise of the trustee's powers; and

(26) On termination of the trust, exercise the powers appropriate to wind up the administration of the trust and distribute the trust property to the persons entitled to it.

(b) The foregoing powers shall not apply to a charitable trust to the extent that their exercise would give the trustee the authority to deviate from a stated charitable purpose or violate a restricted gift.

Sec. 74. (NEW) (Effective October 1, 2018) (a) Upon termination or partial termination of a trust, the trustee of an inter vivos trust may send to the qualified beneficiaries a proposal for distribution. The right of any beneficiary, to whom the trustee has sent the proposal, to object to the proposed distribution terminates if the beneficiary does not notify the trustee of an objection not later than thirty days after the date on which the proposal was sent, but only if the proposal informed the beneficiary of the right to object and of the time allowed for objection.

(b) Upon the occurrence of an event terminating or partially terminating a trust, the trustee shall proceed expeditiously to distribute the trust property to the persons entitled to it, subject to the right of the trustee to retain a reasonable reserve for the payment of debts, expenses and taxes.

(c) A release by a beneficiary of a trustee from liability for breach of trust is invalid to the extent: (1) It was induced by improper conduct of the trustee; or (2) the beneficiary, at the time of the release, did not know of the beneficiary's rights or of the material facts relating to the breach.

Sec. 75. (NEW) (Effective October 1, 2018) A violation by a trustee of a duty the trustee owes to a beneficiary is a breach of trust.

Sec. 76. (NEW) (Effective October 1, 2018) (a) A trustee is accountable to an affected beneficiary for any profit made by the trustee arising from the administration of the trust, even absent a breach of trust.

(b) Absent a breach of trust, a trustee is not liable to a beneficiary for a loss or depreciation in the value of trust property or for not having made a profit.

Sec. 77. (NEW) (Effective October 1, 2018) (a) A beneficiary may not commence a proceeding against a trustee for breach of trust more than one year after the date on which the beneficiary or a representative of the beneficiary was sent a report that adequately disclosed the existence of a potential claim for breach of trust and informed the beneficiary of the time allowed for commencing a proceeding.

(b) A report adequately discloses the existence of a potential claim for breach of trust if it provides sufficient information so that the beneficiary or representative knows of the potential claim or should have inquired into its existence.

(c) If subsection (a) of this section does not apply, a judicial proceeding by a beneficiary against a trustee for breach of trust shall be commenced not later than two years after the first to occur of: (1) The removal, resignation or death of the trustee; (2) the termination of the beneficiary's interest in the trust; or (3) the termination of the trust.

(d) In a proceeding involving a charitable trust, any notice that is required to be given to the Attorney General shall include a copy of the trust instrument.

Sec. 78. (NEW) (Effective October 1, 2018) A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from the reliance.

Sec. 79. (NEW) (Effective October 1, 2018) If the happening of an event, including marriage, divorce, performance of educational requirements or death, affects the administration or distribution of a trust, a trustee who has exercised reasonable care to ascertain the happening of the event is not liable for a loss resulting from the trustee's lack of knowledge.

Sec. 80. (NEW) (Effective October 1, 2018) (a) A term of a trust relieving a trustee of liability for breach of trust is unenforceable to the extent that it: (1) Relieves the trustee of liability for breach of trust committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries; or (2) was inserted as the result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.

(b) Except for terms intended to provide protection for carrying out a stated trust purpose, an exculpatory term drafted or caused to be drafted by the trustee is invalid as an abuse of a fiduciary or confidential relationship unless the trustee proves that the exculpatory term is fair under the circumstances and that its existence and contents were adequately communicated to the settlor.

Sec. 81. (NEW) (Effective October 1, 2018) A trustee is not liable to a beneficiary for breach of trust if the beneficiary consented to the conduct constituting the breach, released the trustee from liability for the breach or ratified the transaction constituting the breach, unless: (1) The consent, release or ratification of the beneficiary was induced by improper conduct of the trustee; or (2) at the time of the consent, release or ratification, the beneficiary did not know of the beneficiary's rights or of the material facts relating to the breach.

Sec. 82. (NEW) (Effective October 1, 2018) (a) Except as otherwise provided in the contract, a trustee is not personally liable on a contract properly entered into in the trustee's fiduciary capacity in the course of administering the trust if the trustee in the contract disclosed the fiduciary capacity.

(b) Except as otherwise limited by the general statutes, a trustee is personally liable for torts committed in the course of administering a trust or for obligations arising from ownership or control of trust property, including liability for violation of environmental law, only if the trustee is personally at fault.

(c) A claim based on (1) a contract entered into by a trustee in the trustee's fiduciary capacity, (2) an obligation arising from ownership or control of trust property, or (3) a tort committed in the course of administering a trust, may be asserted in a judicial proceeding against the trustee in the trustee's fiduciary capacity, whether or not the trustee is personally liable for the claim.

Sec. 83. (NEW) (Effective October 1, 2018) (a) Except as provided in subsection (c) of this section or unless personal liability is imposed in the contract, a trustee who holds an interest as a general partner in a general or limited partnership is not personally liable on a contract entered into by the partnership after the trust's acquisition of the interest if the fiduciary capacity was disclosed in the contract or in a statement previously filed pursuant to the Uniform Partnership Act, sections 34-300 to 34-399, inclusive, of the general statutes, or the Uniform Limited Partnership Act, sections 34-9 to 34-38u, inclusive, of the general statutes.

(b) Except as otherwise provided in subsection (c) of this section, a trustee who holds an interest as a general partner is not personally liable for torts committed by the partnership or for obligations arising from ownership or control of the interest unless the trustee is personally at fault.

(c) The immunity provided by this section does not apply if an interest in the partnership is held by the trustee in a capacity other than that of trustee or is held by the trustee's spouse or one or more of the trustee's descendants, siblings or parents or the spouse of any of them.

(d) If the trustee of a revocable trust holds an interest as a general partner, the settlor is personally liable for contracts and other obligations of the partnership as if the settlor were a general partner.

Sec. 84. (NEW) (Effective October 1, 2018) (a) A person other than a beneficiary who in good faith assists a trustee, or who in good faith and for value deals with a trustee, without knowledge that the trustee is exceeding or improperly exercising the trustee's powers, is protected from liability as if the trustee properly exercised the power.

(b) A person other than a beneficiary who in good faith deals with a trustee is not required to inquire into the extent of the trustee's powers or the propriety of their exercise.

(d) A person other than a beneficiary who in good faith assists a former trustee, or who in good faith and for value deals with a former trustee, without knowledge that the trusteeship has terminated, is protected from liability as if the former trustee were still a trustee.

(e) Comparable protective provisions of other laws relating to commercial transactions or transfer of securities by fiduciaries prevail over the protection provided by this section.

Sec. 85. (NEW) (Effective October 1, 2018) (a) Instead of furnishing a copy of the trust instrument to a person other than a beneficiary or, in the case of a charitable trust, the Attorney General's office, the trustee may furnish to the person or said office a certification of trust containing the following information: (1) That the trust exists and the date the trust instrument was executed; (2) the identity of the settlor; (3) the identity and address of the currently acting trustee; (4) the powers of the trustee; (5) the revocability or irrevocability of the trust and the identity of any person holding a power to revoke the trust; (6) the authority of cotrustees to sign or otherwise authenticate, and whether all or less than all are required in order to exercise powers of the trustee; (7) the trust's taxpayer identification number; and (8) the manner of taking title to trust property.

(b) A certification of trust may be signed or otherwise authenticated by any trustee.

(c) A certification of trust shall state that the trust has not been revoked, modified or amended in any manner that would cause the representations contained in the certification of trust to be incorrect.

(d) A certification of trust need not contain the dispositive terms of a trust.

(e) A recipient of a certification of trust may require the trustee to furnish copies of those excerpts from the original trust instrument and later amendments which designate the trustee and confer upon the trustee the power to act in the pending transaction.

(f) A person who acts in reliance upon a certification of trust without knowledge that the representations contained therein are incorrect is not liable to any person for so acting and may assume without inquiry the existence of the facts contained in the certification. Knowledge of the terms of the trust may not be inferred solely from the fact that a copy of all or part of the trust instrument is held by the person relying upon the certification.

(g) A person who in good faith enters into a transaction in reliance upon a certification of trust may enforce the transaction against the trust property as if the representations contained in the certification were correct.

(h) A person making a demand for the trust instrument in addition to a certification of trust or excerpts is liable for damages if the court determines that the person did not act in good faith in demanding the trust instrument.

(i) This section shall not limit the right of a person to obtain a copy of the trust instrument in a judicial proceeding concerning the trust, and shall not in any way limit the rights of the Attorney General to notice under subsection (d) of section 77 of this act.

Sec. 86. (NEW) (Effective October 1, 2018) In applying and construing the uniform provisions of sections 1 to 87, inclusive, of this act, consideration shall be given to the need to promote uniformity of the law with respect to the subject matter among states that enact such uniform provisions.

Sec. 87. (NEW) (Effective October 1, 2018) If any provision of this section or sections 1 to 86, inclusive, of this act or its application to any person or circumstances is held invalid, the invalidity does not affect other provisions or applications of this section or sections 1 to 86, inclusive, of this act which can be given effect without the invalid provision or application, and to this end the provisions of this section and sections 1 to 86, inclusive, of this act are severable.

Sec. 88. (NEW) (Effective October 1, 2018) This section and sections 89 to 105, inclusive, of this act may be cited as the "Connecticut Uniform Directed Trust Act."

Sec. 89. (NEW) (Effective October 1, 2018) Sections 88 to 105, inclusive, of this act apply to a trust, whenever created, that has its principal place of administration in this state, subject to the following rules:

(1) If the trust was created before October 1, 2018, sections 88 to 105, inclusive, of this act apply only to a decision or action occurring on or after October 1, 2018.

(2) If the principal place of administration of the trust is changed to this state on or after October 1, 2018, sections 88 to 105, inclusive, of this act apply only to a decision or action occurring on or after the date of the change.

Sec. 90. (NEW) (Effective October 1, 2018) The common law and principles of equity supplement sections 88 to 105, inclusive, of this act, except to the extent modified by sections 88 to 105, inclusive, of this act or law of this state other than sections 88 to 105, inclusive, of this act.

Sec. 91. (NEW) (Effective October 1, 2018) (a) As used in this section, "power of appointment" means a power that enables a person acting in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of appointment over trust property.

(b) Sections 88 to 105, inclusive, of this act do not apply to a:

(1) Power of appointment;

(2) Power to appoint or remove a trustee or trust director;

(3) Power of a settlor over a trust to the extent the settlor has a power to revoke the trust;

(4) Power of a beneficiary over a trust to the extent the exercise or nonexercise of the power affects the beneficial interest of:

(A) The beneficiary; or

(B) Another beneficiary represented by the beneficiary under sections 17 to 21, inclusive, of this act with respect to the exercise or nonexercise of the power; or

(5) Power over a trust if:

(A) The terms of the trust provide that the power is held in a nonfiduciary capacity; and

(B) The power is held in a nonfiduciary capacity to achieve the settlor's tax objectives under the United States Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time.

(c) Unless the terms of a trust provide otherwise, a power granted to a person to designate a recipient of an ownership interest in or power of appointment over trust property which is exercisable while the person is not serving as a trustee is a power of appointment and not a power of direction.

Sec. 92. (NEW) (Effective October 1, 2018) (a) Subject to section 93 of this act, the terms of a trust may grant a power of direction to a trust director.

(b) Unless the terms of a trust provide otherwise: (1) A trust director may exercise any further power appropriate to the exercise or nonexercise of a power of direction granted to the director under subsection (a) of this section; and (2) trust directors with joint powers shall act by majority decision.

Sec. 93. (NEW) (Effective October 1, 2018) A trust director is subject to the same rules as a trustee in a like position and under similar circumstances in the exercise or nonexercise of a power of direction or further power under subdivision (1) of subsection (b) of section 92 of this act regarding:

(1) A payback provision in the terms of a trust necessary to comply with the reimbursement requirements of 42 USC 1396p(d)(4)(A), as amended from time to time; and

(2) A charitable interest in the trust, including notice regarding the interest to the Attorney General.

Sec. 94. (NEW) (Effective October 1, 2018) (a) Subject to the provisions of subsection (b) of this section, with respect to a power of direction or further power under subdivision (1) of subsection (b) of section 92 of this act:

(1) A trust director has the same fiduciary duty and liability in the exercise or nonexercise of the power:

(A) If the power is held individually, as a sole trustee in a like position and under similar circumstances; or

(B) If the power is held jointly with a trustee or another trust director, as a cotrustee in a like position and under similar circumstances; and

(2) The terms of the trust may vary the director's duty or liability to the same extent the terms of the trust could vary the duty or liability of a trustee in a like position and under similar circumstances.

(b) Unless the terms of a trust provide otherwise, if a trust director is licensed, certified, or otherwise authorized or permitted by law other than sections 88 to 105, inclusive, of this act to provide health care in the ordinary course of the director's business or practice of a profession, to the extent the director acts in that capacity, the director has no duty or liability under sections 88 to 105, inclusive, of this act.

(c) The terms of a trust may impose a duty or liability on a trust director in addition to the duties and liabilities under this section.

Sec. 95. (NEW) (Effective October 1, 2018) (a) Subject to the provisions of subsection (b) of this section, a directed trustee shall take reasonable action to comply with a trust director's exercise or nonexercise of a power of direction or further power under subdivision (1) of subsection (b) of section 92 of this act, and the trustee is not liable for the action.

(b) A directed trustee must not comply with a trust director's exercise or nonexercise of a power of direction or further power under subdivision (1) of subsection (b) of section 92 of this act to the extent that by complying the trustee would engage in wilful misconduct.

(c) An exercise of a power of direction under which a trust director may release a trustee or another trust director from liability for breach of trust is not effective if: (1) The breach involved the trustee's or other director's wilful misconduct; (2) the release was induced by improper conduct of the trustee or other director in procuring the release; or (3) at the time of the release, the director did not know the material facts relating to the breach.

(d) A directed trustee that has reasonable doubt about its duty under this section may petition the court for instructions.

(e) The terms of a trust may impose a duty or liability on a directed trustee in addition to the duties and liabilities under this section.

Sec. 96. (NEW) (Effective October 1, 2018) (a) Subject to the provisions of section 97 of this act, a trustee shall provide information to a trust director to the extent the information is reasonably related to: (1) The powers or duties of the trustee; and (2) the powers or duties of the director.

(b) Subject to the provisions of section 97 of this act, a trust director shall provide information to a trustee or another trust director to the extent the information is reasonably related to: (1) The powers or duties of the director; and (2) the powers or duties of the trustee or other director.

(c) A trustee that acts in reliance on information provided by a trust director is not liable for a breach of trust to the extent the breach resulted from the reliance, unless by so acting the trustee engages in wilful misconduct.

(d) A trust director that acts in reliance on information provided by a trustee or another trust director is not liable for a breach of trust to the extent the breach resulted from the reliance, unless by so acting the trust director engages in wilful misconduct.

Sec. 97. (NEW) (Effective October 1, 2018) (a) Unless the terms of a trust provide otherwise: (1) A trustee does not have a duty to: (A) Monitor a trust director; or (B) inform or give advice to a settlor, beneficiary, trustee or trust director concerning an instance in which the trustee might have acted differently than the director; and (2) by taking an action described in subdivision (1) of this subsection, a trustee does not assume the duty excluded in said subdivision.

(b) Unless the terms of a trust provide otherwise: (1) A trust director does not have a duty to: (A) Monitor a trustee or another trust director; or (B) inform or give advice to a settlor, beneficiary, trustee or another trust director concerning an instance in which the director might have acted differently than a trustee or another trust director; and (2) by taking an action described in subdivision (1) of this subsection, a trust director does not assume the duty excluded by said subdivision.

Sec. 98. (NEW) (Effective October 1, 2018) The terms of a trust may relieve a cotrustee from duty and liability with respect to another cotrustee's exercise or nonexercise of a power of the other cotrustee to the same extent that in a directed trust a directed trustee is relieved from duty and liability with respect to a trust director's power of direction under sections 95 to 97, inclusive, of this act.

Sec. 99. (NEW) (Effective October 1, 2018) (a) An action against a trust director for breach of trust must be commenced within the same limitation period as under section 77 of this act for an action for breach of trust against a trustee in a like position and under similar circumstances.

(b) A report or accounting has the same effect on the limitation period for an action against a trust director for breach of trust that the report or accounting would have under section 77 of this act in an action for breach of trust against a trustee in a like position and under similar circumstances.

Sec. 100. (NEW) (Effective October 1, 2018) In an action against a trust director for breach of trust, the director may assert the same defenses a trustee in a like position and under similar circumstances could assert in an action for breach of trust against the trustee.

Sec. 101. (NEW) (Effective October 1, 2018) (a) By accepting appointment as a trust director of a trust subject to sections 88 to 105, inclusive, of this act, the director submits to personal jurisdiction of the courts of this state regarding any matter related to a power or duty of the director.

(b) This section does not preclude other methods of obtaining jurisdiction over a trust director.

Sec. 102. (NEW) (Effective October 1, 2018) Unless the terms of a trust provide otherwise, the rules applicable to a trustee apply to a trust director regarding the following matters:

(1) Acceptance under section 51 of this act;

(2) Giving of bond to secure performance under section 52 of this act;

(3) Reasonable compensation under section 58 of this act;

(4) Resignation under section 55 of this act;

(5) Removal under section 56 of this act; and

(6) Vacancy and appointment of successor under section 54 of this act.

Sec. 103. (NEW) (Effective October 1, 2018) In applying and construing the uniform provisions of sections 88 to 105, inclusive, of this act, consideration shall be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

Sec. 104. (NEW) (Effective October 1, 2018) Sections 88 to 105, inclusive, of this act modify, limit or supersede the Electronic Signatures in Global and National Commerce Act, 15 USC 7001 et seq., but do not modify, limit or supersede Section 101(c) of said act, 15 USC Section 7001(c), or authorize electronic delivery of any of the notices described in Section 103(b) of said act, 15 USC 7003(b).

Sec. 105. (NEW) (Effective October 1, 2018) The provisions of this section and sections 88 to 104, inclusive, of this act governing the legal effect, validity or enforceability of electronic records or electronic signatures, and of contracts formed or performed with the use of such records or signatures, conform to the requirements of Section 102 of the Electronic Signatures in Global and National Commerce Act, 15 USC 7002 and supersede, modify and limit the requirements of said act.

Sec. 106. (NEW) (Effective October 1, 2018) This section and sections 107 to 112, inclusive, of this act may be cited as the "Connecticut Qualified Dispositions in Trust Act".

Sec. 107. (NEW) (Effective October 1, 2018) As used in sections 106 to 112, inclusive, of this act:

(1) "Claim" means a right to payment, whether or not the right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal equitable, secured or unsecured.

(2) "Creditor" means, with respect to a transferor, a person who has a claim.

(3) "Debt" means liability on a claim.

(4) "Disposition" means a transfer, conveyance or assignment of property, including a change in the legal ownership of property occurring upon the substitution of one trustee for another or the addition of one or more new trustees, or the exercise of a power so as to cause a transfer of property, to a trustee or trustees. "Disposition" does not include the release or relinquishment of an interest that was the subject of a qualified disposition.

(5) "Property" includes real property, tangible and intangible personal property, and interests in real or personal property, tangible and intangible.

(6) "Qualified disposition" means a disposition by or from a transferor to a trustee, with or without consideration, by means of a trust instrument. "Qualified disposition" does not include a disposition: (A) In derogation of any state or federal agency claim or right of recovery under Subchapter XIX of Chapter 7 of Title 42 of the United States Code against a trust established by a transferor or such transferor's spouse, or (B) in respect to a state or federal agency treatment of the trust instrument in a determination of a transferor's eligibility under a state plan under Subchapter XIX of Chapter 7 of Title 42 of the United States Code.

(7) "Spouse" and "former spouse" means only persons to whom the transferor was married at, or before, the time the qualified disposition is made.

(8) "Transferor" means a natural person who, or entity which, as an owner of property or as a holder of a general power of appointment, which authorizes the holder to appoint in favor of the holder, the holder's creditors, the holder's estate or the creditors of the holder's estate, or as a trustee, directly or indirectly, makes a disposition or causes a disposition to be made.

(9) "Qualified trustee" means:

(A) Any person, other than the transferor, who in the case of a natural person, is a resident of this state or who, in all other cases, is a state or federally chartered bank or trust company having a place of business in this state, is authorized to engage in a trust business in this state, and maintains or arranges for custody in this state of some or all of the property that is the subject of the qualified disposition, maintains records in this state for the trust on an exclusive or nonexclusive basis, prepares or arranges for the preparation in this state of fiduciary income tax returns for the trust, or otherwise materially participates in this state in the administration of the trust.

(B) "Qualified trustee" does not include either the transferor or any other natural person who is a nonresident of this state nor an entity that is not authorized by the law of this state to act as a trustee or whose activities are not subject to supervision as provided in subparagraph (A) of this subdivision, provided sections 106 to 112, inclusive, of this act shall not be construed to preclude a transferor from appointing one or more advisors, including, but not limited to:

(i) Advisors who have authority under the terms of the trust instrument to remove and appoint qualified trustees or trust advisors; and

(ii) Advisors who have authority under the terms of the trust instrument to direct, consent to or disapprove distributions from the trust. For purposes of this subparagraph and subparagraph (C) of this subdivision, "advisor" includes a trust "protector" or any other person who, in addition to a qualified trustee, holds one or more trust powers.

(C) A person may serve as an advisor, notwithstanding that such person is the transferor of the qualified disposition, but such a person may not otherwise serve as advisor of a trust that is a qualified disposition except with respect to the retention of the veto right permitted by subparagraph (B) of subdivision (10) of this section.

(D) In the event that a qualified trustee of a trust ceases to meet the requirements of subparagraph (A) of this subdivision and there remains no trustee that meets such requirements, such qualified trustee shall be deemed to have resigned as of the time of such cessation, and thereupon the successor qualified trustee provided for in the trust instrument shall become a qualified trustee of the trust, or in the absence of any successor qualified trustee provided for in the trust amendment, the Superior Court or the Probate Court, if the trust is otherwise subject to the jurisdiction of the Probate Court, or with respect to an inter vivos trust, if the trust is or could be subject to the jurisdiction of the Probate Court for an accounting pursuant to section 45a-175 of the general statutes, provided such an accounting need not be required, shall have jurisdiction, upon application of any interested party, to appoint a successor qualified trustee.

(E) In the case of a disposition to more than one trustee, a disposition that is otherwise a qualified disposition shall not be treated as other than a qualified disposition solely because not all of the trustees are qualified trustees.

(10) "Trust instrument" means an instrument, in writing, appointing a qualified trustee or qualified trustees for the property that is the subject of a disposition, which instrument:

(A) Expressly provides that the laws of this state govern the validity, construction and administration of the trust, provided a disposition by a trustee who is not a qualified trustee to a trustee who is a qualified trustee will not fail to qualify as a qualified disposition solely because the trust instrument does not contain such an express provision;

(B) Is irrevocable, provided a trust instrument shall not be deemed revocable due to inclusion in the trust instrument of one or more of the following:

(i) A transferor's power to veto a distribution from the trust;

(ii) A power of appointment, other than a power to appoint to the transferor, the transferor's creditors, the transferor's estate or the creditors of the transferor's estate, exercisable by will or other written instrument of the transferor effective only upon the transferor's death;

(iii) The transferor's potential or actual receipt of income, including rights to such income retained in the trust instrument;

(iv) The transferor's potential or actual receipt of income or principal from a charitable remainder unitrust or charitable remainder annuity trust as such terms are defined in 26 USC 664, as from time to time amended; and the transferor's right, at any time and from time to time by written instrument delivered to the trustee, to release such transferor's retained interest in such a trust, in whole or in part, in favor of a charitable organization that has or charitable organizations that have a succeeding beneficial interest in such trust;

(v) The transferor's receipt each year of a percentage, not to exceed five per cent, specified in the trust instrument of the initial value of the trust assets on their value determined from time to time pursuant to the trust instrument or of a fixed amount that, on an annual basis, does not exceed five per cent of the initial value of the trust assets;

(vi) The transferor's potential or actual receipt or use of principal if such potential or actual receipt or use of principal would be the result of a qualified trustee's or qualified trustees' acting:

(I) In such qualified trustee's or qualified trustees' discretion;

(II) Pursuant to a standard that governs the distribution of principal and does not confer upon the transferor a substantially unfettered right to the receipt or use of the principal; or

(III) At the direction of an advisor described in subdivision (9) of this section who is acting in such advisor's discretion, or pursuant to a standard that governs the distribution of principal and does not confer upon the transferor a substantially unfettered right to the receipt of or use of principal. For purposes of this subclause, a qualified trustee is presumed to have discretion with respect to the distribution of principal unless such discretion is expressly denied to such trustee by the terms of the trust instrument;

(vii) The transferor's right to remove a trustee or advisor and to appoint a new trustee or advisor, other than a person who is a related or subordinate party with respect to the transferor within the meaning of 26 USC 672(c), as amended from time to time;

(viii) The transferor's potential or actual use of real property held under a qualified personal residence trust within the meaning of such term as described in 26 USC 2702(c), as amended from time to time, or the transferor's possession and enjoyment of a qualified annuity interest within the meaning of such term as described in 26 CFR 25.2502-5(c)(8), as amended from time to time; and

(ix) The transferor's potential or actual receipt of income or principal to pay, in whole or in part, income taxes due on income of the trust if such potential or actual receipt of income or principal is pursuant to a provision in the trust instrument that expressly provides for the payment of such taxes and if such potential or actual receipt of income or principal would be the result of a qualified trustee's or qualified trustees' acting:

(I) In such qualified trustee's or qualified trustees' discretion; or

(II) At the direction of an advisor described in subdivision (9) of this section who is acting in such advisor's discretion. Distributions to pay income taxes made under discretion included in a governing instrument pursuant to this clause or clause (iii) or (vi) of this subparagraph may be made by direct payment to the taxing authorities; and

(C) Provides that the interest of the transferor or other beneficiary in the trust property or the income therefrom may not be transferred, assigned, pledged or mortgaged, whether voluntarily or involuntarily, before the qualified trustee or qualified trustees actually distribute the property or income therefrom to the beneficiary, and such provision of the trust instrument shall be deemed to be a restriction on the transfer of the transferor's beneficial interest in the trust that is enforceable under applicable nonbankruptcy law within the meaning of 11 USC 541(c)(2), as amended from time to time.

Sec. 108. (NEW) (Effective October 1, 2018) A qualified disposition shall be subject to sections 106 to 112, inclusive, of this act notwithstanding a transferor's retention of any or all of the powers and rights described in subparagraph (B) of subdivision (10) of section 107 of this act and the transferor's service as investment advisor pursuant to subdivision (9) of section 107 of this act. The transferor shall have only such powers and rights as are conferred by the trust instrument. Except as permitted by subparagraph (D) of subdivision (9) of section 107 of this act and in subparagraph (B) of subdivision (10) of section 107 of this act, a transferor shall have no rights or authority with respect to the property that is the subject of a qualified disposition or the income therefrom, and any agreement or understanding purporting to grant or permit the retention of any greater rights or authority shall be void.

Sec. 109. (NEW) (Effective October 1, 2018) (a) Notwithstanding any provision of the general statutes, no action of any kind, including, without limitation, an action to enforce a judgment entered by a court or other body having adjudicative authority, shall be brought at law or in equity for an attachment or other provisional remedy against property that is the subject of a qualified disposition or for avoidance of a qualified disposition, unless such action is brought pursuant to the provisions of section 52-552h of the general statutes. In any such action, the burden to prove each element by clear and convincing evidence shall be on the creditor.

(b) Notwithstanding the provisions of section 52-552j of the general statutes, a creditor may not bring an action under subsection (a) of this section if:

(1) The creditor's claim against the transferor arose before the qualified disposition was made, unless the action is brought within four years after the qualified disposition is made or, if later, within one year after the qualified disposition was or could reasonably have been discovered by the creditor; or

(2) The creditor's claim against the transferor arose subsequent to the qualified disposition, unless the action is brought within four years after the qualified disposition is made.

(c) For the purposes of sections 106 to 112, inclusive, of this act, a qualified disposition that is made by means of a disposition by a transferor who is a trustee shall be deemed to have been made as of the time the property that is the subject of the qualified disposition was originally transferred to the transferor, or any predecessor trustee, making the qualified disposition in a form that conforms with the requirements set forth in subdivision (10) of section 107 of this act. If a trustee of an existing trust proposes to make a qualified disposition pursuant to the provisions of this subsection, but the trust would not conform to the requirements of subdivision (10) of section 107 of this act as a result of the original transferor's nonconforming powers of appointment, then, upon the trustee's delivery to the qualified trustee of an irrevocable written election to have this subsection apply to the trust, the nonconforming powers of appointment shall be deemed modified to the extent necessary to conform with subdivision (10) of section 107 of this act. For purposes of sections 106 to 112, inclusive, of this act, the irrevocable written election shall include a description of the original transferor's powers of appointment as modified together with the original transferor's written consent thereto, but no such consent of the original transferor shall be considered a disposition within the meaning of subdivision (4) of section 107 of this act.

(d) Notwithstanding any provision of the general statutes, a creditor, including a creditor whose claim arose before or after a qualified disposition, or any other person shall have only such rights with respect to a qualified disposition as are provided in this section and sections 110 and 111 of this act, and no such creditor nor any other person shall have any claim or cause of action against the trustee, or an advisor, as described in subdivision (9) of section 107 of this act, of a trust that is the subject of a qualified disposition, or against any person involved in the counseling, drafting, preparation, execution or funding of a trust that is the subject of a qualified disposition.

(e) Notwithstanding any other provision of the general statutes, no action of any kind, including, without limitation, an action to enforce a judgment by a court or other body having adjudicative authority, shall be brought at law or in equity against the trustee, or advisor described in subdivision (9) of section 107 of this act, of a trust that is the subject of the qualified disposition, or against any person involved in the counseling, drafting, preparation, execution or funding of a trust that is the subject of a qualified disposition, if, as of the date such action is brought, an action by a creditor with respect to such qualified disposition would be barred under this section.

(f) If more than one qualified disposition is made by means of the same trust instrument, then:

(1) The making of a subsequent qualified disposition shall be disregarded in determining whether a creditor's claim with respect to a prior qualified disposition is extinguished as provided in subsection (b) of this section; and

(2) Any distribution to a beneficiary shall be deemed to have been made from the latest such qualified disposition.

(g) If, in any action brought against a trustee of a trust that is funded, in whole or in part, by a qualified disposition, a court takes any action whereby such court declines to apply the law of this state in determining the validity, construction or administration of such trust, or the effect of a spendthrift provision thereof, the trustee shall immediately upon such court's action and without the further order of any court, cease in all respects to be a trustee of such trust and (1) a successor trustee shall thereupon succeed as trustee in accordance with the terms of the trust instrument, or (2) if the trust instrument does not provide for a successor trustee and the trust would otherwise be without a trustee, the Superior Court, or the Probate Court having jurisdiction, upon the application of any beneficiary of such trust, shall appoint a successor trustee upon such terms and conditions as it determines to be consistent with the purposes of such trust and the provisions of this section. Upon the trustee's ceasing to be trustee, such trustee shall have no power or authority other than to convey the trust property to the successor trustee named in the trust instrument or appointed by the Superior Court or the Probate Court having jurisdiction in accordance with the provisions of this section.

Sec. 110. (NEW) (Effective October 1, 2018) Notwithstanding the provisions of section 109, of this act, sections 106 to 112, inclusive, of this act, shall not apply to defeat a claim brought by:

(1) Any person to whom the transferor is indebted on or before the date of a qualified disposition on account of an agreement or order of court for the payment of support or alimony in favor of the transferor's spouse, former spouse or children, or for a division or distribution of property in favor of the transferor's spouse or former spouse, but only to the extent of the debt; or

(2) To any person who suffers death, personal injury or property damage on or before the date of a qualified disposition by a transferor, which death, personal injury or property damage is at any time determined to have been caused in whole or in part by the tortious act or omission of either the transferor or by another person for whom the transferor is or was vicariously liable but only to the extent of such claim against such transferor or other person for whom such transferor is or was vicariously liable.

Sec. 111. (NEW) (Effective October 1, 2018) (a) A qualified disposition shall be avoided only to the extent necessary to satisfy the transferor's debt to the creditor at whose instance the disposition had been avoided, together with any costs, including attorney's fees, that the court may allow.

(b) In the event any qualified disposition is avoided pursuant to subsection (a) of this section:

(1) If the court is satisfied that the trustee has not acted in bad faith in accepting or administering the property that is the subject of the qualified disposition:

(A) The trustee shall have a first and paramount lien against the property that is the subject of the qualified disposition in an amount equal to the entire cost, including attorney's fees, properly incurred by the trustee in the defense of the action or proceedings to avoid the qualified disposition;

(B) The qualified disposition shall be avoided subject to the proper fees, costs, preexisting rights, claims and interest of the trustee and of any predecessor trustee that has not acted in bad faith; and

(C) For purposes of this subdivision, it shall be presumed that the trustee did not act in bad faith merely by accepting the property.

(2) If the court is satisfied that a beneficiary of a trust has not acted in bad faith, the avoidance of the qualified disposition shall be subject to the right of the beneficiary to retain any distribution made upon the exercise of a trust power or discretion vested in the trustee of the trust, which power or discretion was properly exercised prior to the creditor's commencement of an action to avoid the qualified disposition. For purposes of this subdivision, it shall be presumed that the beneficiary, including a beneficiary who is also a transferor of the trust, did not act in bad faith merely by creating the trust or by accepting a distribution made in accordance with the terms of the trust.

(c) A creditor shall have the burden of proving that a trustee or beneficiary acted in bad faith as set forth in subsection (b) of this section by clear and convincing evidence except, in the case of a beneficiary who is also the transferor, the burden on the creditor shall be to prove that the transferor-beneficiary acted in bad faith by a preponderance of the evidence. The provisions of this subsection shall be construed to provide substantive nonprocedural rights under state law.

(d) For purposes of sections 106 to 111, inclusive, of this act, attachment, garnishment, sequestration or other legal or equitable processes shall be permitted only in those circumstances permitted by the express terms of said sections of this act.

Sec. 112. (NEW) (Effective October 1, 2018) The provisions of this section and sections 107 to 111, inclusive, of this act, shall apply to qualified dispositions made on or after October 1, 2018.

Sec. 113. (NEW) (Effective October 1, 2018) (a) Except as otherwise provided in sections 1 to 112, inclusive, of this act, on October 1, 2018:

(1) Sections 1 to 112, inclusive, of this act, apply to all trusts created before, on or after October 1, 2018;

(2) Sections 1 to 112, inclusive, of this act, apply to all judicial proceedings concerning trusts commenced on or after October 1, 2018;

(3) Sections 1 to 112, inclusive, of this act, apply to judicial proceedings concerning trusts commenced before October 1, 2018, unless the court finds that application of a particular provision of said sections of this act would substantially interfere with the effective conduct of the judicial proceedings or prejudice the rights of the parties, in which case the particular provision of sections 1 to 112, inclusive, of this act shall not apply and the superseded law applies;

(4) Any rule of construction or presumption provided in sections 1 to 112, inclusive, of this act, applies to trust instruments executed before October 1, 2018, unless there is a clear indication of a contrary intent in the terms of the trust;

(5) An act done before October 1, 2018, is not affected by sections 1 to 122, inclusive, of this act;

(6) The ninety-year period specified in subdivision (1) of section 29 of this act shall only apply to trusts that become irrevocable on or after October 1, 2018;

(7) The provisions of subdivision (4) of subsection (a) of section 43 of this act shall only apply to revocable trusts of settlors dying on or after October 1, 2018; and

(8) The provisions of subdivision (2) of subsection (a) of section 70 of this act, and subsections (b) and (c) of section 70 of this act, shall only apply to trusts that become irrevocable on or after October 1, 2018.

(b) If a right is acquired, extinguished or barred upon the expiration of a prescribed period that has commenced to run under any provision of the general statutes, other than sections 1 to 112, inclusive, of this act before October 1, 2018, such provision of the general statutes continues to apply to the right even if such provision has been repealed or superseded.

Sec. 114. Section 45a-490 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018):

(a) Sections 45a-490 to 45a-496, inclusive, may be cited as the ["Uniform Statutory Rule Against Perpetuities"] "Maximum Duration of Trusts".

(b) Sections 45a-491 to 45a-496, inclusive, apply to all trusts created on or after October 1, 1989, and before October 1, 2018.

Sec. 115. Section 45a-495 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018):

(a) Except as extended by subsection (b) of this section, sections [45a-490 to 45a-496, inclusive, apply to a nonvested property interest or a power of appointment that is created on or after October 1, 1989. For purposes of this section, a nonvested property interest or a power of appointment created by the exercise of a power of appointment is created when the power is irrevocably exercised or when a revocable exercise becomes irrevocable] 45a-491 to 45a-495, inclusive, shall apply to a nonvested property interest or a power of appointment that is created on or after October 1, 1989, and before October 1, 2018. For purposes of this section, a nonvested property interest or a power of appointment created by the exercise of a power of appointment is created when the power is irrevocably exercised or when a revocable exercise becomes irrevocable.

(b) If a nonvested property interest or a power of appointment was created before October 1, 1989, and is determined in a judicial proceeding, commenced on or after October 1, 1989, to violate this state's rule against perpetuities as that rule existed before October 1, 1989, a court upon the petition of an interested person may reform the disposition in the manner that most closely approximates the transferor's manifested plan of distribution and is within the limits of the rule against perpetuities applicable when the nonvested property interest or power of appointment was created.

Sec. 116. (NEW) (Effective October 1, 2018) The common law rule against perpetuities shall not apply to any nonvested property interest or power of appointment created after October 1, 2018, if the trustee or other person to whom the power is properly granted or delegated, has the power under the governing instrument, applicable statute or common law, to sell, mortgage or lease property for any period of time beyond the period that is required for an interest created under the governing instrument to vest in order to be valid had the trust been subject to section 45a-491 of the general statutes. If no person holds such powers, sections 45a-490 to 45a-496, inclusive, of the general statutes, as amended by this act, shall apply to that nonvested property interest or power of appointment.

Sec. 117. Section 45a-482 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018):

When the facts at the time of distribution from an estate to a trust or from a testamentary trust to a successive trust are such that no trust would be operative under the terms of the instrument creating such trust or successive trust because of the death of the life tenant, or because the beneficiary has reached a stipulated age, or if such trust would qualify for termination under section [45a-484] 35 of this act, or for any other reason, the fiduciary of such estate or prior trust may distribute, with the approval of the court of probate having jurisdiction, directly from the estate or prior trust to the remaindermen of such trust, the corpus of such trust and any income earned during the period of estate administration or administration of the prior trust and distributable to such remaindermen, without the interposition of the establishment of such trust or successive trust. If distribution is based on the fact that the trust would qualify for termination under section [45a-484] section 35 of this act, reasonable notice shall be provided to all beneficiaries who are known and in being and who have vested or contingent interests in the trust.

Sec. 118. Section 52-321 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018):

[Except as provided in sections 52-321a and 52-352b:

(a) If property has been given to trustees to pay over the income to any person, without provision for accumulation or express authorization to the trustees to withhold the income, and the income has not been expressly given for the support of the beneficiary or his family, the income shall be liable in equity to the claims of all creditors of the beneficiary.

(b) Any creditor of the beneficiary who has secured a judgment against the beneficiary may bring an action against him and serve the trustees with garnishee process, and the court to which the action is returnable may direct the trustees to pay over the net income derived from the trust estate to the judgment creditor, as the income may accrue, until the creditor's debt is satisfied.

(c) The court having jurisdiction over the fund may make such an order for payment pursuant to subsection (b) when the beneficiary is a nonresident of this state, as well as when the beneficiary is a resident, but in the case of a nonresident beneficiary notice shall be given to the nonresident of the action against him as provided in section 52-87. The nonresidence of the beneficiary shall not deprive the court of authority to make such an order.

(d) If any such trust has been expressly provided to be for the support of the beneficiary or his family, a court of equity having jurisdiction may make such order regarding the surplus, if any, not required for the support of the beneficiary or his family, as justice and equity may require.

(e) The defendant trustee in any such action] In any action brought by a creditor of a beneficiary of a trust to enforce a judgment against the beneficiary in which the defendant trustee is served with garnishee process, the trustee shall be entitled to charge in the administration account of the trust such expenses and disbursements as the court to which the action is brought determines to be reasonable and proper.

Sec. 119. Section 45a-474 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018):

When a will, trust agreement or other instrument establishing a trust fails to provide for the contingency of the trustee's refusal to accept the trust or the trustee's resignation, death or incapacity, the Probate Court for the district within which the estate is situated, or, when the trust has been created by will, in the district having jurisdiction of such will, may, on the happening of any such contingency, appoint some suitable person to fill such vacancy, taking from him a probate bond, unless in the case of a will it is otherwise provided therein. [, in which case the provisions of section 45a-473 shall apply.] The court may appoint a successor trustee of an inter vivos trust before such contingency has occurred if the court finds that a vacancy in the office of trustee is likely to occur. The court shall specify the conditions that the successor trustee of such inter vivos trust must satisfy before becoming trustee. In the event of a vacancy in the office of trustee of such inter vivos trust, the successor trustee may assume the office immediately upon satisfying the conditions set forth in the court's order without further court action.

Sec. 120. Sections 45a-473, 45a-484 and 45a-487 to 45a-487f, inclusive, of the general statutes are repealed. (Effective October 1, 2018)


This act shall take effect as follows and shall amend the following sections:
Section 1	October 1, 2018	New section
Sec. 2	October 1, 2018	New section
Sec. 3	October 1, 2018	New section
Sec. 4	October 1, 2018	New section
Sec. 5	October 1, 2018	New section
Sec. 6	October 1, 2018	New section
Sec. 7	October 1, 2018	New section
Sec. 8	October 1, 2018	New section
Sec. 9	October 1, 2018	New section
Sec. 10	October 1, 2018	New section
Sec. 11	October 1, 2018	New section
Sec. 12	October 1, 2018	New section
Sec. 13	October 1, 2018	New section
Sec. 14	October 1, 2018	New section
Sec. 15	October 1, 2018	New section
Sec. 16	October 1, 2018	New section
Sec. 17	October 1, 2018	New section
Sec. 18	October 1, 2018	New section
Sec. 19	October 1, 2018	New section
Sec. 20	October 1, 2018	New section
Sec. 21	October 1, 2018	New section
Sec. 22	October 1, 2018	New section
Sec. 23	October 1, 2018	New section
Sec. 24	October 1, 2018	New section
Sec. 25	October 1, 2018	New section
Sec. 26	October 1, 2018	New section
Sec. 27	October 1, 2018	New section
Sec. 28	October 1, 2018	New section
Sec. 29	October 1, 2018	New section
Sec. 30	October 1, 2018	New section
Sec. 31	October 1, 2018	New section
Sec. 32	October 1, 2018	New section
Sec. 33	October 1, 2018	New section
Sec. 34	October 1, 2018	New section
Sec. 35	October 1, 2018	New section
Sec. 36	October 1, 2018	New section
Sec. 37	October 1, 2018	New section
Sec. 38	October 1, 2018	New section
Sec. 39	October 1, 2018	New section
Sec. 40	October 1, 2018	New section
Sec. 41	October 1, 2018	New section
Sec. 42	October 1, 2018	New section
Sec. 43	October 1, 2018	New section
Sec. 44	October 1, 2018	New section
Sec. 45	October 1, 2018	New section
Sec. 46	October 1, 2018	New section
Sec. 47	October 1, 2018	New section
Sec. 48	October 1, 2018	New section
Sec. 49	October 1, 2018	New section
Sec. 50	October 1, 2018	New section
Sec. 51	October 1, 2018	New section
Sec. 52	October 1, 2018	New section
Sec. 53	October 1, 2018	New section
Sec. 54	October 1, 2018	New section
Sec. 55	October 1, 2018	New section
Sec. 56	October 1, 2018	New section
Sec. 57	October 1, 2018	New section
Sec. 58	October 1, 2018	New section
Sec. 59	October 1, 2018	New section
Sec. 60	October 1, 2018	New section
Sec. 61	October 1, 2018	New section
Sec. 62	October 1, 2018	New section
Sec. 63	October 1, 2018	New section
Sec. 64	October 1, 2018	New section
Sec. 65	October 1, 2018	New section
Sec. 66	October 1, 2018	New section
Sec. 67	October 1, 2018	New section
Sec. 68	October 1, 2018	New section
Sec. 69	October 1, 2018	New section
Sec. 70	October 1, 2018	New section
Sec. 71	October 1, 2018	New section
Sec. 72	October 1, 2018	New section
Sec. 73	October 1, 2018	New section
Sec. 74	October 1, 2018	New section
Sec. 75	October 1, 2018	New section
Sec. 76	October 1, 2018	New section
Sec. 77	October 1, 2018	New section
Sec. 78	October 1, 2018	New section
Sec. 79	October 1, 2018	New section
Sec. 80	October 1, 2018	New section
Sec. 81	October 1, 2018	New section
Sec. 82	October 1, 2018	New section
Sec. 83	October 1, 2018	New section
Sec. 84	October 1, 2018	New section
Sec. 85	October 1, 2018	New section
Sec. 86	October 1, 2018	New section
Sec. 87	October 1, 2018	New section
Sec. 88	October 1, 2018	New section
Sec. 89	October 1, 2018	New section
Sec. 90	October 1, 2018	New section
Sec. 91	October 1, 2018	New section
Sec. 92	October 1, 2018	New section
Sec. 93	October 1, 2018	New section
Sec. 94	October 1, 2018	New section
Sec. 95	October 1, 2018	New section
Sec. 96	October 1, 2018	New section
Sec. 97	October 1, 2018	New section
Sec. 98	October 1, 2018	New section
Sec. 99	October 1, 2018	New section
Sec. 100	October 1, 2018	New section
Sec. 101	October 1, 2018	New section
Sec. 102	October 1, 2018	New section
Sec. 103	October 1, 2018	New section
Sec. 104	October 1, 2018	New section
Sec. 105	October 1, 2018	New section
Sec. 106	October 1, 2018	New section
Sec. 107	October 1, 2018	New section
Sec. 108	October 1, 2018	New section
Sec. 109	October 1, 2018	New section
Sec. 110	October 1, 2018	New section
Sec. 111	October 1, 2018	New section
Sec. 112	October 1, 2018	New section
Sec. 113	October 1, 2018	New section
Sec. 114	October 1, 2018	45a-490
Sec. 115	October 1, 2018	45a-495
Sec. 116	October 1, 2018	New section
Sec. 117	October 1, 2018	45a-482
Sec. 118	October 1, 2018	52-321
Sec. 119	October 1, 2018	45a-474
Sec. 120	October 1, 2018	Repealer section

Statement of Legislative Commissioners:

In Section 2, "provided" was changed to "except" for clarity; in Sec. 3(18) "5" was changed to "91" for accuracy; in Sec. 4, "individual" was changed to "employee" for consistency; in Sec. 85(a) "or said office" was added after "person" for accuracy; in Sec. 93, "91" was changed to "92" for accuracy; in Sec. 107(9), "Qualified person" was changed to "Qualified trustee" for consistency with the defined term; and in Sec. 110(2), "tortuous" was changed to "tortious" for accuracy.

JUD

Joint Favorable Subst.