STATE OF NEW YORK
________________________________________________________________________
9764
IN ASSEMBLY
February 6, 2018
___________
Introduced by M. of A. DINOWITZ -- (at request of the Office of Court
Administration) -- read once and referred to the Committee on Judici-
ary
AN ACT to amend the surrogate's court procedure act, in relation to the
computation and allocation of the commissions of trustees of charita-
ble trusts; and repealing certain provisions of such law relating
thereto
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Paragraphs (a) and (b) of subdivision 5 of section 2308 of
2 the surrogate's court procedure act, paragraph (a) as amended by chapter
3 936 of the laws of 1984, are amended to read as follows:
4 (a) During the continuance of a trust created solely for public, reli-
5 gious, charitable, scientific, literary, educational or fraternal uses
6 and during the period of continuance of such a trust established after
7 the termination of a life use or uses the trustee shall be entitled to
8 and may retain annual commissions [from income in an amount annually
9 equal to 6 per cent of income collected in each year] according to the
10 terms specified in subdivision 2 of this section, but only to the extent
11 of 80 percent of the rates stated therein. Notwithstanding any other
12 provision of law, with respect to any portion of such trust which
13 exceeds a principal value of twenty million dollars, the trustee may
14 only take annual commissions to the extent of 50 percent of the rate
15 specified in paragraph (c) of subdivision 2 of this section.
16 (b) In the case of a trust [created solely for public, religious,
17 charitable, scientific, literary, educational or fraternal uses the]
18 described in paragraph (a) of this subdivision, a trustee shall not be
19 entitled to any commission from principal as specified in subdivision 1
20 of this section for paying out principal.
21 § 2. Paragraph (c) of subdivision 6 of section 2308 of the surrogate's
22 court procedure act is REPEALED.
23 § 3. Subdivision 12 of section 2308 of the surrogate's court procedure
24 act, as added by chapter 237 of the laws of 1978, is amended to read as
25 follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09529-05-8
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1 12. If a trustee of a trust is authorized or required by the terms of
2 the will to accumulate income for any purpose permitted by law, any
3 income so accumulated which is not added to principal of the trust shall
4 be deemed a separate trust for purposes of this subdivision and the
5 trustee shall be entitled to commissions in respect thereof at the rates
6 and according to the terms and provisions of subdivisions 1 [and], 2 and
7 5 of this section as though, for purposes of computing commissions of
8 the trustee, income so accumulated was principal.
9 § 4. Subdivision 3 of section 2309 of the surrogate's court procedure
10 act, as amended by chapter 243 of the laws of 2001, is amended to read
11 as follows:
12 3. Unless the will or lifetime trust instrument otherwise explicitly
13 provides the annual commissions allowed by [subdivision 2] this section
14 shall be payable one-third from the income of the trust and two-thirds
15 from the principal of the trust. However, in the case of a trust whose
16 definition of income is governed by 11-2.4 of the estates, powers and
17 trusts law or a charitable remainder annuity trust or a charitable
18 remainder unitrust, as defined in section six hundred sixty-four of the
19 Internal Revenue Code of nineteen hundred eighty-six, as amended, such
20 annual commissions shall be payable from the corpus of any such trust
21 after allowance for the annuity or unitrust amounts and shall not be
22 payable out of such annuity or unitrust amounts.
23 § 5. Paragraphs (a) and (b) of subdivision 5 of section 2309 of the
24 surrogate's court procedure act, paragraph (a) as amended by chapter 936
25 of the laws of 1984, are amended to read as follows:
26 (a) During the continuance of a trust created solely for public, reli-
27 gious, charitable, scientific, literary, educational or fraternal uses
28 and during the period of continuance of such a trust established after
29 the termination of a life use or uses the trustee shall be entitled to
30 and may retain annual commissions [from income in an amount annually
31 equal to 6 per cent of income collected in each year] according to the
32 terms specified in subdivision 2 of this section, but only to the extent
33 of 80 percent of the rates stated therein. Notwithstanding any other
34 provision of law, with respect to any portion of such trust which
35 exceeds a principal value of twenty million dollars, the trustee may
36 only take annual commissions to the extent of 50 percent of the rate
37 specified in paragraph (c) of subdivision 2 of this section.
38 (b) In the case of a trust [created solely for public, religious,
39 charitable, scientific, literary, educational or fraternal uses the]
40 described in paragraph (a) of this subdivision, a trustee shall not be
41 entitled to any commission from principal as specified in subdivision 1
42 of this section for paying out principal.
43 § 6. Paragraphs (a) and (b) of subdivision 3 of section 2312 of the
44 surrogate's court procedure act, as amended by chapter 511 of the laws
45 of 1987, are amended to read as follows:
46 (a) during the continuance of a trust created solely for public, reli-
47 gious, charitable, scientific, literary, educational or fraternal uses
48 and during the period of continuance of such a trust established after
49 the termination of a life use or uses a corporate trustee shall be enti-
50 tled to and may retain annual commissions [from income] in accordance
51 with the provisions of subdivision 1 or 2 [hereof] of this section, as
52 the case may be, except that the trustee shall not be entitled to a
53 commission for paying out principal.
54 (b) In the case of a trust created solely for public, religious, char-
55 itable, scientific, literary, educational or fraternal uses a corporate
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1 trustee shall not be entitled to any commission [from] for paying out
2 principal.
3 § 7. This act shall take effect immediately and shall apply to all
4 trusts in existence on or after such effective date; provided, however
5 that a trustee of a trust in existence on such effective date may elect
6 to continue to take commissions under the law in effect prior to such
7 effective date until December 31 of the year this act takes effect.