Text: HF02459 Text: HF02461 Text: HF02400 - HF02499 Text: HF Index Bills and Amendments: General Index Bill History: General Index
Get Version To Print
PAG LIN 1 1 Section 1. NEW SECTION. 633.699A MODIFICATION OR 1 2 TERMINATION OF TESTAMENTARY TRUST. 1 3 1. On petition by a trustee or beneficiary, and after 1 4 notice to all interested parties as determined by the court, 1 5 the court may modify the provisions of a testamentary trust or 1 6 may terminate a testamentary trust in whole or in part if the 1 7 continuation of the trust under its terms would defeat or 1 8 substantially impair the accomplishment of the purposes of the 1 9 trust, or if the purposes of the trust have been fulfilled, or 1 10 have become illegal or impossible to fulfill. 1 11 a. The court may order the trustee to do acts that are not 1 12 authorized or are forbidden by the will creating the trust, or 1 13 may order that the trustee be prohibited from performing acts 1 14 that are required by the terms of the trust. 1 15 b. The existence of a trust provision restraining transfer 1 16 of the beneficiary's interest does not prevent application of 1 17 this subsection. 1 18 c. If the court orders the termination of the trust, 1 19 disposition of all property shall be made according to the 1 20 will provisions that address the disposition of the property 1 21 in the event the trust is terminated. However, if the will 1 22 does not address the disposition of the property in the event 1 23 the trust is terminated, the court shall determine the 1 24 disposition of the trust property. 1 25 2. On petition by a trustee or beneficiary, and after 1 26 notice to all interested parties as determined by the court, 1 27 if the court determines that the fair market value of a 1 28 testamentary trust has become so low in relation to the cost 1 29 of administration that continuation of the trust under its 1 30 existing terms will defeat or substantially impair the 1 31 accomplishment of its purposes, the court may, in its 1 32 discretion, order termination of the trust, modification of 1 33 the trust, or appointment of a new trustee. 1 34 a. If the court orders the termination of the trust, 1 35 disposition of all property shall be made according to the 2 1 will provisions that address the disposition of the property 2 2 in the event the trust is terminated. However, if the will 2 3 does not address the disposition of the property in the event 2 4 the trust is terminated, the court shall determine the 2 5 disposition of the trust property. 2 6 b. The existence of a trust provision restraining transfer 2 7 of the beneficiary's interest does not prevent application of 2 8 this subsection. 2 9 3. In the case of a charitable testamentary trust, the 2 10 attorney general shall be considered an interested party under 2 11 this section. This section shall not be construed to limit 2 12 intervention by the attorney general according to section 2 13 633.303. 2 14 EXPLANATION 2 15 This bill adds a new section to the probate code pertaining 2 16 to modification or termination of trusts. The section 2 17 proposes that the court may modify or terminate a trust when 2 18 the enforcement of the terms of a trust is no longer 2 19 consistent with the purposes of the trust, or it is impossible 2 20 to continue the trust, or when the trust has become 2 21 uneconomical to administer. 2 22 LSB 3465HV 76 2 23 jls/jw/5
Text: HF02459 Text: HF02461 Text: HF02400 - HF02499 Text: HF Index Bills and Amendments: General Index Bill History: General Index
© 1996 Cornell College and League of Women Voters of Iowa
Comments? webmaster@legis.iowa.gov.
Last update: Tue Apr 2 13:32:58 CST 1996
URL: /DOCS/GA/76GA/Legislation/HF/02400/HF02460/960305.html
jhf