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text of the Alaska Statutes..
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SENATE CS FOR CS FOR HOUSE
BILL NO. 101(JUD)
"An Act relating to
certain irrevocable transfers in trust, to the jurisdiction governing
a trust, to challenges to trusts or property transfers in trust, to the validity
of trust interests, and to transfers of certain trust interests; and
providing for an effective date."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
* Section
1. AS 13.12.205(2) is amended to read:
(2) property transferred in any of the following forms by the
decedent during marriage:
(A) an irrevocable transfer, including an irrevocable
transfer in trust with a transfer restriction under AS
34.40.110(a), in which the decedent retained the right to
the possession or enjoyment of, or to the income from, the
property, if and to the extent the decedent's right terminated at or continued
beyond the decedent's death; the amount included is the value of the
fraction of the property to which the decedent's right related, to
the extent the fraction of the property passed outside probate to
or for the benefit of a person other than the decedent's estate or
surviving spouse;
(B) a transfer in which the decedent created a power over the income
or property, exercisable by the decedent alone or in conjunction with another
person, or exercisable by a nonadverse party, to or for the benefit of the
decedent, the decedent's creditors, the decedent's estate, or creditors
of the decedent's estate; the amount included with respect to a
power over property is the value of the property subject to the
power, and the amount included with respect to a power over income
is the value of the property that produces or
produced the income, to the extent the power in either case was
exercisable at the decedent's death to or for the benefit of a
person other than the decedent's surviving spouse or to the extent
the property passed at the decedent's death, by exercise, release,
lapse, default, or otherwise, to or for the benefit of a person
other than the decedent's estate or surviving spouse; if the power is a power
over both income and property and the preceding provision defining the amount
included produces different amounts, the amount included is the greater amount;
and
* Sec. 2.
AS 13.36.035(a) is amended to read:
(a) The court has exclusive jurisdiction of proceedings initiated
by interested parties concerning the internal affairs of trusts,
including trusts covered by (c) of this section. Except as
provided in (c) and (d) of this section, proceedings that
[. PROCEEDINGS WHICH] may be maintained under this section are those
concerning the administration and distribution of trusts, the
declaration of rights, and the determination of other matters
involving trustees and beneficiaries of trusts. These include
[, BUT ARE NOT LIMITED TO,] proceedings to
(1) appoint or remove a trustee;
(2) review trustees' fees and to review and settle interim or
final accounts;
(3) ascertain beneficiaries, determine any question arising in the administration
or distribution of any trust including questions of construction of
trust instruments, instruct trustees, and determine the existence
or nonexistence of any immunity, power, privilege, duty,
or right; and
(4) release registration of a trust.
* Sec. 3.
AS 13.36.035 is amended by adding new subsections to read:
(c) A provision that the laws of this state govern the validity,
construction, and administration of the trust and that the trust is
subject to the jurisdiction of this state is valid, effective, and
conclusive for the trust if
(1) some or all of the trust assets are deposited in this state
and are being administered by a qualified person; in this
paragraph, "deposited in this state" includes being held
in a checking account, time deposit, certificate of deposit, brokerage
account, trust company fiduciary account, or other similar account or
deposit that is located in this state;
(2) a trustee is a qualified person who is designated as a trustee
under the governing instrument or by a court having jurisdiction
over the trust;
(3) the powers of the trustee identified under (2) of this
subsection include or are limited to
(A) maintaining records for the trust on an exclusive basis or a
nonexclusive basis; and
(B) preparing or arranging for the preparation of, on an exclusive
basis or a nonexclusive basis, an income tax return that must be filed by
the trust; and
(4) part or all of the administration occurs in this state,
including physically maintaining trust records in this state.
(d) The validity,
construction, and administration of a trust with a state jurisdiction
provision are determined by the laws of this state, including the
(1) capacity of the settlor;
(2) powers, obligations, liabilities, and rights of the trustees
and the appointment and removal of the trustees; and
(3) existence and extent of powers, conferred or retained,
including a
trustee's discretionary powers, the powers retained by a
beneficiary of the trust, and the validity of the exercise of a
power.
(e) In (d) of this
section, "settlor" means a person who transfers property in trust;
"settlor" includes a person who furnishes the property
transferred to a trust even if the trust is created by another
person.
* Sec. 4.
AS 13.36.045(a) is amended to read:
(a) The court will not, over the objection of a party, entertain
proceedings under AS 13.36.035 involving a trust registered or
having its principal place of administration in another state,
unless
(1) all appropriate parties could not be bound by litigation in
the courts of the state where the trust is registered or has its
principal place of administration; [OR]
(2) the interests of justice otherwise would seriously be impaired;
or
(3) the trust satisfies AS 13.36.035(c).
* Sec. 5.
AS 13.36 is amended by adding new sections to read:
Sec. 13.36.310. Challenges to trusts. Except as provided in
AS 34.40.110, a trust that is covered by AS 13.36.035(c) or that is
otherwise governed by the laws of this state, or a property
transfer to a trust that is covered by AS 13.36.035(c) or that is
otherwise governed by the laws of this state, is not void, voidable,
liable to be set aside, defective in any fashion, or questionable
as to the settlor's capacity, on the grounds that the trust or
transfer avoids or defeats a right, claim, or interest conferred by
law on a person by reason of a personal or business relationship with
the settlor or by way of a marital or similar right. In this
section, "settlor" means a person who
transfers property in trust; "settlor" includes a person
who furnishes the property transferred to a trust even if the trust
is created by another person.
Sec. 13.36.390. Definitions. In AS 13.36,
(1) "qualified person" means
(A) an individual who, except for brief intervals, military service,
attendance at an educational or training institution, or for absences
for good cause shown, resides in this state, whose true and
permanent home is in this state, who does not have a present
intention of moving from this state, and who has the intention of
returning to this state when away;
(B) a trust company that is organized under AS 06.25 and that has
its principal place of business in this state; or
(C) a bank that is organized under AS 06.05, or a national banking
association that is organized under 12 U.S.C. 21 - 216d, if the bank or
national banking association possesses and exercises trust powers and
has its principal place of business in this state;
(2) "state jurisdiction provision" means a provision
that the laws of this state govern the validity, construction, and
administration of a trust and that the trust is subject to the
jurisdiction of this state.
* Sec. 6. AS 34.27.050(a) is amended to read:
(a) A nonvested property interest is invalid unless
(1) when the interest is created, it is certain to vest or
terminate no later than 21 years after the death of an individual
then alive; [OR]
(2) the interest either vests or terminates within 90 years after
its creation; or
(3) the interest is in a trust and all or part of the income
or principal of the trust may be distributed, in the discretion of
the trustee, to a person who is living when the trust is created.
* Sec. 7. AS 34.40.010 is amended to read:
Sec. 34.40.010. Invalidity generally.
Except as provided in AS 34.40.110, a [A] conveyance
or assignment, in writing or otherwise, of an estate or interest in land,
or in goods, or things in action, or of rents or profits issuing from
them or a charge upon land, goods, or things in action, or upon the
rents or profits from them, made with the intent to hinder, delay,
or defraud creditors or other persons of their lawful suits,
damages, forfeitures, debts, or demands, or a bond or other evidence of debt
given, action commenced, decree or judgment suffered, with the like
intent, as against the persons so hindered, delayed, or defrauded
is void.
* Sec. 8.
AS 34.40.110 is repealed and reenacted to read:
Sec. 34.40.110. Restricting transfers of
trust interests. (a) A person who in writing transfers
property in trust may provide that the interest of a beneficiary of the
trust may not be either voluntarily or involuntarily transferred before
payment or delivery of the interest to the beneficiary by the
trustee. In this subsection,
(1) "property" includes real property, personal
property, and interests
in real or personal property;
(2) "transfer" means any form of transfer, including
deed, conveyance,
or assignment.
(b) If a trust
contains a transfer restriction allowed under (a) of this section, the
transfer restriction prevents a creditor existing when the trust is
created, a person who subsequently becomes a creditor, or another
person from satisfying a claim out of the beneficiary's interest in the
trust, unless the
(1) transfer was intended in whole or in part to hinder, delay, or defraud
creditors or other persons under AS 34.40.010;
(2) trust provides that the settlor may revoke or terminate all or
part of the trust without the consent of a person who has a substantial
beneficial interest in the trust and the interest would be adversely
affected by the exercise of the power held by the settlor to revoke
or terminate all or part of the trust; in this paragraph, "revoke
or terminate" does not include a power to veto a distribution from
the trust, a testamentary special power of appointment or similar
power, or the right to receive a distribution of income, corpus, or
both in the discretion of a person, including a trustee, other than
the settlor;
(3) trust requires that all or a part of the trust's income or
principal, or
both, must be distributed to the settlor; or
(4) at the time of the transfer, the settlor is in default by 30
or more days of making a payment due under a child support judgment
or order.
(c) The satisfaction of
a claim under (b)(1) - (4) of this section is limited to that part
of the trust to which (b)(1) - (4) of this section applies.
(d) A person may not
bring an action with respect to a claim allowed under (b)(1) of
this section if the person
(1) is a creditor when the trust is created unless the action is
brought
within the later of
(A) four years after the transfer is made; or
(B) one year after the transfer is or reasonably could have been discovered
by the person; or
(2) becomes a creditor subsequent to the transfer unless the
action is
brought within four years after the transfer is made.
(e) In this section, "settlor"
means a person who transfers real property, personal property, or
an interest in real or personal property, in trust.
* Sec. 9.
This Act does not apply to a trust unless the trust is created on or
after the
effective date of this Act.
* Sec.
10. This Act takes effect immediately under AS 01.10.070(c).
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