Revision: Dec. 3, 2019, 3:46 p.m.
CHAPTER 230
SB 98 - FINAL VERSION
5Jun2019... 2059h
2019 SESSION
19-0909
08/01
SENATE BILL 98
SPONSORS: Sen. D'Allesandro, Dist 20; Sen. Bradley, Dist 3
COMMITTEE: Commerce
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AMENDED ANALYSIS
This bill makes certain changes to the New Hampshire trust code. This bill also establishes a committee to study the effects of past trust legislation.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
5Jun2019... 2059h 19-0909
08/01
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
Be it Enacted by the Senate and House of Representatives in General Court convened:
230:1 New Section; New Hampshire Trust Code; Precatory Language. Amend RSA 564-B by inserting after section 1-112 the following new section:
564-B:1-113 Precatory Language.
(a) For purposes of this section, the following definitions apply:
(1) "Letter of wishes" means a record that:
(A) Is not a trust instrument;
(B) Is created by a settlor; and
(C) Contains precatory language.
(2) "Precatory language" means language that:
(A) Is not binding on any trustee, trust advisor, or trust protector;
(B) Expresses the settlor's wishes regarding the exercise of any discretionary power by a trustee, trust advisor, or trust protector; and
(C) Is not inconsistent with the terms of the trust.
(b) In exercising a discretionary power, a trustee, trust advisor, or trust protector may consider precatory language contained in the trust instrument or a letter of wishes.
(c) Precatory language does not impose any duty on any trustee, trust advisor, or trust protector, and the fact that a trustee, trust advisor, or trust protector does not exercise a discretionary power in accordance with precatory language shall not create an inference that the trustee, trust advisor, or trust protector improperly exercised the power.
(d) In determining whether a trustee, trust advisor, or trust protector exercised a discretionary power in a manner that is consistent with the settlor's intent, a court may consider precatory language contained in the trust instrument or a letter of wishes. A court may consider precatory language contained in a letter of wishes regardless of whether the trust instrument is ambiguous.
(e) Except as provided under the terms of the trust or by court order, a trustee, trust advisor, or trust protector shall not have any duty to provide any beneficiary a copy of a letter of wishes.
230:2 New Hampshire Trust Code; Creditor's Claim Against a Beneficiary of a Discretionary Trust. Amend RSA 564-B:5-504(e)(3)(B) to read as follows:
(B) The maximum amount of trust property that can be distributed to or for the benefit of the [settlor] beneficiary from the trust.
230:3 New Hampshire Trust Code; Specific Powers of Trustee. Amend RSA 564-B:8-816(a)(19) to read as follows:
(19) on terms and conditions that the trustee considers to be fair and reasonable under the circumstances:
(A) guarantee loans or secure other obligations, including loans made by others to the beneficiary; or
(B) pledge trust property to guarantee loans or secure other obligations, including loans made by others to the beneficiary;
230:4 New Section; New Hampshire Trust Code; Limitation on Personal Liability of Settlors. Amend RSA 564-B by inserting after section 5-510 the following new section:
564-B:5-511 Limitation on Personal Liability of Settlors.
(a) A settlor of an irrevocable trust is not personally liable on a contract into which a trustee, trust advisor, or trust protector properly enters in the course of administering the trust, unless the settlor expressly agrees to be personally liable on that contract.
(b) A settlor of an irrevocable trust is not personally liable for torts committed by a trustee, trust advisor, or trust protector in the course of administering the trust, unless the settlor is personally at fault.
(c) A settlor of an irrevocable trust is not personally liable for claims or obligations arising from the ownership or control of trust property by a trustee, trust advisor, or trust protector, unless the settlor is personally at fault. Claims arising from the ownership or control of trust property include liability for any violation of environmental law.
(d) This section does not limit or otherwise affect:
(1) A settlor's obligations under an agreement with a trustee, trust advisor, or trust protector;
(2) The rights of a settlor's creditor under this chapter; or
(3) The application of RSA 564-B:4-406(f), RSA 564-B:8-812, RSA 564-B:8-817(d), or any other provision of this chapter.
230:5 Committee Established. There is established a committee to study the effects of past New Hampshire trust code legislation.
230:6 Membership and Compensation.
I. The members of the committee shall be as follows:
(a) Three members of the house of representatives, appointed by the speaker of the house of representatives.
(b) One member of the senate, appointed by the president of the senate.
II. Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.
230:7 Duties. The committee shall investigate whether past New Hampshire trust legislation is having its desired effect. The committee shall determine if it is in the best interest for the state to continue to evolve the trust code to make it more favorable to trust settlors and trust companies. If the committee determines that there have been unintended consequences resulting from prior legislation, the committee shall make recommendations to mitigate any possible risk or exposure to the state. Additionally, the committee shall consider if there is a state revenue opportunity to be generated from the assets which reside within these New Hampshire chartered trust companies to offset the cost of administration by the state of New Hampshire.
230:8 Chairperson; Quorum. The members of the study committee shall elect a chairperson from among the members. The first meeting of the committee shall be called by the first-named house member. The first meeting of the committee shall be held within 45 days of the effective date of this section. Three members of the committee shall constitute a quorum.
230:9 Report. The committee shall report its findings and any recommendations for proposed legislation to the speaker of the house of representatives, the president of the senate, the house clerk, the senate clerk, the governor, and the state library on or before November 1, 2019.
230:10 Effective Date.
I. Section 2 of this act shall take effect upon its passage.
II. Sections 1, 3, and 4 of this act shall take effect 60 days after its passage.
III. The remainder of this act shall take effect upon its passage.
Approved: July 12, 2019
Effective Date:
I. Section 2 shall take effect July 12, 2019.
II. Sections 1,3, and 4 shall take effect September 10, 2019.
III. Remainder shall take effect July 12, 2019.