Delaware Code Title 12 Sec. 3342 – Modification of trust by consent while trustor is living
(a) Unless the trust’s governing instrument expressly provides that the governing instrument may not be modified under this section, under a nonjudicial settlement agreement under § 3338 of this title or similar provision of law, or under a modification agreement, an irrevocable trust may be modified by the addition of a new provision or the modification of any existing provision—so long as such provision could have been included in the governing instrument of a trust were such trust created upon the date of the modification—by written consent or written nonobjection of all of the trust’s trustors, all then serving fiduciaries and all beneficiaries having an interest in the trust, regardless of whether the modification may violate a material purpose of the trust; provided, however, that unless the trustor, or a person acting on behalf of the trustor, confirms in writing that the transfer in trust is an incomplete gift for federal gift tax purposes, neither a trustor nor, on behalf of a trustor, a guardian or an agent under a power of attorney, may represent and bind any beneficiary (other than the trustor) with respect to the modification, notwithstanding any provision in the governing instrument, or applicable law, that provides that the trustor may represent or bind 1 or more beneficiaries. A trustor’s power to provide a written consent or written nonobjection to a trust’s modification may be exercised:
(1) By an agent under a power of attorney only to the extent expressly authorized by the power of attorney or the terms of the trust’s governing instrument; or
(2) If an agent under a power of attorney is not so authorized, by the guardian of the trustor’s property (or similar court-appointed representative) with the approval of the court supervising the guardian (or similar representative).
Terms Used In Delaware Code Title 12 Sec. 3342
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Court: means the Court of Chancery. See Delaware Code Title 12 Sec. 39A-101
- Fiduciary: A trustee, executor, or administrator.
- Gift: A voluntary transfer or conveyance of property without consideration, or for less than full and adequate consideration based on fair market value.
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Guardian: is a "guardian of the person" as that term is used in this title. See Delaware Code Title 12 Sec. 39A-101
- Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.
- Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- State: means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, a federally recognized Indian tribe, or any territory or insular possession subject to the jurisdiction of the United States. See Delaware Code Title 12 Sec. 39A-101
- Trustor: The person who makes or creates a trust. Also known as the grantor or settlor.
(b) No fiduciary shall have a duty to consent to any proposed modification nor, absent wilful misconduct, have any liability to any person having an interest in the trust for failure to consent to any proposed modification.
(c) Any interested person, including the trustor, may bring a proceeding in the Court of Chancery to interpret, apply, enforce, or determine the validity of a modification adopted under this section, including but not limited to determining whether the representation as provided in § 3547 of this title was adequate; provided, however, that any such person may waive the right to contest the modification.
(d) This section shall apply to any trust administered under the laws of this State.
80 Del. Laws, c. 340, § 1; 81 Del. Laws, c. 149, § 1; 81 Del. Laws, c. 320, § 4; 82 Del. Laws, c. 52, § 1; 82 Del. Laws, c. 278, § 1; 83 Del. Laws, c. 69, § 2;