Michigan Laws 700.7411 – Modification or termination of noncharitable trust; consent; “settlor’s representative” defined
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Terms Used In Michigan Laws 700.7411
- Agent: includes , but is not limited to, an attorney-in-fact under a durable or nondurable power of attorney and an individual authorized to make decisions as a patient advocate concerning another's health care. See Michigan Laws 700.1103
- Conservator: means a person appointed by a court to manage a protected individual's estate. See Michigan Laws 700.1103
- Continuance: Putting off of a hearing ot trial until a later time.
- Court: means the probate court or, when applicable, the family division of circuit court. See Michigan Laws 700.1103
- 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: means a person who has qualified as a guardian of a minor or a legally incapacitated individual under a parental or spousal nomination or a court appointment and includes a limited guardian as described in sections 5205, 5206, and 5306. See Michigan Laws 700.1104
- Incapacitated individual: means an individual who is impaired by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication, or other cause, not including minority, to the extent of lacking sufficient understanding or capacity to make or communicate informed decisions. See Michigan Laws 700.1105
- Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.
- Person: means an individual or an organization. See Michigan Laws 700.1106
- 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
- Proceeding: includes an application and a petition, and may be an action at law or a suit in equity. See Michigan Laws 700.1106
- Property: means anything that may be the subject of ownership, and includes both real and personal property or an interest in real or personal property. See Michigan Laws 700.1106
- Settlor: means a person, including a testator or a trustee, who creates a trust. See Michigan Laws 700.7103
- terms of the trust: means the manifestation of the settlor's intent regarding a trust's provisions as expressed in the trust instrument or as may be established by other evidence that would be admissible in a judicial proceeding. See Michigan Laws 700.1107
- Trust: includes , but is not limited to, an express trust, private or charitable, with additions to the trust, wherever and however created. See Michigan Laws 700.1107
- Trust director: means that term as defined in section 7703a. See Michigan Laws 700.7103
- Trustee: A person or institution holding and administering property in trust.
- Trustee: includes an original, additional, or successor trustee, whether or not appointed or confirmed by the court. See Michigan Laws 700.1107
- Veto: The procedure established under the Constitution by which the President/Governor refuses to approve a bill or joint resolution and thus prevents its enactment into law. A regular veto occurs when the President/Governor returns the legislation to the house in which it originated. The President/Governor usually returns a vetoed bill with a message indicating his reasons for rejecting the measure. In Congress, the veto can be overridden only by a two-thirds vote in both the Senate and the House.
(1) Subject to subsection (2), a noncharitable irrevocable trust may be modified or terminated in any of the following ways:
(a) By the court on the consent of the trustee and the qualified trust beneficiaries, if the court concludes that the modification or termination of the trust is consistent with the material purposes of the trust or that continuance of the trust is not necessary to achieve any material purpose of the trust.
(b) On the consent of the qualified trust beneficiaries and a person or committee that is given the power under the terms of the trust to grant, veto, or withhold approval of termination or modification of the trust.
(c) By a trustee or other person or committee that is given a power by the terms of the trust to direct the termination or modification of the trust.
(2) Subsection (1) does not apply to irrevocable trusts created before or to revocable trusts that become irrevocable before April 1, 2010.
(3) Notice of any proceeding to terminate or modify a trust must be given to the settlor, the settlor’s representative if the petitioner has a reasonable basis to believe the settlor is an incapacitated individual, the trust director, if any, a powerholder described in subsection (1)(b) or (c), if any, the trustee, and any other person named in the terms of the trust to receive notice of such a proceeding.
(4) On termination of a trust under subsection (1), the trustee shall distribute the trust property as agreed by the qualified trust beneficiaries.
(5) If the trustee fails or refuses to consent, or fewer than all of the qualified trust beneficiaries consent, to a proposed modification or termination of the trust under subsection (1), the modification or termination may be approved by the court if the court is satisfied that both of the following apply:
(a) If the trustee and all of the qualified trust beneficiaries had consented, the trust could have been modified or terminated under this section.
(b) The interests of a qualified trust beneficiary who does not consent will be adequately protected.
(6) As used in this section, “settlor’s representative” means the settlor’s agent under a durable power of attorney, if the agent is known to the petitioner, or, if an agent has not been appointed, the settlor’s conservator, plenary guardian, or partial guardian.