District Of Columbia 2023-2024 Regular Session

District Of Columbia Council Bill B25-0219 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	ENROLLED ORIGINAL
	1	+	ENGROSSED ORIGINAL
	2	+
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5	6		1
6	7
7		-	~~AN ACT~~
	8	+	A BILL
8	9
9		-	~~_____________~~
	10	+	25-219
10	11
11	12
12	13		IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
13	14
14		-	~~__________~~________________
	15	+	________________
15	16
16	17
17		-	To amend Title 19 of the District of Columbia Official Code to enact the Uniform Powers of
18		-	Appointment Act, to provide a statutory framework for the creation, amendment,
19		-	revocation, and exercise of powers of appointment, including rules governing appointments to deceased or impermissible appointees, disposition of unappointed property, releasing powers of appointment, a powerholder’s ability to revoke or amend an exercise of power, contracts to exercise or not to exercise powers of appointment, and creditors’ claims on appointive property.
20		-	BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
21		-	act may be cited as the “Uniform Powers of Appointment Act of 2024”.
22		-	Sec. 2. Title 19 of the District of Columbia Official Code is amended as follows: (a) The table of contents is amended by inserting the phrase at the end:
23		-	“17. Uniform Powers of Appointment Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19-1701.01”.
24		-	(b) A new C hapter 17 is added to read as follows:
25		-	“CHAPTER 17
26		-	“UNIFORM POWERS OF APPOINTMENT CODE .
27		-	“SUBCHAPTER I. GENERAL PROVISIONS.
28		-	“Sec.
29		-	“19-1701.01. Short title.
30		-	“19-1701.02. Definitions.
31		-	“19-1701.03. Governing law.
32		-	“19-1701.04. Common law and principles of equity.
33		-	“SUBCHAPTER II. CREATION, REVOCATION, AND AMENDMENT OF POWER OF
34		-	APPOINTMENT.
35		-	“19-1702.01. Creation of power of appointment.
36		-	“19-1702.02. Nontransferability.
37		-	“19-1702.03. Presumption of unlimited authority.
38		-	“19-1702.04. Exception to presumption of unlimited authority.
39		-	“19-1702.05. Rules of classification.
40		-	“19-1702.06. Power to revoke or amend. ENROLLED ORIGINAL
	18	+	To amend Title 19 of the District of Columbia Official Code to enact the Uniform Powers of 1
	19	+	Appointment Act, to provide a statutory framework for the creation, amendment, 2
	20	+	revocation, and exercise of powers of appointment, including rules governing 3
	21	+	appointments to deceased or impermissible appointees, disposition of unappointed 4
	22	+	property, releasing powers of appointment, a powerholder’s ability to revoke or amend an 5
	23	+	exercise of power, contracts to exercise or not to exercise powers of appointment, and 6
	24	+	creditors’ claims on appointive property. 7
	25	+	8
	26	+	BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 9
	27	+	act may be cited as the “Uniform Powers of Appointment Act of 2024”. 10
	28	+	Sec. 2. Title 19 of the District of Columbia Official Code is amended as follows: 11
	29	+	(a) The table of contents is amended by adding at the end the phrase “17. Uniform 12
	30	+	Powers of Appointment Code . . . 19-1701.01”. 13
	31	+	(b) A new chapter 17 is added to read as follows: 14
	32	+	“CHAPTER 17 15
	33	+	“UNIFORM POWERS OF APPOINTMENT CODE . 16
	34	+	“SUBCHAPTER I. GENERAL PROVISIONS. 17
	35	+	“Section 18
	36	+	“§ 19-1701.01. Short title. 19 ENGROSSED ORIGINAL
	37	+
41	38
42	39
43	40
44	41		2
45	42
46		-	“SUBCHAPTER III. EXERCISE OF POWER OF APPOINTMENT.
47		-	“19-1703.01. Requisites for exercise of power of appointment.
48		-	“19-1703.02. Intent to exercise: determining intent from residuary clause.
49		-	“19-1703.03. Intent to exercise: after-acquired power.
50		-	“19-1703.04. Substantial compliance with donor-imposed formal requirement.
51		-	“19-1703.05. Permissible appointment.
52		-	“19-1703.06. Appointment to deceased appointee or permissible appointee’s descendant.
53		-	“19-1703.07. Impermissible appointment.
54		-	“19-1703.08. Selective allocation doctrine.
55		-	“19-1703.09. Capture doctrine: disposition of ineffectively appointed property under general
56		-	power.
57		-	“19-1703.10. Disposition of unappointed property under released or unexercised general power.
58		-	“19-1703.11. Disposition of unappointed property under released or unexercised nongeneral
59		-	power.
60		-	“19-1703.12. Disposition of unappointed property if partial appointment to taker in default.
61		-	“19-1703.13. Appointment to taker in default.
62		-	“19-1703.14. Powerholder’s authority to revoke or amend exercise.
63		-	“SUBCHAPTER IV. DISCLAIMER OR RELEASE; CONTRACT TO APPOINT OR NOT TO
64		-	APPOINT.
65		-	“19-1704.01. Disclaimer.
66		-	“19-1704.02. Authority to release.
67		-	“19-1704.03. Method of release.
68		-	“19-1704.04. Revocation or amendment of release.
69		-	“19-1704.05. Power to contract: presently exercisable power of appointment.
70		-	“19-1704.06. Power to contract: power of appointment not presently exercisable.
71		-	“19-1704.07. Remedy for breach of contract to appoint or not to appoint.
72		-	“SUBCHAPTER V. RIGHTS OF POWERHOLDER’S CREDITORS IN APPOINTIVE
73		-	PROPERTY.
74		-	“19-1705.01. Creditor claim: general power created by powerholder.
75		-	“19-1705.02. C reditor claim: general power not created by powerholder.
76		-	“19-1705.03. Power to withdraw.
77		-	“19-1705.04. Creditor claim: nongeneral power.
78		-	“SUBCHAPTER VI. MISCELLANEOUS PROVISIONS.
79		-	“19-1706.01. Uniformity of application and construction.
80		-	“19-1706.02. Relation to electronic signatures in global and national commerce act.
81		-	“19-1706.03. Application to existing relationships.
82		-	“SUBCHAPTER I. GENERAL PROVISIONS.
83		-	“§ 19- 1701.01. Short title.
84		-	“This chapter may be cited as the “ Uniform Powers of Appointment Code ”.
85		-	“§ 19- 1701.02. Definitions.
86		-	“For the purposes of this chapter, the term: ENROLLED ORIGINAL
	43	+	“§ 19-1701.02. Definitions. 20
	44	+	“§ 19-1701.03. Governing law. 21
	45	+	“§ 19-1701.04. Common law and principles of equity. 22
	46	+	“SUBCHAPTER II. CREATION, REVOCATION, AND AMENDMENT OF POWER OF 23
	47	+	APPOINTMENT. 24
	48	+	“§ 19-1702.01. Creation of power of appointment. 25
	49	+	“§ 19-1702.02. Nontransferability. 26
	50	+	“§ 19-1702.03. Presumption of unlimited authority. 27
	51	+	“§ 19-1702.04. Exception to presumption of unlimited authority. 28
	52	+	“§ 19-1702.05. Rules of classification. 29
	53	+	“§ 19-1702.06. Power to revoke or amend. 30
	54	+	“SUBCHAPTER III. EXERCISE OF POWER OF APPOINTMENT. 31
	55	+	“§ 19-1703.01. Requisites for exercise of power of appointment. 32
	56	+	“§ 19-1703.02. Intent to exercise: determining intent from residuary clause. 33
	57	+	“§ 19-1703.03. Intent to exercise: after-acquired power. 34
	58	+	“§ 19-1703.04. Substantial compliance with donor-imposed formal requirement. 35
	59	+	“§ 19-1703.05. Permissible appointment. 36
	60	+	“§ 19-1703.06. Appointment to deceased appointee or permissible appointee’s descendant. 37
	61	+	“§ 19-1703.07. Impermissible appointment. 38
	62	+	“§ 19-1703.08. Selective allocation doctrine. 39 ENGROSSED ORIGINAL
	63	+
87	64
88	65
89	66
90	67		3
91	68
92		-	“(1) “Appointee” means a person to which a powerholder makes an appointment
93		-	of appointive property.
94		-	“(2) “Appointive property” means the property or property interest subject to a
95		-	power of appointment.
96		-	“(3) “Blanket-exercise clause” means a clause in an instrument which exercises a
97		-	power of appointment and is not a specific-exercise clause. The term “blanket-exercise clause”
98		-	includes a clause that:
99		-	“(A) Expressly uses the words “any power” in exercising any power of
100		-	appointment the powerholder has;
101		-	“(B) Expressly uses the words “any property” in appointing any property
102		-	over which the powerholder has a power of appointment; or
103		-	“(C) Disposes of all property subject to disposition by the powerholder.
104		-	“(4) “Donor” means a person that creates a power of appointment.
105		-	“(5) “Exclusionary power of appointment” means a power of appointment
106		-	exercisable in favor of any one or more of the permissible appointees to the exclusion of the
107		-	other permissible appointees.
108		-	“(6) “General power of appointment” means a power of appointment exercisable
109		-	in favor of the powerholder, the powerholder’s estate, a creditor of the powerholder, or a creditor
110		-	of the powerholder’s estate.
111		-	“(7) “Gift-in-default clause” means a clause identifying a taker in default of
112		-	appointment.
113		-	“(8) “Impermissible appointee” means a person that is not a permissible
114		-	appointee.
115		-	“(9) “Instrument” means a writing.
116		-	“(10) “Nongeneral power of appointment” means a power of appointment that is
117		-	not a general power of appointment.
118		-	“(11) “Permissible appointee” means a person in whose favor a powerholder may
119		-	exercise a power of appointment.
120		-	“(12) “Person” means an individual, estate, trust, business or nonprofit entity,
121		-	public corporation, government or governmental subdivision, agency, or instrumentality, or other
122		-	legal entity.
123		-	“(13) “Power of appointment” means a power that enables a powerholder acting
124		-	in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of
125		-	appointment over the appointive property. The term “power of appointment” does not include a
126		-	power of attorney.
127		-	“(14) “Powerholder” means a person in which a donor creates a power of
128		-	appointment.
129		-	“(15)(A) “Presently exercisable power of appointment” means a power of
130		-	appointment exercisable by the powerholder at the relevant time. ENROLLED ORIGINAL
	69	+	“§ 19-1703.09. Capture doctrine: disposition of ineffectively appointed property under general 40
	70	+	power. 41
	71	+	“§ 19-1703.10. Disposition of unappointed property under released or unexercised general 42
	72	+	power. 43
	73	+	“§ 19-1703.11. Disposition of unappointed property under released or unexercised nongeneral 44
	74	+	power. 45
	75	+	“§ 19-1703.12. Disposition of unappointed property if partial appointment to taker in default. 46
	76	+	“§ 19-1703.13. Appointment to taker in default. 47
	77	+	“§ 19-1703.14. Powerholder’s authority to revoke or amend exercise. 48
	78	+	“SUBCHAPTER IV. DISCLAIMER OR RELEASE; CONTRACT TO APPOINT OR NOT TO 49
	79	+	APPOINT. 50
	80	+	“§ 19-1704.01. Disclaimer. 51
	81	+	“§ 19-1704.02. Authority to release. 52
	82	+	“§ 19-1704.03. Method of release. 53
	83	+	“§ 19-1704.04. Revocation or amendment of release. 54
	84	+	“§ 19-1704.05. Power to contract: presently exercisable power of appointment. 55
	85	+	“§ 19-1704.06. Power to contract: power of appointment not presently exercisable. 56
	86	+	“§ 19-1704.07. Remedy for breach of contract to appoint or not to appoint. 57
	87	+	“SUBCHAPTER V. RIGHTS OF POWERHOLDER’S CREDITORS IN APPOINTIVE 58
	88	+	PROPERTY. 59 ENGROSSED ORIGINAL
	89	+
131	90
132	91
133	92
134	93		4
135	94
136		-	“(B) The term “presently exercisable power of appointment” includes a
137		-	power of appointment not exercisable until the occurrence of a specified event, the satisfaction of
138		-	an ascertainable standard, or the passage of a specified time only after:
139		-	“(i) The occurrence of the specified event;
140		-	“(ii) The satisfaction of the ascertainable standard; or
141		-	“(iii) The passage of the specified time.
142		-	“(C) The term “presently exercisable power of appointment” does not
143		-	include a power of appointment exercisable only at the powerholder’s death.
144		-	“(16) “Specific- exercise clause” means a clause in an instrument which
145		-	specifically refers to and exercises a particular power of appointment.
146		-	“(17) “Taker in default of appointment” means a person that takes all or part of
147		-	the appointive property to the extent the powerholder does not effectively exercise the power of
148		-	appointment.
149		-	“(18) “Terms of the instrument” means the manifestation of the intent of the
150		-	maker of the instrument regarding the instrument’s provisions as expressed in the instrument or
151		-	as may be established by other evidence that would be admissible in a legal proceeding.
152		-	“§ 19- 1701.03. Governing law.
153		-	“Unless the terms of the instrument creating a power of appointment manifest a contrary
154		-	intent:
155		-	“(1) The creation, revocation, or amendment of the power is governed by the law
156		-	of the donor’s domicile at the relevant time; and
157		-	“(2) The exercise, release, or disclaimer of the power, or the revocation or
158		-	amendment of the exercise, release, or disclaimer of the power, is governed by the law of the
159		-	powerholder’s domicile at the relevant time.
160		-	“§ 19- 1701.04. Common law and principles of equity.
161		-	“The common law and principles of equity supplement this chapter, except to the extent
162		-	modified by this chapter or law of the District of Columbia other than this chapter.
163		-	“SUBCHAPTER II. CREATION, REVOCATION, AND AMENDMENT OF POWER OF
164		-	APPOINTMENT.
165		-	“§ 19- 1702.01. Creation of power of appointment.
166		-	“(a) A power of appointment is created only if:
167		-	“(1) The instrument creating the power:
168		-	“(A) Is valid under applicable law; and
169		-	“(B) Except as otherwise provided in subsection (b) of this section,
170		-	transfers the appointive property; and
171		-	“(2) The terms of the instrument creating the power manifest the donor’s intent to
172		-	create in a powerholder a power of appointment over the appointive property exercisable in favor
173		-	of a permissible appointee.
174		-	“(b) Subsection (a)(1)(B) of this section does not apply to the creation of a power of
175		-	appointment by the exercise of a power of appointment.
176		-	“(c) A power of appointment may not be created in a deceased individual. ENROLLED ORIGINAL
	95	+	“§ 19-1705.01. Creditor claim: general power created by powerholder. 60
	96	+	“§ 19-1705.02. creditor claim: general power not created by powerholder. 61
	97	+	“§ 19-1705.03. Power to withdraw. 62
	98	+	“§ 19-1705.04. Creditor claim: nongeneral power. 63
	99	+	“SUBCHAPTER VI. MISCELLANEOUS PROVISIONS. 64
	100	+	“§ 19-1706.01. Uniformity of application and construction. 65
	101	+	“§ 19-1706.02. Relation to electronic signatures in global and national commerce act. 66
	102	+	“§ 19-1706.03. Application to existing relationships. 67
	103	+	“SUBCHAPTER I. GENERAL PROVISIONS. 68
	104	+	“§ 19- 1701.01. Short title. 69
	105	+	“This chapter may be cited as the “ Uniform Powers of Appointment Code ”. 70
	106	+	“§ 19- 1701.02. Definitions. 71
	107	+	“For the purposes of this chapter, the term: 72
	108	+	“(1) “Appointee” means a person to which a powerholder makes an appointment 73
	109	+	of appointive property. 74
	110	+	“(2) “Appointive property” means the property or property interest subject to a 75
	111	+	power of appointment. 76
	112	+	“(3) “Blanket-exercise clause” means a clause in an instrument which exercises a 77
	113	+	power of appointment and is not a specific-exercise clause. The term “blanket-exercise clause” 78
	114	+	includes a clause that: 79 ENGROSSED ORIGINAL
	115	+
177	116
178	117
179	118
180	119		5
181	120
182		-	“(d) Subject to an applicable rule against perpetuities, a power of appointment may be
183		-	created in an unborn or unascertained powerholder.
184		-	“§ 19- 1702.02. Nontransferability.
185		-	“A powerholder may not transfer a power of appointment. If a powerholder dies without
186		-	exercising or releasing a power, the power lapses.
187		-	“§ 19- 1702.03. Presumption of unlimited authority.
188		-	“Subject to § 19- 1702.05, and unless the terms of the instrument creating a power of
189		-	appointment manifest a contrary intent, the power is:
190		-	“(1) Presently exercisable;
191		-	“(2) Exclusionary; and
192		-	“(3) Except as otherwise provided in § 19- 1702.04, general.
193		-	“§ 19- 1702.04. Exception to presumption of unlimited authority.
194		-	“Unless the terms of the instrument creating a power of appointment manifest a contrary
195		-	intent, the power is nongeneral if:
196		-	“(1) The power is exercisable only at the powerholder’s death; and
197		-	“(2) The permissible appointees of the power are a defined and limited class that
198		-	does not include the powerholder’s estate, the powerholder’s creditors, or the creditors of the
199		-	powerholder’s estate.
200		-	“§ 19- 1702.05. Rules of classification.
201		-	“(a) In this section, the term “adverse party” means a person with a substantial beneficial
202		-	interest in property which would be affected adversely by a powerholder’s exercise or
203		-	nonexercise of a power of appointment in favor of the powerholder, the powerholder’s estate, a
204		-	creditor of the powerholder, or a creditor of the powerholder’s estate.
205		-	“(b) If a powerholder may exercise a power of appointment only with the consent or
206		-	joinder of an adverse party, the power is nongeneral.
207		-	“(c) If the permissible appointees of a power of appointment are not defined and limited,
208		-	the power is exclusionary.
209		-	“§ 19- 1702.06. Power to revoke or amend.
210		-	“A donor may revoke or amend a power of appointment only to the extent that:
211		-	“(1) The instrument creating the power is revocable by the donor; or
212		-	“(2) The donor reserves a power of revocation or amendment in the instrument
213		-	creating the power of appointment.
214		-	“SUBCHAPTER III. EXERCISE OF POWER OF APPOINTMENT.
215		-	“§ 19- 1703.01. Requisites for exercise of power of appointment.
216		-	“A power of appointment is exercised only:
217		-	“(1) If the instrument exercising the power is valid under applicable law;
218		-	“(2) If the terms of the instrument exercising the power:
219		-	“(A) Manifest the powerholder’s intent to exercise the power; and
220		-	“(B) Subject to § 19- 1703.04, satisfy the requirements of exercise, if any,
221		-	imposed by the donor; and
222		-	“(3) To the extent the appointment is a permissible exercise of the power. ENROLLED ORIGINAL
	121	+	“(A) Expressly uses the words “any power” in exercising any power of 80
	122	+	appointment the powerholder has; 81
	123	+	“(B) Expressly uses the words “any property” in appointing any property 82
	124	+	over which the powerholder has a power of appointment; or 83
	125	+	“(C) Disposes of all property subject to disposition by the powerholder. 84
	126	+	“(4) “Donor” means a person that creates a power of appointment. 85
	127	+	“(5) “Exclusionary power of appointment” means a power of appointment 86
	128	+	exercisable in favor of any one or more of the permissible appointees to the exclusion of the 87
	129	+	other permissible appointees. 88
	130	+	“(6) “General power of appointment” means a power of appointment exercisable 89
	131	+	in favor of the powerholder, the powerholder’s estate, a creditor of the powerholder, or a creditor 90
	132	+	of the powerholder’s estate. 91
	133	+	“(7) “Gift-in-default clause” means a clause identifying a taker in default of 92
	134	+	appointment. 93
	135	+	“(8) “Impermissible appointee” means a person that is not a permissible 94
	136	+	appointee. 95
	137	+	“(9) “Instrument” means a writing. 96
	138	+	“(10) “Nongeneral power of appointment” means a power of appointment that is 97
	139	+	not a general power of appointment. 98 ENGROSSED ORIGINAL
	140	+
223	141
224	142
225	143
226	144		6
227	145
228		-	“§ 19- 1703.02. Intent to exercise: determining intent from residuary clause.
229		-	“(a) For the purposes of this section, the term:
230		-	“(1) “Residuary clause” does not include a residuary clause containing a blanket-
231		-	exercise clause or a specific- exercise clause.
232		-	“(2) “Will” includes a codicil and a testamentary instrument that revises another
233		-	will.
234		-	“(b) A residuary clause in a powerholder’s will, or a comparable clause in the
235		-	powerholder’s revocable trust, manifests the powerholder’s intent to exercise a power of
236		-	appointment only if:
237		-	“(1) The terms of the instrument containing the residuary clause do not manifest a
238		-	contrary intent;
239		-	“(2) The power is a general power exercisable in favor of the powerholder’s
240		-	estate;
241		-	“(3) There is no gift-in-default clause or the clause is ineffective; and
242		-	“(4) The powerholder did not release the power.
243		-	“§ 19- 1703.03. Intent to exercise after-acquired power.
244		-	“Unless the terms of the instrument exercising a power of appointment manifest a
245		-	contrary intent:
246		-	“(1) Except as otherwise provided in paragraph (2) of this section, a blanket-
247		-	exercise clause extends to a power acquired by the powerholder after executing the instrument
248		-	containing the clause; and
249		-	“(2) If the powerholder is also the donor of the power, the clause does not extend
250		-	to the power unless there is no gift-in-default clause or the gift-in-default clause is ineffective.
251		-	“§ 19- 1703.04. Substantial compliance with donor-imposed formal requirement.
252		-	“A powerholder’s substantial compliance with a formal requirement of appointment
253		-	imposed by the donor, including a requirement that the instrument exercising the power of
254		-	appointment make reference or specific reference to the power, is sufficient if:
255		-	“(1) The powerholder knows of and intends to exercise the power; and
256		-	“(2) The powerholder’s manner of attempted exercise of the power does not
257		-	impair a material purpose of the donor in imposing the requirement.
258		-	“§ 19- 1703.05. Permissible appointment.
259		-	“(a) A powerholder of a general power of appointment that permits appointment to the
260		-	powerholder or the powerholder’s estate may make any appointment, including an appointment
261		-	in trust or creating a new power of appointment, that the powerholder could make in disposing of
262		-	the powerholder’s own property.
263		-	“(b) A powerholder of a general power of appointment that permits appointment only to
264		-	the creditors of the powerholder or of the powerholder’s estate may appoint only to those
265		-	creditors.
266		-	“(c) Unless the terms of the instrument creating a power of appointment manifest a
267		-	contrary intent, the powerholder of a nongeneral power may: ENROLLED ORIGINAL
	146	+	“(11) “Permissible appointee” means a person in whose favor a powerholder may 99
	147	+	exercise a power of appointment. 100
	148	+	“(12) “Person” means an individual, estate, trust, business or nonprofit entity, 101
	149	+	public corporation, government or governmental subdivision, agency, or instrumentality, or other 102
	150	+	legal entity. 103
	151	+	“(13) “Power of appointment” means a power that enables a powerholder acting 104
	152	+	in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of 105
	153	+	appointment over the appointive property. The term “power of appointment” does not include a 106
	154	+	power of attorney. 107
	155	+	“(14) “Powerholder” means a person in which a donor creates a power of 108
	156	+	appointment. 109
	157	+	“(15)(A) “Presently exercisable power of appointment” means a power of 110
	158	+	appointment exercisable by the powerholder at the relevant time. 111
	159	+	“(B) The term “presently exercisable power of appointment” includes a 112
	160	+	power of appointment not exercisable until the occurrence of a specified event, the satisfaction of 113
	161	+	an ascertainable standard, or the passage of a specified time only after: 114
	162	+	“(i) The occurrence of the specified event; 115
	163	+	“(ii) The satisfaction of the ascertainable standard; or 116
	164	+	“(iii) The passage of the specified time. 117 ENGROSSED ORIGINAL
	165	+
268	166
269	167
270	168
271	169		7
272	170
273		-	“(1) Make an appointment in any form, including an appointment in trust, in favor
274		-	of a permissible appointee;
275		-	“(2) Create a general power in a permissible appointee;
276		-	“(3) Create a nongeneral power in any person to appoint to one or more of the
277		-	permissible appointees of the original nongeneral power; and
278		-	“(4) Create a nongeneral power in a permissible appointee to appoint to one or
279		-	more persons if the permissible appointees of the new nongeneral power include the permissible
280		-	appointees of the original nongeneral power.
281		-	“§ 19- 1703.06. Appointment to deceased appointee or permissible appointee’s
282		-	descendant.
283		-	“(a) Subject to § 18- 308, an appointment to a deceased appointee is ineffective.
284		-	“(b) Unless the terms of the instrument creating a power of appointment manifest a
285		-	contrary intent, a powerholder of a nongeneral power may exercise the power in favor of, or
286		-	create a new power of appointment in, a descendant of a deceased permissible appointee whether
287		-	or not the descendant is described by the donor as a permissible appointee.
288		-	“§ 19- 1703.07. Impermissible appointment.
289		-	“(a) Except as otherwise provided in § 19- 1703.06, an exercise of a power of
290		-	appointment in favor of an impermissible appointee is ineffective.
291		-	“(b) An exercise of a power of appointment in favor of a permissible appointee is
292		-	ineffective to the extent the appointment is a fraud on the power.
293		-	“§ 19- 1703.08. Selective allocation doctrine.
294		-	“If a powerholder exercises a power of appointment in a disposition that also disposes of
295		-	property the powerholder owns, the owned property and the appointive property must be
296		-	allocated in the permissible manner that best carries out the powerholder’s intent.
297		-	“§ 19- 1703.09. Capture doctrine: disposition of ineffectively appointed property under
298		-	general power.
299		-	“To the extent a powerholder of a general power of appointment, other than a power to
300		-	withdraw property from, revoke, or amend a trust, makes an ineffective appointment:
301		-	“(1) The gift-in-default clause controls the disposition of the ineffectively
302		-	appointed property; or
303		-	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective,
304		-	the ineffectively appointed property:
305		-	“(A) Passes to:
306		-	“(i) The powerholder if the powerholder is a permissible appointee
307		-	and living; or
308		-	“(ii) If the powerholder is an impermissible appointee or deceased,
309		-	the powerholder’s estate if the estate is a permissible appointee; or
310		-	“(B) If there is no taker under subparagraph (A) of this paragraph, passes
311		-	under a reversionary interest to the donor or the donor’s transferee or successor in interest.
312		-	“§ 19- 1703.10. Disposition of unappointed property under released or unexercised
313		-	general power. ENROLLED ORIGINAL
	171	+	“(C) The term “presently exercisable power of appointment” does not 118
	172	+	include a power of appointment exercisable only at the powerholder’s death. 119
	173	+	“(16) “Specific- exercise clause” means a clause in an instrument which 120
	174	+	specifically refers to and exercises a particular power of appointment. 121
	175	+	“(17) “Taker in default of appointment” means a person that takes all or part of 122
	176	+	the appointive property to the extent the powerholder does not effectively exercise the power of 123
	177	+	appointment. 124
	178	+	“(18) “Terms of the instrument” means the manifestation of the intent of the 125
	179	+	maker of the instrument regarding the instrument’s provisions as expressed in the instrument or 126
	180	+	as may be established by other evidence that would be admissible in a legal proceeding. 127
	181	+	“§ 19- 1701.03. Governing law. 128
	182	+	“Unless the terms of the instrument creating a power of appointment manifest a contrary 129
	183	+	intent, the law of the powerholder’s domicile at the relevant time governs: 130
	184	+	“(1) The creation, revocation, or amendment of the power is governed by the law 131
	185	+	of the donor’s domicile at the relevant time; and 132
	186	+	“(2) The exercise, release, or disclaimer of the power, or the revocation or 133
	187	+	amendment of the exercise, release, or disclaimer of the power, is governed by the law of the 134
	188	+	powerholder’s domicile at the relevant time. 135
	189	+	“§ 19- 1701.04. Common law and principles of equity. 136 ENGROSSED ORIGINAL
	190	+
314	191
315	192
316	193
317	194		8
318	195
319		-	“To the extent a powerholder releases or fails to exercise a general power of appointment
320		-	other than a power to withdraw property from, revoke, or amend a trust:
321		-	“(1) The gift-in-default clause controls the disposition of the unappointed
322		-	property; or
323		-	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective:
324		-	“(A) Except as otherwise provided in subparagraph (B) of this paragraph,
325		-	the unappointed property passes to:
326		-	“(i) The powerholder if the powerholder is a permissible appointee
327		-	and living; or
328		-	“(ii) If the powerholder is an impermissible appointee or deceased,
329		-	the powerholder’s estate if the estate is a permissible appointee; or
330		-	“(B) To the extent the powerholder released the power, or if there is no
331		-	taker under subparagraph (A) of this paragraph, the unappointed property passes under a
332		-	reversionary interest to the donor or the donor’s transferee or successor in interest.
333		-	“§ 19- 1703.11. Disposition of unappointed property under released or unexercised
334		-	nongeneral power.
335		-	“To the extent a powerholder releases, ineffectively exercises, or fails to exercise a
336		-	nongeneral power of appointment:
337		-	“(1) The gift-in-default clause controls the disposition of the unappointed
338		-	property; or
339		-	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective,
340		-	the unappointed property:
341		-	“(A) Passes to the permissible appointees if:
342		-	“(i) The permissible appointees are defined and limited; and
343		-	“(ii) The terms of the instrument creating the power do not
344		-	manifest a contrary intent; or
345		-	“(B) If there is no taker under subparagraph (A) of this paragraph, passes
346		-	under a reversionary interest to the donor or the donor’s transferee or successor in interest.
347		-	“§ 19- 1703.12. Disposition of unappointed property if partial appointment to taker in
348		-	default.
349		-	“Unless the terms of the instrument creating or exercising a power of appointment
350		-	manifest a contrary intent, if the powerholder makes a valid partial appointment to a taker in
351		-	default of appointment, the taker in default of appointment may share fully in unappointed
352		-	property.
353		-	“§ 19- 1703.13. Appointment to taker in default.
354		-	“If a powerholder makes an appointment to a taker in default of appointment and the
355		-	appointee would have taken the property under a gift-in-default clause had the property not been
356		-	appointed, the power of appointment is deemed not to have been exercised and the appointee
357		-	takes under the clause.
358		-	“§ 19- 1703.14. Powerholder’s authority to revoke or amend exercise. ENROLLED ORIGINAL
	196	+	“The common law and principles of equity supplement this chapter, except to the extent 137
	197	+	modified by this chapter or law of the District of Columbia other than this chapter. 138
	198	+	“SUBCHAPTER II. CREATION, REVOCATION, AND AMENDMENT OF POWER OF 139
	199	+	APPOINTMENT. 140
	200	+	“§ 19- 1702.01. Creation of power of appointment. 141
	201	+	“(a) A power of appointment is created only if: 142
	202	+	“(1) The instrument creating the power: 143
	203	+	“(A) Is valid under applicable law; and 144
	204	+	“(B) Except as otherwise provided in subsection (b) of this section, 145
	205	+	transfers the appointive property; and 146
	206	+	“(2) The terms of the instrument creating the power manifest the donor’s intent to 147
	207	+	create in a powerholder a power of appointment over the appointive property exercisable in favor 148
	208	+	of a permissible appointee. 149
	209	+	“(b) Subsection (a)(1)(B) of this section does not apply to the creation of a power of 150
	210	+	appointment by the exercise of a power of appointment. 151
	211	+	“(c) A power of appointment may not be created in a deceased individual. 152
	212	+	“(d) Subject to an applicable rule against perpetuities, a power of appointment may be 153
	213	+	created in an unborn or unascertained powerholder. 154
	214	+	“§ 19- 1702.02. Nontransferability. 155 ENGROSSED ORIGINAL
	215	+
359	216
360	217
361	218
362	219		9
363	220
364		-	“A powerholder may revoke or amend an exercise of a power of appointment only to the
365		-	extent that:
366		-	“(1) The powerholder reserves a power of revocation or amendment in the
367		-	instrument exercising the power of appointment and, if the power is nongeneral, the terms of the
368		-	instrument creating the power of appointment do not prohibit the reservation; or
369		-	“(2) The terms of the instrument creating the power of appointment provide that
370		-	the exercise is revocable or amendable.
371		-	“SUBCHAPTER IV. DISCLAIMER OR RELEASE; CONTRACT TO APPOINT OR NOT TO
372		-	APPOINT.
373		-	“§ 19- 1704.01. Disclaimer.
374		-	“As provided by Chapter 15 of this Title :
375		-	“(1) A powerholder may disclaim all or part of a power of appointment; and
376		-	“(2) A permissible appointee, appointee, or taker in default of appointment may
377		-	disclaim all or part of an interest in appointive property.
378		-	“§ 19- 1704.02. Authority to release.
379		-	“A powerholder may release a power of appointment, in whole or in part, except to the
380		-	extent the terms of the instrument creating the power prevent the release.
381		-	“§ 19- 1704.03. Method of release.
382		-	“(a) For the purposes of this section, the term “record” means information that is
383		-	inscribed on a tangible medium or that is stored in an electronic or other medium and is
384		-	retrievable in perceivable form.
385		-	“(b) A powerholder of a releasable power of appointment may release the power in whole
386		-	or in part:
387		-	“(1) By substantial compliance with a method provided in the terms of the
388		-	instrument creating the power; or
389		-	“(2) If the terms of the instrument creating the power do not provide a method or
390		-	the method provided in the terms of the instrument is not expressly made exclusive, by a record
391		-	manifesting the powerholder’s intent by clear and convincing evidence.
392		-	“§ 19- 1704.04. Revocation or amendment of release.
393		-	“A powerholder may revoke or amend a release of a power of appointment only to the
394		-	extent that:
395		-	“(1) The instrument of release is revocable by the powerholder; or
396		-	“(2) The powerholder reserves a power of revocation or amendment in the
397		-	instrument of release.
398		-	“§ 19- 1704.05. Power to contract: presently exercisable power of appointment.
399		-	“A powerholder of a presently exercisable power of appointment may contract:
400		-	“(1) Not to exercise the power; or
401		-	“(2) To exercise the power if the contract when made does not confer a benefit on
402		-	an impermissible appointee.
403		-	“§ 19- 1704.06. Power to contract: power of appointment not presently exercisable. ENROLLED ORIGINAL
	221	+	“A powerholder may not transfer a power of appointment. If a powerholder dies without 156
	222	+	exercising or releasing a power, the power lapses. 157
	223	+	“§ 19- 1702.03. Presumption of unlimited authority. 158
	224	+	“Subject to § 19- 1702.05, and unless the terms of the instrument creating a power of 159
	225	+	appointment manifest a contrary intent, the power is: 160
	226	+	“(1) Presently exercisable; 161
	227	+	“(2) Exclusionary; and 162
	228	+	“(3) Except as otherwise provided in § 19- 1702.04, general. 163
	229	+	“§ 19- 1702.04. Exception to presumption of unlimited authority. 164
	230	+	“Unless the terms of the instrument creating a power of appointment manifest a contrary 165
	231	+	intent, the power is nongeneral if: 166
	232	+	“(1) The power is exercisable only at the powerholder’s death; and 167
	233	+	“(2) The permissible appointees of the power are a defined and limited class that 168
	234	+	does not include the powerholder’s estate, the powerholder’s creditors, or the creditors of the 169
	235	+	powerholder’s estate. 170
	236	+	“§ 19- 1702.05. Rules of classification. 171
	237	+	“(a) In this section, the term “adverse party” means a person with a substantial beneficial 172
	238	+	interest in property which would be affected adversely by a powerholder’s exercise or 173
	239	+	nonexercise of a power of appointment in favor of the powerholder, the powerholder’s estate, a 174
	240	+	creditor of the powerholder, or a creditor of the powerholder’s estate. 175 ENGROSSED ORIGINAL
	241	+
404	242
405	243
406	244
407	245		10
408	246
409		-	“A powerholder of a power of appointment that is not presently exercisable may contract
410		-	to exercise or not to exercise the power only if the powerholder:
411		-	“(1) Is also the donor of the power; and
412		-	“(2) Has reserved the power in a revocable trust.
413		-	“§ 19- 1704.07. Remedy for breach of contract to appoint or not to appoint.
414		-	“The remedy for a powerholder’s breach of a contract to appoint or not to appoint
415		-	appointive property is limited to damages payable out of the appointive property or, if
416		-	appropriate, specific performance of the contract.
417		-	“SUBCHAPTER V. RIGHTS OF POWERHOLDER’S CREDITORS IN APPOINTIVE
418		-	PROPERTY.
419		-	“§ 19- 1705.01. Creditor claim: general power created by powerholder.
420		-	“(a) For the purposes of this section, the term “power of appointment created by the
421		-	powerholder” includes a power of appointment created in a transfer by another person to the
422		-	extent the powerholder contributed value to the transfer.
423		-	“(b) Appointive property subject to a general power of appointment created by the
424		-	powerholder is subject to a claim of a creditor of the powerholder or of the powerholder’s estate
425		-	to the extent provided in §§ 28- 3101 to 28- 3111.
426		-	“(c) Subject to subsection (b) of this section, appointive property subject to a general
427		-	power of appointment created by the powerholder is not subject to a claim of a creditor of the
428		-	powerholder or the powerholder’s estate to the extent the powerholder irrevocably appointed the
429		-	property in favor of a person other than the powerholder or the powerholder’s estate.
430		-	“(d) Subject to subsections (b) and (c) of this section, and notwithstanding the presence
431		-	of a spendthrift provision or whether the claim arose before or after the creation of the power of
432		-	appointment, appointive property subject to a general power of appointment created by the
433		-	powerholder is subject to a claim of a creditor of:
434		-	“(1) The powerholder, to the same extent as if the powerholder owned the
435		-	appointive property, if the power is presently exercisable; and
436		-	“(2) The powerholder’s estate, to the extent the estate is insufficient to satisfy the
437		-	claim and subject to the right of a decedent to direct the source from which liabilities are paid, if
438		-	the power is exercisable at the powerholder’s death.
439		-	“§ 19- 1705.02. Creditor claim: general power not created by powerholder.
440		-	“(a) Except as otherwise provided in subsection (b) of this section, appointive property
441		-	subject to a general power of appointment created by a person other than the powerholder is
442		-	subject to a claim of a creditor of:
443		-	“(1) The powerholder, to the extent the powerholder’s property is insufficient, if
444		-	the power is presently exercisable; and
445		-	“(2) The powerholder’s estate, to the extent the estate is insufficient, subject to the
446		-	right of a decedent to direct the source from which liabilities are paid.
447		-	“(b) Subject to § 19- 1705.04(c), a power of appointment created by a person other than
448		-	the powerholder which is subject to an ascertainable standard relating to an individual’s health, ENROLLED ORIGINAL
	247	+	“(b) If a powerholder may exercise a power of appointment only with the consent or 176
	248	+	joinder of an adverse party, the power is nongeneral. 177
	249	+	“(c) If the permissible appointees of a power of appointment are not defined and limited, 178
	250	+	the power is exclusionary. 179
	251	+	“§ 19- 1702.06. Power to revoke or amend. 180
	252	+	“A donor may revoke or amend a power of appointment only to the extent that: 181
	253	+	“(1) The instrument creating the power is revocable by the donor; or 182
	254	+	“(2) The donor reserves a power of revocation or amendment in the instrument 183
	255	+	creating the power of appointment. 184
	256	+	“SUBCHAPTER III. EXERCISE OF POWER OF APPOINTMENT. 185
	257	+	“§ 19- 1703.01. Requisites for exercise of power of appointment. 186
	258	+	“A power of appointment is exercised only: 187
	259	+	“(1) If the instrument exercising the power is valid under applicable law; 188
	260	+	“(2) If the terms of the instrument exercising the power: 189
	261	+	“(A) Manifest the powerholder’s intent to exercise the power; and 190
	262	+	“(B) Subject to § 19- 1703.04, satisfy the requirements of exercise, if any, 191
	263	+	imposed by the donor; and 192
	264	+	“(3) To the extent the appointment is a permissible exercise of the power. 193
	265	+	“§ 19- 1703.02. Intent to exercise: determining intent from residuary clause. 194
	266	+	“(a) For the purposes of this section, the term: 195 ENGROSSED ORIGINAL
	267	+
449	268
450	269
451	270
452	271		11
453	272
454		-	education, support, or maintenance, within the meaning of 26 U.S.C. § 2041(b)(1)(A) or 26
455		-	U.S.C. § 2514(c)(1), is treated for the purposes of this subchapter as a nongeneral power.
456		-	“§ 19- 1705.03. Power to withdraw.
457		-	“(a) For the purposes of this subchapter, and except as otherwise provided in subsection
458		-	(b) of this section, a power to withdraw property from a trust is treated, during the time the
459		-	power may be exercised, as a presently exercisable general power of appointment to the extent of
460		-	the property subject to the power to withdraw.
461		-	“(b) On the lapse, release, or waiver of a power to withdraw property from a trust, the
462		-	power is treated as a presently exercisable general power of appointment only to the extent the
463		-	value of the property affected by the lapse, release, or waiver exceeds the greater of the amount
464		-	specified in 26 U.S.C. § 2041(b)(2) and 26 U.S.C. § 2514(e) or the amount specified in 26
465		-	U.S.C. § 2503(b), on the effective date of this chapter.
466		-	“§ 19- 1705.04. Creditor claim: nongeneral power.
467		-	“(a) Except as otherwise provided in subsections (b) and (c) of this section, appointive
468		-	property subject to a nongeneral power of appointment is exempt from a claim of a creditor of
469		-	the powerholder or the powerholder’s estate.
470		-	“(b) Appointive property subject to a nongeneral power of appointment is subject to a
471		-	claim of a creditor of the powerholder or the powerholder’s estate to the extent that the
472		-	powerholder owned the property and, reserving the nongeneral power, transferred the property in
473		-	violation of §§ 28- 3101 to 28- 3111.
474		-	“(c) If the initial gift in default of appointment is to the powerholder or the powerholder’s
475		-	estate, a nongeneral power of appointment is treated for purposes of this subchapter as a general
476		-	power.
477		-	“SUBCHAPTER VI. MISCELLANEOUS PROVISIONS.
478		-	“§ 19- 1706.01. Uniformity of application and construction.
479		-	“In applying and construing this chapter , consideration must be given to the need to
480		-	promote uniformity of the law with respect to its subject matter among states that enact it.
481		-	“§ 19- 1706.02. Relation to Electronic Signatures in Global and National Commerce A ct.
482		-	“This chapter modifies, limits, or supersedes the Electronic Signatures in Global and
483		-	National Commerce Act, approved June 30, 2000 (114 Stat. 464; 15 U.S.C. § 7001 et seq. ), but
484		-	does not modify, limit, or supersede section 101(c) of that act (15 U.S.C. § 7001(c)), or authorize
485		-	electronic delivery of any of the notices described in section 103(b) of that act (15 U.S.C. §
486		-	7003(b)).
487		-	“§ 19- 1706.03. Application to existing relationships.
488		-	“(a) Except as otherwise provided in this chapter, on and after the effective date of this
489		-	chapter, the following rules apply:
490		-	“(1) This chapter applies to a power of appointment created before, on, or after
491		-	the effective date of this chapter;
492		-	“(2) This chapter applies to a judicial proceeding concerning a power of
493		-	appointment commenced on or after the effective date of this chapter; ENROLLED ORIGINAL
	273	+	“(1) “Residuary clause” does not include a residuary clause containing a blanket-196
	274	+	exercise clause or a specific- exercise clause. 197
	275	+	“(2) “Will” includes a codicil and a testamentary instrument that revises another 198
	276	+	will. 199
	277	+	“(b) A residuary clause in a powerholder’s will, or a comparable clause in the 200
	278	+	powerholder’s revocable trust, manifests the powerholder’s intent to exercise a power of 201
	279	+	appointment only if: 202
	280	+	“(1) The terms of the instrument containing the residuary clause do not manifest a 203
	281	+	contrary intent; 204
	282	+	“(2) The power is a general power exercisable in favor of the powerholder’s 205
	283	+	estate; 206
	284	+	“(3) There is no gift-in-default clause or the clause is ineffective; and 207
	285	+	“(4) The powerholder did not release the power. 208
	286	+	“§ 19- 1703.03. Intent to exercise after-acquired power. 209
	287	+	“Unless the terms of the instrument exercising a power of appointment manifest a 210
	288	+	contrary intent: 211
	289	+	“(1) Except as otherwise provided in paragraph (2) of this section, a blanket-212
	290	+	exercise clause extends to a power acquired by the powerholder after executing the instrument 213
	291	+	containing the clause; and 214 ENGROSSED ORIGINAL
	292	+
494	293
495	294
496	295
497	296		12
498	297
499		-	“(3) This chapter applies to a judicial proceeding concerning a power of
500		-	appointment commenced before the effective date of this chapter unless the court finds that
501		-	application of a particular provision of this chapter would interfere substantially with the
502		-	effective conduct of the judicial proceeding or prejudice a right of a party, in which case the
503		-	particular provision of this chapter does not apply and the superseded law applies;
504		-	“(4) A rule of construction or presumption provided in this chapter applies to an
505		-	instrument executed before the effective date of this chapter unless there is a clear indication of a
506		-	contrary intent in the terms of the instrument; and
507		-	“(5) Except as otherwise provided in paragraphs (1) through (4) of this
508		-	subsection, an action done before the effective date of this chapter is not affected by this chapter.
509		-	“(b) If a right is acquired, extinguished, or barred on the expiration of a prescribed period
510		-	that commenced under law of the District of Columbia other than this chapter before the
511		-	effective date of this chapter, the law continues to apply to the right.”.
512		-
513		-	Sec. 3. Fiscal impact statement.
514		-	The Council adopts the fiscal impact statement in the committee report as the fiscal
515		-	impact statement required by section 4a of the General Legislative Procedures Act of 1975,
516		-	approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1- 301.47a).
517		-
518		-	Sec. 4. Effective date.
519		-	This act shall take effect following approval by the Mayor (or in the event of veto by the
520		-	Mayor, action by the Council to override the veto), and a 30-day period of congressional review
521		-	as provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December
522		-	24, 1973 (87 Stat. 813; D.C. Official Code § 1- 206.02(c)(1)).
	298	+	“(2) If the powerholder is also the donor of the power, the clause does not extend 215
	299	+	to the power unless there is no gift-in-default clause or the gift-in-default clause is ineffective. 216
	300	+	“§ 19- 1703.04. Substantial compliance with donor-imposed formal requirement. 217
	301	+	“A powerholder’s substantial compliance with a formal requirement of appointment 218
	302	+	imposed by the donor, including a requirement that the instrument exercising the power of 219
	303	+	appointment make reference or specific reference to the power, is sufficient if: 220
	304	+	“(1) The powerholder knows of and intends to exercise the power; and 221
	305	+	“(2) The powerholder’s manner of attempted exercise of the power does not 222
	306	+	impair a material purpose of the donor in imposing the requirement. 223
	307	+	“§ 19- 1703.05. Permissible appointment. 224
	308	+	“(a) A powerholder of a general power of appointment that permits appointment to the 225
	309	+	powerholder or the powerholder’s estate may make any appointment, including an appointment 226
	310	+	in trust or creating a new power of appointment, that the powerholder could make in disposing of 227
	311	+	the powerholder’s own property. 228
	312	+	“(b) A powerholder of a general power of appointment that permits appointment only to 229
	313	+	the creditors of the powerholder or of the powerholder’s estate may appoint only to those 230
	314	+	creditors. 231
	315	+	“(c) Unless the terms of the instrument creating a power of appointment manifest a 232
	316	+	contrary intent, the powerholder of a nongeneral power may: 233 ENGROSSED ORIGINAL
523	317
524	318
525	319
526	320
	321	+	13
527	322
528		-
529		-	______________________________
530		-	Chairman
531		-	Council of the District of Columbia
	323	+	“(1) Make an appointment in any form, including an appointment in trust, in favor 234
	324	+	of a permissible appointee; 235
	325	+	“(2) Create a general power in a permissible appointee; or 236
	326	+	“(3) Create a nongeneral power in any person to appoint to one or more of the 237
	327	+	permissible appointees of the original nongeneral power. 238
	328	+	“§ 19- 1703.06. Appointment to deceased appointee or permissible appointee’s 239
	329	+	descendant. 240
	330	+	“(a) Subject to § 18- 308, an appointment to a deceased appointee is ineffective. 241
	331	+	“(b) Unless the terms of the instrument creating a power of appointment manifest a 242
	332	+	contrary intent, a powerholder of a nongeneral power may exercise the power in favor of, or 243
	333	+	create a new power of appointment in, a descendant of a deceased permissible appointee whether 244
	334	+	or not the descendant is described by the donor as a permissible appointee. 245
	335	+	“§ 19- 1703.07. Impermissible appointment. 246
	336	+	“(a) Except as otherwise provided in § 19- 1703.06, an exercise of a power of 247
	337	+	appointment in favor of an impermissible appointee is ineffective. 248
	338	+	“(b) An exercise of a power of appointment in favor of a permissible appointee is 249
	339	+	ineffective to the extent the appointment is a fraud on the power. 250
	340	+	“§ 19- 1703.08. Selective allocation doctrine. 251 ENGROSSED ORIGINAL
532	341
533	342
534	343
535	344
	345	+	14
536	346
537		-	_________________________________
538		-	Mayor
539		-	District of Columbia
	347	+	“If a powerholder exercises a power of appointment in a disposition that also disposes of 252
	348	+	property the powerholder owns, the owned property and the appointive property must be 253
	349	+	allocated in the permissible manner that best carries out the powerholder’s intent. 254
	350	+	“§ 19- 1703.09. Capture doctrine: disposition of ineffectively appointed property under 255
	351	+	general power. 256
	352	+	“To the extent a powerholder of a general power of appointment, other than a power to 257
	353	+	withdraw property from, revoke, or amend a trust, makes an ineffective appointment: 258
	354	+	“(1) The gift-in-default clause controls the disposition of the ineffectively 259
	355	+	appointed property; or 260
	356	+	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective, 261
	357	+	the ineffectively appointed property: 262
	358	+	“(A) Passes to: 263
	359	+	“(i) The powerholder if the powerholder is a permissible appointee 264
	360	+	and living; or 265
	361	+	“(ii) If the powerholder is an impermissible appointee or deceased, 266
	362	+	the powerholder’s estate if the estate is a permissible appointee; or 267
	363	+	“(B) If there is no taker under subparagraph (A) of this paragraph, passes 268
	364	+	under a reversionary interest to the donor or the donor’s transferee or successor in interest. 269
	365	+	“§ 19- 1703.10. Disposition of unappointed property under released or unexercised 270
	366	+	general power. 271 ENGROSSED ORIGINAL
	367	+
	368	+
	369	+
	370	+
	371	+	15
	372	+
	373	+	“To the extent a powerholder releases or fails to exercise a general power of appointment 272
	374	+	other than a power to withdraw property from, revoke, or amend a trust: 273
	375	+	“(1) The gift-in-default clause controls the disposition of the unappointed 274
	376	+	property; or 275
	377	+	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective: 276
	378	+	“(A) Except as otherwise provided in subparagraph (B) of this paragraph, 277
	379	+	the unappointed property passes to: 278
	380	+	“(i) The powerholder if the powerholder is a permissible appointee 279
	381	+	and living; or 280
	382	+	“(ii) If the powerholder is an impermissible appointee or deceased, 281
	383	+	the powerholder’s estate if the estate is a permissible appointee; or 282
	384	+	“(B) To the extent the powerholder released the power, or if there is no 283
	385	+	taker under subparagraph (A) of this paragraph, the unappointed property passes under a 284
	386	+	reversionary interest to the donor or the donor’s transferee or successor in interest. 285
	387	+	“§ 19- 1703.11. Disposition of unappointed property under released or unexercised 286
	388	+	nongeneral power. 287
	389	+	“To the extent a powerholder releases, ineffectively exercises, or fails to exercise a 288
	390	+	nongeneral power of appointment: 289
	391	+	“(1) The gift-in-default clause controls the disposition of the unappointed 290
	392	+	property; or 291 ENGROSSED ORIGINAL
	393	+
	394	+
	395	+
	396	+
	397	+	16
	398	+
	399	+	“(2) If there is no gift-in-default clause or to the extent the clause is ineffective, 292
	400	+	the unappointed property: 293
	401	+	“(A) Passes to the permissible appointees if: 294
	402	+	“(i) The permissible appointees are defined and limited; and 295
	403	+	“(ii) The terms of the instrument creating the power do not 296
	404	+	manifest a contrary intent; or 297
	405	+	“(B) If there is no taker under subparagraph (A) of this paragraph, passes 298
	406	+	under a reversionary interest to the donor or the donor’s transferee or successor in interest. 299
	407	+	“§ 19- 1703.12. Disposition of unappointed property if partial appointment to taker in 300
	408	+	default. 301
	409	+	“Unless the terms of the instrument creating or exercising a power of appointment 302
	410	+	manifest a contrary intent, if the powerholder makes a valid partial appointment to a taker in 303
	411	+	default of appointment, the taker in default of appointment may share fully in unappointed 304
	412	+	property. 305
	413	+	“§ 19- 1703.13. Appointment to taker in default. 306
	414	+	“If a powerholder makes an appointment to a taker in default of appointment and the 307
	415	+	appointee would have taken the property under a gift-in-default clause had the property not been 308
	416	+	appointed, the power of appointment is deemed not to have been exercised and the appointee 309
	417	+	takes under the clause. 310
	418	+	“§ 19- 1703.14. Powerholder’s authority to revoke or amend exercise. 311 ENGROSSED ORIGINAL
	419	+
	420	+
	421	+
	422	+
	423	+	17
	424	+
	425	+	“A powerholder may revoke or amend an exercise of a power of appointment only to the 312
	426	+	extent that: 313
	427	+	“(1) The powerholder reserves a power of revocation or amendment in the 314
	428	+	instrument exercising the power of appointment and, if the power is nongeneral, the terms of the 315
	429	+	instrument creating the power of appointment do not prohibit the reservation; or 316
	430	+	“(2) The terms of the instrument creating the power of appointment provide that 317
	431	+	the exercise is revocable or amendable. 318
	432	+	“SUBCHAPTER IV. DISCLAIMER OR RELEASE; CONTRACT TO APPOINT OR NOT TO 319
	433	+	APPOINT. 320
	434	+	“§ 19- 1704.01. Disclaimer. 321
	435	+	“As provided by Chapter 15: 322
	436	+	“(1) A powerholder may disclaim all or part of a power of appointment; and 323
	437	+	“(2) A permissible appointee, appointee, or taker in default of appointment may 324
	438	+	disclaim all or part of an interest in appointive property. 325
	439	+	“§ 19- 1704.02. Authority to release. 326
	440	+	“A powerholder may release a power of appointment, in whole or in part, except to the 327
	441	+	extent the terms of the instrument creating the power prevent the release. 328
	442	+	“§ 19- 1704.03. Method of release. 329 ENGROSSED ORIGINAL
	443	+
	444	+
	445	+
	446	+
	447	+	18
	448	+
	449	+	“(a) For the purposes of this section, the term “record” means information that is 330
	450	+	inscribed on a tangible medium or that is stored in an electronic or other medium and is 331
	451	+	retrievable in perceivable form. 332
	452	+	“(b) A powerholder of a releasable power of appointment may release the power in whole 333
	453	+	or in part: 334
	454	+	“(1) By substantial compliance with a method provided in the terms of the 335
	455	+	instrument creating the power; or 336
	456	+	“(2) If the terms of the instrument creating the power do not provide a method or 337
	457	+	the method provided in the terms of the instrument is not expressly made exclusive, by a record 338
	458	+	manifesting the powerholder’s intent by clear and convincing evidence. 339
	459	+	“§ 19- 1704.04. Revocation or amendment of release. 340
	460	+	“A powerholder may revoke or amend a release of a power of appointment only to the 341
	461	+	extent that: 342
	462	+	“(1) The instrument of release is revocable by the powerholder; or 343
	463	+	“(2) The powerholder reserves a power of revocation or amendment in the 344
	464	+	instrument of release. 345
	465	+	“§ 19- 1704.05. Power to contract: presently exercisable power of appointment. 346
	466	+	“A powerholder of a presently exercisable power of appointment may contract: 347
	467	+	“(1) Not to exercise the power; or 348 ENGROSSED ORIGINAL
	468	+
	469	+
	470	+
	471	+
	472	+	19
	473	+
	474	+	“(2) To exercise the power if the contract when made does not confer a benefit on 349
	475	+	an impermissible appointee. 350
	476	+	“§ 19- 1704.06. Power to contract: power of appointment not presently exercisable. 351
	477	+	“A powerholder of a power of appointment that is not presently exercisable may contract 352
	478	+	to exercise or not to exercise the power only if the powerholder: 353
	479	+	“(1) Is also the donor of the power; and 354
	480	+	“(2) Has reserved the power in a revocable trust. 355
	481	+	“§ 19- 1704.07. Remedy for breach of contract to appoint or not to appoint. 356
	482	+	“The remedy for a powerholder’s breach of a contract to appoint or not to appoint 357
	483	+	appointive property is limited to damages payable out of the appointive property or, if 358
	484	+	appropriate, specific performance of the contract. 359
	485	+	“SUBCHAPTER V. RIGHTS OF POWERHOLDER’S CREDITORS IN APPOINTIVE 360
	486	+	PROPERTY. 361
	487	+	“§ 19- 1705.01. Creditor claim: general power created by powerholder. 362
	488	+	“(a) For the purposes of this section, the term “power of appointment created by the 363
	489	+	powerholder” includes a power of appointment created in a transfer by another person to the 364
	490	+	extent the powerholder contributed value to the transfer. 365
	491	+	“(b) Appointive property subject to a general power of appointment created by the 366
	492	+	powerholder is subject to a claim of a creditor of the powerholder or of the powerholder’s estate 367
	493	+	to the extent provided in §§ 28- 3101 to 28- 3111. 368 ENGROSSED ORIGINAL
	494	+
	495	+
	496	+
	497	+
	498	+	20
	499	+
	500	+	“(c) Subject to subsection (b) of this section, appointive property subject to a general 369
	501	+	power of appointment created by the powerholder is not subject to a claim of a creditor of the 370
	502	+	powerholder or the powerholder’s estate to the extent the powerholder irrevocably appointed the 371
	503	+	property in favor of a person other than the powerholder or the powerholder’s estate. 372
	504	+	“(d) Subject to subsections (b) and (c) of this section, and notwithstanding the presence 373
	505	+	of a spendthrift provision or whether the claim arose before or after the creation of the power of 374
	506	+	appointment, appointive property subject to a general power of appointment created by the 375
	507	+	powerholder is subject to a claim of a creditor of: 376
	508	+	“(1) The powerholder, to the same extent as if the powerholder owned the 377
	509	+	appointive property, if the power is presently exercisable; and 378
	510	+	“(2) The powerholder’s estate, to the extent the estate is insufficient to satisfy the 379
	511	+	claim and subject to the right of a decedent to direct the source from which liabilities are paid, if 380
	512	+	the power is exercisable at the powerholder’s death. 381
	513	+	“§ 19- 1705.02. Creditor claim: general power not created by powerholder. 382
	514	+	“(a) Except as otherwise provided in subsection (b) of this section, appointive property 383
	515	+	subject to a general power of appointment created by a person other than the powerholder is 384
	516	+	subject to a claim of a creditor of: 385
	517	+	“(1) The powerholder, to the extent the powerholder’s property is insufficient, if 386
	518	+	the power is presently exercisable; and 387 ENGROSSED ORIGINAL
	519	+
	520	+
	521	+
	522	+
	523	+	21
	524	+
	525	+	“(2) The powerholder’s estate, to the extent the estate is insufficient, subject to the 388
	526	+	right of a decedent to direct the source from which liabilities are paid. 389
	527	+	“(b) Subject to § 19- 1705.04(c), a power of appointment created by a person other than 390
	528	+	the powerholder which is subject to an ascertainable standard relating to an individual’s health, 391
	529	+	education, support, or maintenance, within the meaning of 26 U.S.C. § 2041(b)(1)(A) or 26 392
	530	+	U.S.C. § 2514(c)(1), is treated for the purposes of this subchapter as a nongeneral power. 393
	531	+	“§ 19- 1705.03. Power to withdraw. 394
	532	+	“(a) For the purposes of this subchapter, and except as otherwise provided in subsection 395
	533	+	(b) of this section, a power to withdraw property from a trust is treated, during the time the 396
	534	+	power may be exercised, as a presently exercisable general power of appointment to the extent of 397
	535	+	the property subject to the power to withdraw. 398
	536	+	“(b) On the lapse, release, or waiver of a power to withdraw property from a trust, the 399
	537	+	power is treated as a presently exercisable general power of appointment only to the extent the 400
	538	+	value of the property affected by the lapse, release, or waiver exceeds the greater of the amount 401
	539	+	specified in 26 U.S.C. § 2041(b)(2) and 26 U.S.C. § 2514(e) or the amount specified in 26 402
	540	+	U.S.C. § 2503(b), on the effective date of this chapter. 403
	541	+	“§ 19- 1705.04. Creditor claim: nongeneral power. 404
	542	+	“(a) Except as otherwise provided in subsections (b) and (c) of this section, appointive 405
	543	+	property subject to a nongeneral power of appointment is exempt from a claim of a creditor of 406
	544	+	the powerholder or the powerholder’s estate. 407 ENGROSSED ORIGINAL
	545	+
	546	+
	547	+
	548	+
	549	+	22
	550	+
	551	+	“(b) Appointive property subject to a nongeneral power of appointment is subject to a 408
	552	+	claim of a creditor of the powerholder or the powerholder’s estate to the extent that the 409
	553	+	powerholder owned the property and, reserving the nongeneral power, transferred the property in 410
	554	+	violation of §§ 28- 3101 to 28- 3111. 411
	555	+	“(c) If the initial gift in default of appointment is to the powerholder or the powerholder’s 412
	556	+	estate, a nongeneral power of appointment is treated for purposes of this subchapter as a general 413
	557	+	power. 414
	558	+	“SUBCHAPTER VI. MISCELLANEOUS PROVISIONS. 415
	559	+	“§ 19- 1706.01. Uniformity of application and construction. 416
	560	+	“In applying and construing this chapter , consideration must be given to the need to 417
	561	+	promote uniformity of the law with respect to its subject matter among states that enact it. 418
	562	+	“§ 19- 1706.02. Relation to Electronic Signatures in Global and National Commerce A ct. 419
	563	+	“This chapter modifies, limits, or supersedes the Electronic Signatures in Global and 420
	564	+	National Commerce Act, approved June 30, 2000 (114 Stat. 464; 15 U.S.C. § 7001 et seq. ), but 421
	565	+	does not modify, limit, or supersede § 101(c) of that act (15 U.S.C. § 7001(c)), or authorize 422
	566	+	electronic delivery of any of the notices described in § 103(b) of that act (15 U.S.C. § 7003(b)). 423
	567	+	“§ 19- 1706.03. Application to existing relationships. 424
	568	+	“(a) Except as otherwise provided in this chapter, on and after the effective date of this 425
	569	+	chapter, the following rules apply: 426 ENGROSSED ORIGINAL
	570	+
	571	+
	572	+
	573	+
	574	+	23
	575	+
	576	+	“(1) This chapter applies to a power of appointment created before, on, or after 427
	577	+	the effective date of this chapter; 428
	578	+	“(2) This chapter applies to a judicial proceeding concerning a power of 429
	579	+	appointment commenced on or after the effective date of this chapter; 430
	580	+	“(3) This chapter applies to a judicial proceeding concerning a power of 431
	581	+	appointment commenced before the effective date of this chapter unless the court finds that 432
	582	+	application of a particular provision of this chapter would interfere substantially with the 433
	583	+	effective conduct of the judicial proceeding or prejudice a right of a party, in which case the 434
	584	+	particular provision of this chapter does not apply and the superseded law applies; 435
	585	+	“(4) A rule of construction or presumption provided in this chapter applies to an 436
	586	+	instrument executed before the effective date of this chapter unless there is a clear indication of a 437
	587	+	contrary intent in the terms of the instrument; and 438
	588	+	“(5) Except as otherwise provided in paragraphs (1) through (4) of this 439
	589	+	subsection, an action done before the effective date of this chapter is not affected by this chapter. 440
	590	+	“(b) If a right is acquired, extinguished, or barred on the expiration of a prescribed period 441
	591	+	that commenced under law of the District of Columbia other than this chapter before the 442
	592	+	effective date of this chapter, the law continues to apply to the right.”. 443
	593	+	Sec. 3. Fiscal impact statement. 444 ENGROSSED ORIGINAL
	594	+
	595	+
	596	+
	597	+
	598	+	24
	599	+
	600	+	The Council adopts the fiscal impact statement in the committee report as the fiscal 445
	601	+	impact statement required by section 4a of the General Legislative Procedures Act of 1975, 446
	602	+	approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1- 301.47a). 447
	603	+	Sec. 4. Effective date. 448
	604	+	This act shall take effect following approval by the Mayor (or in the event of veto by the 449
	605	+	Mayor, action by the Council to override the veto), a 30- day period of congressional review as 450
	606	+	provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 451
	607	+	24, 1973 (87 Stat. 813; D.C. Official Code § 1- 206.02(c)(1)). 452