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ACT No. 390
Regular Session, 2010
HOUSE BILL NO. 856
BY REPRESENTATIVE TIM BURNS
(On Recommendation of the Louisiana State Law Institute)
AN ACT1
To amend and reenact R.S. 9:1725(5), 1893, 1895(A), 1971, 2004(2), 2011, 2025, and 20452
and to enact R.S. 9:1973(C), 2031, and 2235, relative to the Louisiana Trust Code;3
to provide for the definition of "proper court"; to provide for class trusts; to provide4
for the interests of beneficiaries; to provide for the correction of cross references; to5
provide relative to the shifting of the interest of a principal beneficiary; to provide6
for the delegation of the right to terminate, modify, or amend certain trust provisions;7
to provide for the delegation of the right to revoke a trust; and to provide for related8
matters.9
Be it enacted by the Legislature of Louisiana:10
Section 1. R.S. 9:1725(5), 1893, 1895(A), 1971, 2004(2), 2011, 2025, and 2045 are11
hereby amended and reenacted and R.S. 9:1973(C), 2031, and 2235 are hereby enacted to12
read as follows: 13
§1725. Definitions14
Except when the context clearly indicates otherwise, as used in this Code:15
* * *16
(5) "Proper court" in the case of an inter vivos trust means the district court17
of the parish designated by the settlor, or if no designation is made, the district court18
of the parish of the trustee's domicile when only one trustee is named, or when more19
than one trustee is named, or when the trustee is a nonresident, the district court of20
the parish where the principal trust property is located, but if the settlor has named21
two or more trustees in the trust instrument and they are domiciled in the same22
parish, the district court of the trustee's domicile shall be the proper court. If the23 ENROLLEDHB NO. 856
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settlor designates the court, he shall designate: (a) the district court of the parish of1
the domicile of the trustee; (b) the district court of the parish of the domicile of the2
settlor; or (c) the district court of the parish where the principal trust property is3
located. "Proper court" in the case of a testamentary trust means the district court4
having jurisdiction of the settlor's succession. "Proper court" means the court as5
determined by the provisions of R.S. 9:2235.6
* * *7
§1893. Income and principal designations8
A class trust may be created with respect to all of or a portion of income or9
principal, or both, but the members of the class must always be the sole beneficiaries10
of the interest affected, whether income, principal, or both of the portion of the trust11
of which they are beneficiaries. Subject to R.S. 9:2068, the trustee may invade12
principal for the benefit of one or more individual income beneficiaries or one or13
more members of any class of income beneficiaries, even though such income14
beneficiary may not be a member of the class of principal beneficiaries. 15
* * *16
§1895. Effect of death of class member during the term of the trust 17
A. An interest of a member of the class who dies during the term of the trust18
vests in his heirs or legatees, but unless the trust instrument may provide provides19
any one of the following:20
(1) That that the interest of a member of the class who dies intestate and21
without descendants during the term of the trust vests in the other members of the22
class, or,.23
(2) Except except as to the legitime in trust, that the interest of a member of24
the class who dies without descendants during the term of the trust or at its25
termination vests in the other members of the class.26
(3) Except as to the legitime in trust, that the interest of a member of the27
class who dies leaving one or more descendants vests in the beneficiary's descendant28
heirs.29
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§1971. Time of acquisition of interest1
The interest of a principal beneficiary is acquired immediately upon the2
creation of a trust, subject to the exceptions provided in this Code and in Civil Code3
Article 1521(A)(2).4
* * *5
§1973. Shifting interest in principal6
* * *7
C. The trust instrument may provide that the interest of a designated8
principal beneficiary of a revocable trust shifts to another person or persons, if the9
substitution occurs no later than the date when the trust becomes irrevocable.10
* * *11
§2004. Seizure by creditor; general rule12
A creditor may seize only:13
* * *14
(2) A beneficiary's interest in income and principal, to the extent that the15
beneficiary has donated property to the trust, directly or indirectly. A beneficiary16
will not be deemed to have donated property to a trust merely because he fails to17
exercise a right of withdrawal from the trust.18
* * *19
§2011. General rule 20
A revocable trust instrument need not designate the beneficiaries upon the21
creation of the trust but may instead provide a method whereby they are determined22
at a later time date, but no later than the time date when the trust becomes23
irrevocable. A beneficiary thus determined may be a person who is not in being24
when the trust is created, as long as he is in being when the beneficiaries are25
determined. If beneficiaries are thus determined, any provision in this Code that26
refers to persons in existence at the creation of the trust shall be deemed to refer to27
persons in existence at the time when the beneficiaries are determined under the trust28 ENROLLEDHB NO. 856
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instrument. The interest of the beneficiary may be conditioned upon the beneficiary1
surviving the settlor for a period of time permitted by Civil Code Article 1521(A)(2).2
* * *3
§2025. Delegation of right to terminate or to modify administrative provisions4
A settlor may delegate to another person the right to terminate a trust, or to5
modify the administrative provisions of a trust, but the right to modify other6
provisions of a trust may not be delegated except as provided in R.S. 9:2031.7
* * *8
§2031. Delegation of right to amend9
A trust instrument may authorize a person other than the settlor to modify the10
provisions of the trust instrument in order to add or remove beneficiaries, or modify11
their rights, if all of the affected beneficiaries are descendants of the person given the12
power to modify.13
Comment14
A power to amend granted under this Section will not be allowed to the15
extent that the exercise of the power would impinge on a beneficiary’s legitime held16
in the trust. See R.S. 9:1841.17
* * *18
§2045. Delegation of right to revoke19
A settlor who has reserved the right to revoke a trust may delegate that the20
right. only by an express statement in the trust instrument or in a power of attorney21
executed in authentic form referring to the trust. The delegation may be22
accomplished only by an express statement in the trust instrument or in a power of23
attorney executed by authentic act referring to the trust. The right to amend may not24
be delegated except as provided in R.S. 9:2025 and 2031.25
* * *26
§2235. Proper court27
The proper court for an action under this Chapter shall be determined as28
follows:29
A.(1) In the case of an inter vivos trust, the proper court shall be the district30 ENROLLEDHB NO. 856
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court of any parish that the trust instrument effectively designates as the proper court.1
(2) If the trust instrument fails to designate a proper court for an inter vivos2
trust, any of the following are proper courts:3
(a) The district court of the parish in which a settlor was domiciled when the4
trust was created.5
(b) If the trust has a trustee domiciled in Louisiana, the district court of the6
parish in which a trustee is domiciled.7
(c) If the trust has no trustee domiciled in Louisiana, the district court in8
which the agent for service of process of any nonresident trustee is domiciled.9
(3) If the trust instrument fails to designate a proper court for an inter vivos10
trust, and none of the courts specified in Paragraph (2) of this Subsection are11
available, the proper court shall be the Nineteenth Judicial District Court.12
B. In the case of a testamentary trust, the proper court shall be the district13
court of the parish having jurisdiction over the settlor's succession, which shall14
continue as the proper court unless the settlor in the trust instrument has designated15
a proper court. In that event, the settlor's designation shall be effective after the16
trustee is put into possession of the entire legacy.17
C. The foregoing notwithstanding, in the case of a testamentary trust after18
the trustee is put into possession of the entire legacy, and in the case of any inter19
vivos trust, the proper court shall be any court agreed to by all trustees, beneficiaries,20
and living settlors.21
D. Once a matter regarding an inter vivos trust has been litigated in a district22
court, that court shall continue as the sole proper court absent the agreement23
described in Subsection C of this Section.24
E. Amendments to a trust instrument that attempt to designate a proper court25
after institution of an action shall have no effect on the selection of the proper court.26 ENROLLEDHB NO. 856
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Section 2. The provisions of this Act shall apply to all trusts, whether created before1
or after the effective date of this Act, but R.S. 9:1895(A)(3) shall apply only to substitutions2
occurring after the effective date of this Act.3
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: