MD
Maryland House Bill HB1049

Maryland 2022 Regular Session

Maryland House Bill HB1049 Compare Versions

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1- LAWRENCE J. HOGAN, JR., Governor Ch. 632
21
3-– 1 –
4-Chapter 632
5-(House Bill 1049)
62
7-AN ACT concerning
3+EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4+ [Brackets] indicate matter deleted from existing law.
5+ Underlining indicates amendments to bill.
6+ Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7+amendment.
8+ *hb1049*
89
9-Maryland Trust Act – Trustee Liability – Release by Interested Parties
10+HOUSE BILL 1049
11+N2 2lr2747
12+ CF SB 878
13+By: Delegate Cardin
14+Introduced and read first time: February 10, 2022
15+Assigned to: Judiciary
16+Committee Report: Favorable
17+House action: Adopted
18+Read second time: March 10, 2022
1019
11-FOR the purpose of altering a provision of law providing that a trustee seeking a release of
12-the trustee from liability for administration of a trust send a certain interested party
13-a certain report; providing for the submission of a statement by an interested party
14-to a trust under the Maryland Trust Act that the interested party does not object to
15-the release from liability of a trustee for administration of the trust under certain
16-circumstances; authorizing the distribution of trust property when all interested
17-parties submit a certain statement; and generally relating to the Maryland Trust
18-Act and trustee liability.
20+CHAPTER ______
1921
20-BY repealing and reenacting, with amendments,
21- Article – Estates and Trusts
22-Section 14.5–907
23- Annotated Code of Maryland
24- (2017 Replacement Volume and 2021 Supplement)
22+AN ACT concerning 1
2523
26- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
27-That the Laws of Maryland read as follows:
24+Maryland Trust Act – Trustee Liability – Release by Interested Parties 2
2825
29-Article – Estates and Trusts
26+FOR the purpose of altering a provision of law providing that a trustee seeking a release of 3
27+the trustee from liability for administration of a trust send a certain interested party 4
28+a certain report; providing for the submission of a statement by an interested party 5
29+to a trust under the Maryland Trust Act that the interested party does not object to 6
30+the release from liability of a trustee for administration of the trust under certain 7
31+circumstances; authorizing the distribution of trust property when all interested 8
32+parties submit a certain statement; and generally relating to the Maryland Trust 9
33+Act and trustee liability. 10
3034
31-14.5–907.
35+BY repealing and reenacting, with amendments, 11
36+ Article – Estates and Trusts 12
37+Section 14.5–907 13
38+ Annotated Code of Maryland 14
39+ (2017 Replacement Volume and 2021 Supplement) 15
3240
33- (a) In this section, “interested party” means a beneficiary, representative of a
34-beneficiary, co–trustee, successor trustee, or any other person having an interest in or
35-authority over a trust.
41+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
42+That the Laws of Maryland read as follows: 17
3643
37- (b) A trustee is not liable to a beneficiary for breach of trust if the beneficiary
38-consented to the conduct constituting the breach, released the trustee from liability for the
39-breach, or ratified the transaction constituting the breach, unless:
44+Article – Estates and Trusts 18
4045
41- (1) The consent, release, or ratification of the beneficiary was induced by
42-improper conduct of the trustee; or
46+14.5–907. 19
4347
44- (2) At the time of the consent, release, or ratification, the beneficiary did
45-not know of the rights of the beneficiary or of the material facts relating to the breach.
48+ (a) In this section, “interested party” means a beneficiary, representative of a 20 2 HOUSE BILL 1049
4649
47- (c) (1) When a trust terminates in accordance with the terms of the trust or
48-Subtitle 4 of this title, or on the removal or resignation of a trustee in accordance with the
49-terms of the trust or Subtitle 7 of this title, a trustee may elect to follow the procedures set Ch. 632 2022 LAWS OF MARYLAND
5050
51-– 2 –
52-forth in this subsection concerning the release of the trustee from liability for the
53-administration of the trust.
51+beneficiary, co–trustee, successor trustee, or any other person having an interest in or 1
52+authority over a trust. 2
5453
55- (2) A trustee seeking a release of the trustee from liability under this
56-subsection shall send to [each] THE interested party FROM WHOM THE TRUSTE E IS
57-SEEKING THE RELEASE , by first–class[,] AND certified mail, return receipt requested, a
58-report that:
54+ (b) A trustee is not liable to a beneficiary for breach of trust if the beneficiary 3
55+consented to the conduct constituting the breach, released the trustee from liability for the 4
56+breach, or ratified the transaction constituting the breach, unless: 5
5957
60- (i) Informs the interested party that the trust is terminating or that
61-the trustee has resigned or has been removed;
58+ (1) The consent, release, or ratification of the beneficiary was induced by 6
59+improper conduct of the trustee; or 7
6260
63- (ii) Provides the interested party:
61+ (2) At the time of the consent, release, or ratification, the beneficiary did 8
62+not know of the rights of the beneficiary or of the material facts relating to the breach. 9
6463
65- 1. An accounting of the trust, such as account statements, for
66-the immediately preceding 5 years;
64+ (c) (1) When a trust terminates in accordance with the terms of the trust or 10
65+Subtitle 4 of this title, or on the removal or resignation of a trustee in accordance with the 11
66+terms of the trust or Subtitle 7 of this title, a trustee may elect to follow the procedures set 12
67+forth in this subsection concerning the release of the trustee from liability for the 13
68+administration of the trust. 14
6769
68- 2. An estimate of any trust property or interests reasonably
69-anticipated but not yet received or disbursed; and
70+ (2) A trustee seeking a release of the trustee from liability under this 15
71+subsection shall send to [each] THE interested party FROM WHOM THE TRUSTE E IS 16
72+SEEKING THE RELEASE , by first–class[,] AND certified mail, return receipt requested, a 17
73+report that: 18
7074
71- 3. The amount of any fees, including trustee fees, remaining
72-to be paid; and
75+ (i) Informs the interested party that the trust is terminating or that 19
76+the trustee has resigned or has been removed; 20
7377
74- (iii) Notifies the interested party that:
78+ (ii) Provides the interested party: 21
7579
76- 1. The interested party may submit WITHIN 120 DAYS
77-AFTER THE TRUSTEE MA ILED THE REPORT :
80+ 1. An accounting of the trust, such as account statements, for 22
81+the immediately preceding 5 years; 23
7882
79- A. A written objection to the trustee regarding the trustee’s
80-administration of the trust [within 120 days after the trustee mailed the report]; OR
83+ 2. An estimate of any trust property or interests reasonably 24
84+anticipated but not yet received or disbursed; and 25
8185
82- B. A WRITTEN STATEMENT TO THE TRUSTEE THAT THE
83-INTERESTED PARTY DOE S NOT OBJECT;
86+ 3. The amount of any fees, including trustee fees, remaining 26
87+to be paid; and 27
8488
85- 2. If the interested party does not submit a written objection
86-to the trustee within 120 days after the trustee mailed the report, the interested party shall
87-be deemed to have released the trustee and consented to and ratified all actions of the
88-trustee; and
89+ (iii) Notifies the interested party that: 28
8990
90- 3. The trustee is unaware of any undisclosed information
91-that could give rise to a claim by an interested party.
91+ 1. The interested party may submit WITHIN 120 DAYS 29
92+AFTER THE TRUSTEE MA ILED THE REPORT : 30
9293
93- (d) [If an interested party does not submit a written objection to the trustee
94-within 120 days after the trustee mailed the report, the] AN interested party TO WHOM A
95-REPORT WAS SENT UNDE R SUBSECTION (C)(2) OF THIS SECTION shall be deemed to
96-have released the trustee and consented to and ratified all actions of the trustee IF, WITHIN LAWRENCE J. HOGAN, JR., Governor Ch. 632
94+ A. A written objection to the trustee regarding the trustee’s 31
95+administration of the trust [within 120 days after the trustee mailed the report]; OR 32
96+ HOUSE BILL 1049 3
9797
98-– 3 –
99-120 DAYS AFTER THE TRUSTEE MA ILED THE REPORT , THE INTERESTED PARTY :
10098
101- (1) DOES NOT SUBMIT A WRI TTEN OBJECTION TO TH E TRUSTEE; OR
99+ B. A WRITTEN STATEMENT TO THE TRUSTEE THAT THE 1
100+INTERESTED PARTY DOE S NOT OBJECT; 2
102101
103- (2) SUBMITS A WRITTEN STA TEMENT TO THE TRUSTEE THAT THE
104-INTERESTED PARTY DOE S NOT OBJECT.
102+ 2. If the interested party does not submit a written objection 3
103+to the trustee within 120 days after the trustee mailed the report, the interested party shall 4
104+be deemed to have released the trustee and consented to and ratified all actions of the 5
105+trustee; and 6
105106
106- (e) (1) [If] SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IF no
107-interested party TO WHOM A REPORT WAS SENT UNDER SUBSECTIO N (C)(2) OF THIS
108-SECTION submits a written objection to the trustee within 120 days after the trustee
109-mailed the report, the trustee shall distribute the trust property to the appropriate
110-successors in interest within a reasonable period of time.
107+ 3. The trustee is unaware of any undisclosed information 7
108+that could give rise to a claim by an interested party. 8
111109
112- (2) IF EACH INTERESTED PARTY TO WHOM A REPORT WAS SENT
113-UNDER SUBSECTION (C)(2) OF THIS SECTION PROVIDES A WRITTEN STATEMENT IN
114-ACCORDANCE WITH SUBSECTION (D)(2) OF THIS SECTION , THE TRUSTEE MAY
115-DISTRIBUTE THE TRUST PROPERTY TO THE APPR OPRIATE SUCCESSORS I N
116-INTEREST WITHIN THE 120–DAY PERIOD AFTER THE MAILING OF THE REPORT .
110+ (d) [If an interested party does not submit a written objection to the trustee 9
111+within 120 days after the trustee mailed the report, the] AN interested party TO WHOM A 10
112+REPORT WAS SENT UNDE R SUBSECTION (C)(2) OF THIS SECTION shall be deemed to 11
113+have released the trustee and consented to and ratified all actions of the trustee IF, WITHIN 12
114+120 DAYS AFTER THE TRUSTEE MA ILED THE REPORT , THE INTERESTED PARTY : 13
117115
118- (f) If an interested party TO WHOM A REPORT WAS SENT UNDER SUBSECTIO N
119-(C)(2) OF THIS SECTION submits a written objection to the trustee within 120 days after
120-the trustee mailed the report, the objection may be:
116+ (1) DOES NOT SUBMIT A WRI TTEN OBJECTION TO TH E TRUSTEE; OR 14
121117
122- (1) Submitted to the court, with notice to all interested parties TO WHOM
123-A REPORT WAS SENT UN DER SUBSECTION (C)(2) OF THIS SECTION , to commence a
124-proceeding for resolution of the objection; or
118+ (2) SUBMITS A WRITTEN STA TEMENT TO THE TRUSTEE THAT THE 15
119+INTERESTED PARTY DOE S NOT OBJECT. 16
125120
126- (2) Resolved by the agreement of all interested parties TO WHOM A
127-REPORT WAS SENT UNDE R SUBSECTION (C)(2) OF THIS SECTION and the trustee, in
128-accordance with applicable laws.
121+ (e) (1) [If] SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IF no 17
122+interested party TO WHOM A REPORT WAS SENT UNDER SUBSECTIO N (C)(2) OF THIS 18
123+SECTION submits a written objection to the trustee within 120 days after the trustee 19
124+mailed the report, the trustee shall distribute the trust property to the appropriate 20
125+successors in interest within a reasonable period of time. 21
129126
130- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect
131-October 1, 2022.
127+ (2) IF EACH INTERESTED PARTY TO WHOM A REPORT WAS SENT 22
128+UNDER SUBSECTION (C)(2) OF THIS SECTION PROVIDES A WRITTEN STATEMENT IN 23
129+ACCORDANCE WITH SUBSECTION (D)(2) OF THIS SECTION , THE TRUSTEE MAY 24
130+DISTRIBUTE THE TRUST PROPERTY TO THE APPR OPRIATE SUCCESSORS I N 25
131+INTEREST WITHIN THE 120–DAY PERIOD AFTER THE MAILING OF THE REPORT. 26
132132
133-Enacted under Article II, § 17(c) of the Maryland Constitution, May 29, 2022.
133+ (f) If an interested party TO WHOM A REPORT WAS SENT UNDER SUBSECTIO N 27
134+(C)(2) OF THIS SECTION submits a written objection to the trustee within 120 days after 28
135+the trustee mailed the report, the objection may be: 29
136+
137+ (1) Submitted to the court, with notice to all interested parties TO WHOM 30
138+A REPORT WAS SENT UN DER SUBSECTION (C)(2) OF THIS SECTION , to commence a 31
139+proceeding for resolution of the objection; or 32
140+
141+ (2) Resolved by the agreement of all interested parties TO WHOM A 33
142+REPORT WAS SENT UNDE R SUBSECTION (C)(2) OF THIS SECTION and the trustee, in 34
143+accordance with applicable laws. 35 4 HOUSE BILL 1049
144+
145+
146+
147+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 1
148+October 1, 2022. 2
149+
150+
151+
152+Approved:
153+________________________________________________________________________________
154+ Governor.
155+________________________________________________________________________________
156+ Speaker of the House of Delegates.
157+________________________________________________________________________________
158+ President of the Senate.