Oklahoma 2024 Regular Session

Oklahoma House Bill HB3962 Compare Versions

Version 1 (Old)

Version 2 (New)

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1		-	An Act
2		-	ENROLLED HOUSE
3		-	BILL NO. 3962 By: Echols and Kane of the
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	27	+
	28	+	STATE OF OKLAHOMA
	29	+
	30	+	2nd Session of the 59th Legislature (2024)
	31	+
	32	+	CONFERENCE COMMITTEE
	33	+	SUBSTITUTE
	34	+	FOR ENGROSSED
	35	+	HOUSE BILL NO. 3962 By: Echols and Kane of the
4	36		House
5	37
6	38		and
7	39
8	40		Pugh of the Senate
9	41
10	42
11	43
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	46	+	CONFERENCE COMMITTEE SUBSTITUTE
12	47
13	48		An Act relating to trusts; creating the Oklahoma
14	49		Trust Reform Act of 2024; providing short title;
15	50		creating the Oklahoma Uniform Directed Trust Act of
16	51		2024; providing short title; defining terms;
17	52		providing for applicability; providing for principal
18	53		place of administration; providing for when common
19	54		law and principals of equity control; providing for
20	55		exclusions; providing the powers of a trust director;
21	56		providing limitations on trus t director; providing
22	57		duties and liabilities of a trust director; providing
23	58		duties and liabilities of directed trustees;
24	59		providing a duty to provide certain information to a
25	60		trust director or trustee; providing that there is no
26	61		duty to monitor, inform, or advise; providing
27	62		application to cotrustee; providing limitation of
28	63		action against a trust dir ector; providing defenses
29	64		for a suit against a trust director; providing
30	65		jurisdiction over a trust director; providing that
31	66		unless the term of a trust provides ot herwise, the
32	67		rules applicable to a trustee shall apply to a trust
33	68		director in certain matters; providing relation to
34	69		electronic signature laws; creating the Oklahoma
35	70		Qualified Dispositions into Trust Act; providing
36	71		short title; defining terms; defining tru st
37	72		instrument; defining qualified person; providing
38	73		requirements to be considered a qualified person;
39	74		providing for persons and entities not to be
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40	101		considered a qualified perso n; providing for the
41	102		appointment, removal, or replacement of cotrustee,
42	103		trust advisor, or trust protector; providing who may
43	104		serve as an investment trust advis or; providing that
44	105		a transferor may not serve as a fiduciary; providing
45	106		for successor qualified p erson; providing for
46		-	disposition to more than one trustee; ~~prov iding~~ that ~~ENR. H. B. NO. 3962 Page 2~~
	107	+	disposition to more than one trustee; providing that
47	108		for dispositions to more than one trustee, a
48	109		qualified disposition may not be treated as other
49	110		than a qualified disposition solely because not all
50	111		of the trustees are qualified perso ns; providing
51	112		powers and rights of a transferor and its effect on a
52	113		qualified disposition; limiting actions of creditors
53	114		to transfers with the intent to defrau d; providing
54	115		requirements for bringing claim s with respect to
55	116		qualified disposition of a transferor's assets;
56	117		providing for disposition by transferor who is a
57	118		trustee; prohibiting certain actions against a
58	119		trustee, advisor, or trust preparer; prohibiting
59	120		certain action against trustee, advisor, or preparer
60	121		of trust; providing court jurisdiction; providing for
61	122		the collection of attorney fees and costs in certain
62	123		circumstances; providing for when multiple qualified
63	124		dispositions in same trust instrument; providing
64	125		certain exceptions to application of this act under
65	126		certain events and circumstances; providing for
66	127		avoidance of a qualified disposition; providing for
67	128		discretionary interes t; providing that the rules
68	129		against perpetuities shall not apply to trusts;
69	130		providing intent to allow trust to have perpetual
70	131		durations; providing for nonjudicial settlement
71	132		agreements for trusts; p roviding when nonjudicial
72	133		settlement agreements are valid; clarifying what
73	134		matters may be solved by a nonjudicial settlement
74	135		agreement; providing for co urt approval of
75	136		nonjudicial settlement agreements; amending 60 O.S.
76	137		2021, Sections 175.24, 175.4 7, and 175.57, which
77	138		relate to powers of trustee, power of alienat ion, and
78	139		breach of trust; authorizing payment of certain costs
79	140		and fees by trustee; providing for creation of
80	141		attorney-client relationship under certain
81	142		circumstances; providing exception; providing for
82	143		confidentiality of certain communications;
83	144		authorizing perpetual duration of certain trusts;
84	145		defining term; establishing requirements for approval
85	146		of certain accountings; providing limitation on
86	147		certain action; updating statutory language; making
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87	174		language gender neutral; providing for
88	175		noncodification; provid ing for codification; and
89	176		providing an effective date .
90	177
91		-	~~ENR. H. B. NO. 3962 Page 3~~
92		-
93		-	~~SUBJECT: Trusts~~
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94	181
95	182		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
96		-
97	183		SECTION 1. NEW LAW A new section of law not to be
98	184		codified in the Oklahoma Statutes reads as follows:
99		-
100	185		This act shall be known and may be cited as the "Oklahoma Trust
101	186		Reform Act of 2024".
102		-
103	187		SECTION 2. NEW LAW A new section of law to be codified
104	188		in the Oklahoma Statutes as Section 1201 of Ti tle 60, unless there
105	189		is created a duplication in nu mbering, reads as follows:
106		-
107	190		Sections 2 through 1 8 of this act shall be known and may be
108	191		cited as the "Oklahoma Uniform Directed Trust Act of 2024 ".
109		-
110	192		SECTION 3. NEW LAW A new section of law to be codified
111	193		in the Oklahoma Statutes as Section 1202 of Title 60, unless there
112	194		is created a duplication in numbering, reads as follow s:
113		-
114	195		As used in the Oklahoma Uniform Directed Trust A ct of 2024:
115		-
116	196		1. "Breach of trust" means a violation by a trust director or
117	197		trustee of a duty imposed on that director or trustee by the terms
118	198		of the trust, this act, or laws of this state other than this act
119	199		pertaining to trusts;
120		-
121	200		2. "Directed trust" means a trust for which the terms of the
122	201		trust grant a power of direction;
123	202
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124	228		3. "Directed trustee" means a trustee that is subject to a
125	229		trust director's power of direction;
126		-
127	230		4. "Person" means an individual, estate, business or nonprofit
128	231		entity, public corpo ration, government or governmental subdivision,
129	232		agency, or instrumentality, or other legal entity;
130		-
131	233		5. "Power of direction" means a power over a trust granted to a
132	234		person by the terms of the trust to the extent the power is
133	235		exercisable while the person is not serving as a trustee. The term
134	236		includes a power over the investment, management, or distribution of
135		-	trust property or other matters of trust administration. The term ~~ENR. H. B. NO. 3962 Page 4~~
	237	+	trust property or other matters of trust administration. The term
136	238		excludes the powers describe d in subsection B of Section 6 of this
137	239		act;
138		-
139	240		6. "Settlor" means a person, including a testator, that creates
140	241		or contributes property to a trust. If more than one person creates
141	242		or contributes property to a trust, each person is a settlor of the
142	243		portion of the trust property attributable to that person 's
143	244		contribution except to the extent another person has the power to
144	245		revoke or withdraw that portion;
145		-
146	246		7. "State" means a state of the United States, the District of
147	247		Columbia, Puerto Rico, the United States Virgin Islands, or any
148	248		other territory or pos session subject to the jurisdiction of the
149	249		United States;
150		-
151	250		8. "Terms of a trust" means:
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152	276
153	277		a. except as otherwise provided in subparagraph b of this
154	278		paragraph, the manifestation of the settlor 's intent
155	279		regarding a trust's provisions as:
156		-
157	280		(1) expressed in the trust instrument, or
158		-
159	281		(2) established by other evidence that would be
160	282		admissible in a judicial proceeding, or
161		-
162	283		b. the trust's provisions as established, determined, or
163	284		amended by:
164		-
165	285		(1) a trustee or trust director in accordance with
166	286		applicable law, or
167		-
168	287		(2) a court order;
169		-
170	288		9. "Trust director" means a person that is granted a power of
171	289		direction by the terms of a trust to the extent the power is
172	290		exercisable while the person is not serving as a trustee. T he
173	291		person is a trust director whether or not the t erms of the trust
174	292		refer to the person as a trust director and whether or not the
175	293		person is a beneficiary or settlor of the trust; and
176		-
177	294		10. "Trustee" means an original, additional, and successor
178	295		trustee, and a cotrustee.
179		-	ENR. H. B. NO. 3962 Page 5
180	296		SECTION 4. NEW LAW A new section of law to be codified
181	297		in the Oklahoma Statutes as Section 1203 of Title 60, unless there
182	298		is created a duplication in numbering, reads as follows:
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183	324
184	325		A. This act applies to a trust, whenever created, that has its
185	326		principal place of a dministration in this state and is subject to
186	327		the following rules:
187		-
188	328		1. If the trust was created before the effective date of this
189	329		act, this act applies only to a decision or action occurring on or
190	330		after the effective date of this act; and
191		-
192	331		2. If the principal place of administration of the trust is
193	332		changed to this state on or after the effective date of this act,
194	333		this act applies only to a decision or action occurring on or after
195	334		the date of the change.
196		-
197	335		B. Without precluding other means to establish a sufficient
198	336		connection with the designated jurisdiction in a directed trust, the
199	337		terms of the trust which designate the principal place of
200	338		administration of the trust are valid and controlling if:
201		-
202	339		1. A trustee's principal place of business is located in or a
203	340		trustee is a resident of the designated jurisdiction;
204		-
205	341		2. A trust director 's principal place of business is located in
206	342		or a trust director is a resident of the designated jurisdiction; or
207		-
208	343		3. All or part of the administration occurs in the des ignated
209	344		jurisdiction.
210		-
211	345		SECTION 5. NEW LAW A new section of law to be codified
212	346		in the Oklahoma Statutes as Section 1204 of Title 60, unless there
213	347		is created a duplication in number ing, reads as follows:
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214	373
215	374		The common law and principle s of equity supplement this act,
216	375		except to the extent modified by this act or by other laws of this
217	376		state other than this act.
218		-
219	377		SECTION 6. NEW LAW A new section of law to be codi fied
220	378		in the Oklahoma Statutes as Section 1205 of Ti tle 60, unless there
221	379		is created a duplication in numbering, reads as follows:
222		-
223	380		A. In this section, "power of appointment " means a power that
224		-	enables a person acting in a nonfiduciary capacity to designate a ~~ENR. H. B. NO. 3962 Page 6~~
	381	+	enables a person acting in a nonfiduciary capacity to designate a
225	382		recipient of an ownership interest in or another power of
226	383		appointment over trust property.
227		-
228	384		B. This act does not apply to a:
229		-
230	385		1. Power of appointment;
231		-
232	386		2. Power to appoint or remove a trustee or trust director;
233		-
234	387		3. Power of a settlor over a trust to the extent the settlor
235	388		has a power to revoke the trust;
236		-
237	389		4. Power of a beneficiary over a trust to the extent the
238	390		exercise or nonexercise of the power affects the beneficial interest
239	391		of:
240		-
241	392		a. the beneficiary, or
242		-
243	393		b. another beneficiary represented by t he beneficiary
244	394		with respect to the exercise or none xercise of the
245	395		power; or
246		-
247	396		5. Power over a trust, if:
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248	422
249	423		a. the terms of the trust provide that the power is held
250	424		in a nonfiduciary capacity, and
251		-
252	425		b. the power must be held in a nonfiduciary capacity to
253	426		achieve the settlor's tax objectives under the United
254	427		States Internal Revenue Code of 1986, a s amended, and
255	428		regulations issued thereunder, as amended.
256		-
257	429		C. Unless the terms of a trust provide otherwise, a power
258	430		granted to a person to designate a recipient of an ownership
259	431		interest in, or power of appointment o ver trust property which is
260	432		exercisable while the person is not serving as a trustee is a power
261	433		of appointment and not a power of direction.
262		-
263	434		SECTION 7. NEW LAW A new section of law to be codified
264	435		in the Oklahoma Statutes as Sec tion 1206 of Title 60, unless there
265	436		is created a duplication in numbering, reads as follows:
266		-
267	437		A. Subject to Section 8 of this act, the terms of a trust may
268	438		grant a power of direction to a trust director.
269		-	ENR. H. B. NO. 3962 Page 7
270	439		B. Unless the terms of a trust provide otherwise:
271		-
272	440		1. A trust director may exercise any further power appropriate
273	441		to the exercise or nonexercise of a power of direction granted to
274	442		the director under subsection A of this section; and
275		-
276	443		2. Trust directors w ith joint powers must act by majority
277	444		decision.
278	445
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279	471		SECTION 8. NEW LAW A new section of law to be codified
280	472		in the Oklahoma Statutes as Section 1207 of Title 60, unless there
281	473		is created a duplication in numbering, reads as follows:
282		-
283	474		A trust director is subject to the same rules as a tr ustee in a
284	475		like position and under similar circumstances in the exercise or
285	476		nonexercise of a power of direction or further power under paragraph
286	477		1 of subsection B of Section 7 of this act regarding:
287		-
288	478		1. A payback provision in the terms of a trust necessar y to
289	479		comply with the reimbursement requirements of Medicaid law in
290	480		Section 1917 of the Social Security Act, 42 U.S.C., Section
291	481		1396p(d)(4)(A), as amended, and regulations issued thereunder, as
292	482		amended; and
293		-
294	483		2. A charitable interest in the trust, includ ing providing
295	484		notice regarding the interest to the Attorney General.
296		-
297	485		SECTION 9. NEW LAW A new section of law to be codified
298	486		in the Oklahoma Statutes as Section 1208 of Title 60 , unless there
299	487		is created a duplication in numbering , reads as follows:
300		-
301	488		A. Subject to subsection B of this section, with respect to a
302	489		power of direction or further power under paragraph 1 of subsection
303	490		B of Section 7 of this act:
304		-
305	491		1. A trust director has the same fiduciary duty and liability
306	492		in the exercise or nonexercise of the power:
307		-
308	493		a. if the power is held individually, as a sole trustee
309	494		in a like position and under similar circumstances, or
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310	520
311	521		b. if the power is held jointly with a trustee or another
312	522		trust director, as a cotrustee in a like position and
313	523		under similar circumstances; and
314		-	ENR. H. B. NO. 3962 Page 8
315	524		2. The terms of the trust may vary the director 's duty or
316	525		liability to the same extent the terms of the trust could vary the
317	526		duty or liability of a trustee in a like position and under similar
318	527		circumstances.
319		-
320	528		B. Unless the terms of a trust provide otherwise, if a trust
321	529		director is licensed, certified, or otherwise authorized or
322	530		permitted by law other than this act to provide health care in the
323	531		ordinary course of the director's business or practice of a
324	532		profession, to the extent the director acts in that capacity, the
325	533		director has no duty or liability under this act.
326		-
327	534		C. The terms of a trust may impose a duty or liability on a
328	535		trust director in addition to the duties and liabilities under this
329	536		section.
330		-
331	537		SECTION 10. NEW LAW A new section of law to be codified
332	538		in the Oklahoma Statutes as Section 1209 of Title 60, unless there
333	539		is created a duplication in numbering, reads as follows:
334		-
335	540		A. Subject to subsection B of this section, a directed trustee
336	541		shall take reasonable action to comply with a trust director's
337	542		exercise or nonexercise of a power of direction or further power
338	543		under paragraph 1 of subsection B of Section 7 of this act, and the
339	544		trustee is not liable for the action.
340	545
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341	571		B. A directed trustee must not comply with a trust director 's
342	572		exercise or nonexercise of a power of direction or further power
343	573		under paragraph 1 of subsection B of Section 7 of this act to the
344	574		extent that by complying, th e trustee would engage in willful
345	575		misconduct.
346		-
347	576		C. An exercise of a power of direction under which a trust
348	577		director may release a trustee or another trust director from
349	578		liability for breach of trust is not effective if:
350		-
351	579		1. The breach involved the trust ee's or other director's
352	580		willful misconduct;
353		-
354	581		2. The release was induced by improper conduct of the trustee
355	582		or other director in procuring the release; or
356		-
357	583		3. At the time of the release, the trust director did not know
358	584		the material facts relating to the breach.
359		-	ENR. H. B. NO. 3962 Page 9
360	585		D. A directed trustee that has reasonable d oubt about its duty
361	586		under this section may petition the district court for instructions.
362		-
363	587		E. The terms of a trust may impose a duty or liability on a
364	588		directed trustee in addition to the duties and liabilities under
365	589		this section.
366		-
367	590		SECTION 11. NEW LAW A new section of law to be codified
368	591		in the Oklahoma Statutes as Section 1210 of Title 60, unless there
369	592		is created a duplication in numbering, reads as follows:
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370	618
371	619		A. Subject to Section 1 2 of this act, a trustee shall provide
372	620		information to a trust director to the extent the information is
373	621		reasonably related both to:
374		-
375	622		1. The powers or duties of the trustee; and
376		-
377	623		2. The powers or duties of the director.
378		-
379	624		B. Subject to Section 12 of thi s act, a trust director shall
380	625		provide information to a trustee or another trust director to the
381	626		extent the information is reasonably related both to:
382		-
383	627		1. The powers or duties of the director; and
384		-
385	628		2. The powers or duties of the trustee or other director .
386		-
387	629		C. A trustee that acts in reliance on informatio n provided by a
388	630		trust director is not liable for a breach of trust to the extent the
389	631		breach resulted from the reliance, unless by so acting, the trustee
390	632		engages in willful misconduct.
391		-
392	633		D. A trust director that acts in reliance on information
393	634		provided by a trustee or another trust director is not liable for a
394	635		breach of trust to the extent the breach resulted from the reliance,
395	636		unless by so acting, the trust director engages in willful
396	637		misconduct.
397		-
398	638		SECTION 12. NEW LAW A new secti on of law to be codified
399	639		in the Oklahoma Statutes as Section 1211 of Title 60, unless there
400	640		is created a duplication in numbering, reads as follows:
401		-
402	641		A. Unless the terms of a trust provide otherwise:
403		-
404		-	1. A trustee does not have a duty to: ENR. H. B. NO. 3962 Page 10
	642	+	1. A trustee does not have a duty to:
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405	668
406	669		a. monitor a trust director, or
407		-
408	670		b. inform or give advice to a settlor, beneficiary,
409	671		trustee, or trust director concerning an instance in
410	672		which the trustee might have acted differently than
411	673		the director; and
412		-
413	674		2. By taking an action described in paragraph 1 of this
414	675		subsection, a trustee does not assume the duty excluded by paragrap h
415	676		1 of this subsection.
416		-
417	677		B. Unless the terms of a trust provide otherwise:
418		-
419	678		1. A trust director does not have a duty to:
420		-
421	679		a. monitor a trustee or another trust director, or
422		-
423	680		b. inform or give advice to a settlor, beneficiary,
424	681		trustee, or another trust director concerning an
425	682		instance in which the director might have acted
426	683		differently than a trustee or another trust director;
427	684		and
428		-
429	685		2. By taking an action described in paragraph 1 of this
430	686		subsection, a trust director does not assume the duty excluded by
431	687		paragraph 1 of this subsection.
432		-
433	688		SECTION 13. NEW LAW A new section of law to be codified
434	689		in the Oklahoma Statutes as Se ction 1212 of Title 60, unless there
435	690		is created a duplication in numbering, reads as follows:
436		-
437	691		The terms of a trust may relieve a cotrustee from duty and
438	692		liability with respect to another cotrustee's exercise or
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439	719		nonexercise of a power of the other cotruste e to the same extent
440	720		that in a directed trust a dir ected trustee is relieved from duty
441	721		and liability with respect to a trust director's power of direction
442	722		under Sections 10 through 12 of this act.
443		-
444	723		SECTION 14. NEW LAW A new secti on of law to be codified
445	724		in the Oklahoma Statutes as Section 1213 of Title 60, unless there
446	725		is created a duplication in numbering, reads as follows:
447		-
448	726		A. An action against a trust director for breach of trust must
449		-	be commenced within the same limitation period for an action for ~~ENR. H. B. NO. 3962 Page 11~~
	727	+	be commenced within the same limitation period for an action for
450	728		breach of trust against a trustee in a like position and under
451	729		similar circumstances.
452		-
453	730		B. A report or accounting has the same effect on the limitation
454	731		period for an action against a trust director for breach of trust
455	732		that the report or accounting would have in an action for breach of
456	733		trust against a trustee in a like position and under similar
457	734		circumstances.
458		-
459	735		SECTION 15. NEW LAW A new section of law to be codified
460	736		in the Oklahoma Statutes as Section 1214 o f Title 60, unless there
461	737		is created a duplication in numbering, reads as follows:
462		-
463	738		In an action against a trust director for breach of trust, the
464	739		director may assert the same defenses a trustee in a like position
465	740		and under similar circumstances could asser t in an action for breach
466	741		of trust against the trus tee.
467	742
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468	768		SECTION 16. NEW LAW A new section of law to be codified
469	769		in the Oklahoma Statutes as Section 1215 of Title 60, unless there
470	770		is created a duplication in numbering, reads as fo llows:
471		-
472	771		A. By accepting appointment as a trust direc tor of a trust
473	772		subject to this act, the director submits to personal jurisdiction
474	773		of the courts of this state regarding any matter related to a power
475	774		or duty of the director.
476		-
477	775		B. This section does not preclude other methods of obtaining
478	776		jurisdiction over a trust director.
479		-
480	777		SECTION 17. NEW LAW A new section of law to be codified
481	778		in the Oklahoma Statutes as Section 1216 of Title 60, unless there
482	779		is created a duplication in number ing, reads as follows:
483		-
484	780		Unless the terms of a trust p rovide otherwise, the rules
485	781		applicable to a trustee apply to a trust director regarding the
486	782		following matters:
487		-
488	783		1. Acceptance;
489		-
490	784		2. Giving of bond to secure performance;
491		-
492	785		3. Reasonable compensation;
493		-
494		-	4. Resignation; ENR. H. B. NO. 3962 Page 12
495		-
	786	+	4. Resignation;
496	787		5. Removal; and
497		-
498	788		6. Vacancy and appointment of a successor.
499		-
500	789		SECTION 18. NEW LAW A new section of law to be codified
501	790		in the Oklahoma Statutes as Section 1217 of Title 60, unless there
502	791		is created a duplication in numbering, reads as follows:
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503	817
504	818		This act modifies, lim its, or supersedes the Electronic
505	819		Signatures in Global and National Commerce Act, 15 U.S.C., Section
506	820		7001 et seq., but does not modify, limit, or supersede Section
507	821		101(c) of that act, 15 U.S.C., Sectio n 7001(c), or authorize
508	822		electronic delivery of any o f the notices described in Section
509	823		103(b) of that act, 15 U.S.C., Section 7003(b).
510		-
511	824		SECTION 19. NEW LAW A new section of law to be codified
512	825		in the Oklahoma Statutes as Section 13 01 of Title 60, unless there
513	826		is created a duplicatio n in numbering, reads as follows:
514		-
515	827		Sections 19 through 37 of this act shall be known and may be
516	828		cited as the "Oklahoma Qualified Dispositions into Trust Act ".
517		-
518	829		SECTION 20. NEW LAW A new section of law to be codified
519	830		in the Oklahoma Statutes as Section 1302 of Title 60, unless there
520	831		is created a duplication in numbering, reads as follows:
521		-
522	832		A. As used in the Oklahoma Qualified Dispositions into Trust
523	833		Act:
524		-
525	834		1. "Claim" means a right to payment, whether or not the right
526	835		is reduced to judgment liquidated, unliquidated, fixed, contingent,
527	836		matured, unmatured, disputed, undisputed, legal, equitable, secured,
528	837		or unsecured;
529		-
530	838		2. "Creditor" means, with respect to a transferor, a person who
531	839		has a claim;
532		-
533	840		3. "Debt" means liability on a claim;
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534	866
535	867		4. "Disposition" means a transfer, conveyance, or assignment of
536	868		property, including a change in the legal ownership of property
537	869		occurring upon the substitution of one trustee for another or the
538	870		addition of one or more new trustees, or the exercise of a power so
539		-	as to cause a transfer of property to a trustee or trustees. The ~~ENR. H. B. NO. 3962 Page 13~~
	871	+	as to cause a transfer of property to a trustee or trustees. The
540	872		term does not include the release or relinquishment of an interest
541	873		in property that theretofore was the subject of a qualified
542	874		disposition;
543		-
544	875		5. "Property" means real property, personal prop erty, and
545	876		interests in real or personal property;
546		-
547	877		6. "Qualified disposition " means a disposition by or from a
548	878		transferor to a qualified person or qualified persons, without
549	879		consideration or for less than fair market value, by means of a
550	880		trust instrument;
551		-
552	881		7. "Spouse" and "former spouse" mean only persons to whom the
553	882		transferor was married at, or before, the time the qualified
554	883		disposition was made; and
555		-
556	884		8. "Transferor" means any person as an owner of prope rty or as
557	885		a holder of a power of appointment which a uthorizes the holder to
558	886		appoint in favor of the holder, the holder 's creditors, the holder 's
559	887		estate, or the creditors of the holder 's estate or as a trustee,
560	888		directly or indirectly, who makes a disposition or causes a
561	889		disposition to be made.
562	890
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563	916		B. The terms transferor and beneficiary may be any individual,
564	917		corporation, partnership, limited liability company, association,
565	918		joint stock company, business trust, trust, unincorporated
566	919		organization, or two or more persons having a joint or common
567	920		interest.
568		-
569	921		SECTION 21. NEW LAW A new section of law to be codified
570	922		in the Oklahoma Statutes as Section 1303 of Title 60, unless there
571	923		is created a duplication in numbering, reads as follows:
572		-
573	924		A. For the purposes of the Oklahoma Qualified Dispositions into
574	925		Trust Act, a trust instrument is an instrument appointing a
575	926		qualified person or qualified persons for the property that is the
576	927		subject of a disposition, which instrument:
577		-
578	928		1. Expressly incorporates t he law of this state to govern the
579	929		validity, construction, and administration of the trust;
580		-
581	930		2. Is irrevocable, but a trust instrument may not be deemed
582	931		revocable on account of its inclusion of one or more of the
583	932		following:
584		-	ENR. H. B. NO. 3962 Page 14
585	933		a. a transferor's power to veto a distribution from the
586	934		trust,
587		-
588	935		b. an inter vivos power of appointment, other than an
589	936		inter vivos power exercisable solely by the transferor
590	937		in favor of the transferor, the transferor 's
591	938		creditors, the transferor 's estate, or the creditors
592	939		of the transferor's estate,
593	940
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594	966		c. a testamentary power of appointment,
595		-
596	967		d. the transferor's potential or actual receipt of
597	968		income, including rights to such income retained in
598	969		the trust instrument,
599		-
600	970		e. the transferor's potential or actual receipt of income
601	971		or principal from a cha ritable remainder unitrust or
602	972		charitable remainder a nnuity trust as such terms are
603	973		defined in Section 664 of the Internal Revenue Code of
604	974		1986, 26 U.S.C., Section 664, as of January 1, 2009 ,
605		-
606	975		f. the transferor's receipt each year of a percentage of
607	976		the value as determined from time to time pursuant to
608	977		the trust instrument, but not exceeding the amount
609	978		that may be defined as income under Section 643(b) of
610	979		the Internal Revenue Code of 1986, 26 U.S.C. , Section
611	980		643(b), as of January 1, 2009,
612		-
613	981		g. the transferor's receipt each year of a percentage of
614	982		the value as determined from time to time pursuant to
615	983		the trust instrument, but not exceeding the amount
616	984		that may be defined as income under Section 664 of the
617	985		Internal Revenue Code of 1986, 26 U.S.C., Section
618	986		643(b), as of January 1, 2009,
619		-
620	987		h. the transferor's potential or actual receipt or use of
621	988		principal if the potential or actual receipt or use of
622	989		principal would be the result of a qualified person,
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623	1016		including a qualified person acting at the direction
624	1017		of a trust advisor described in this act, acting
625	1018		either in the qualified person's sole discretion or
626	1019		pursuant to an ascertainable standard contained in the
627	1020		trust instrument,
628		-	ENR. H. B. NO. 3962 Page 15
629	1021		i. the transferor's right to remove a trustee, protector,
630	1022		or trust advisor and to appoint a new t rustee,
631	1023		protector, or trust advisor, other than a tr ustee who
632	1024		is a related or subordinate party with respect to the
633	1025		transferor within the meaning of Section 672(c) of the
634	1026		Internal Revenue Code of 1986, 26 U.S.C. , Section
635	1027		672(c), as of January 1, 2009,
636		-
637	1028		j. the transferor's potential or actual use of real
638	1029		property held under a qualified personal residence
639	1030		trust within the meaning of such term as described in
640	1031		the regulations promulgated under Section 2702(c) of
641	1032		the Internal Revenue Code of 1986, 26 U.S.C. , Section
642	1033		2702(c), as of January 1, 2009,
643		-
644	1034		k. a pour-back provision that pours back to the
645	1035		transferor's will or revocable trust all or part of
646	1036		the trust assets,
647		-
648	1037		l. the transferor's potential or actual receipt of income
649	1038		or principal to pay, in whole or in part, in come taxes
650	1039		due on income of the trust if the potenti al or actual
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	1065	+
651	1066		receipt of income or principal is pursuant to a
652	1067		provision in the trust instrument that expressly
653	1068		provides for the payment of the taxes and if the
654	1069		potential or actual receipt of income or prin cipal
655	1070		would be the result of a qualified person 's acting in
656	1071		the qualified person 's discretion or pursuant to a
657	1072		mandatory direction in the trust instrument or acting
658	1073		at the direction of a trust advisor described in
659	1074		Section 24 of this act,
660		-
661	1075		m. the ability, whether pursuant to discretion,
662	1076		direction, or the gran tor's exercise of a testamentary
663	1077		power of appointment, of a qualified person to pay,
664	1078		after the death of the transferor, all or any part of
665	1079		the debts of the transferor outstanding at the time of
666	1080		the transferor's death, the expenses of administering
667	1081		the transferor's estate, or any estate or inheritance
668	1082		tax imposed on or with respect to the transferor 's
669	1083		estate,
670		-
671	1084		n. a transferor's service as a noncontrolling member of a
672	1085		distribution committee that functions as a
673		-	distribution trust advisor, which is a fiduciary g iven ~~ENR. H. B. NO. 3962 Page 16~~
	1086	+	distribution trust advisor, which is a fiduciary g iven
674	1087		authority by the instrument to exercise all or any
675	1088		portions of the powers and discretions over any
676	1089		discretionary distributions of income or principal, or
	1090	+
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677	1115
678	1116		o. a transferor's enjoyment of a power to rea cquire the
679	1117		trust corpus by substituting other proper ty of an
680	1118		equivalent value within the meaning of Section
681	1119		675(4)(C) of the Internal Revenue Code of 1986, 26
682	1120		U.S.C., Section 675(4)(C), as of January 1, 2021, and
683		-
684	1121		3. Provides that the interest of the trans feror or other
685	1122		beneficiary in the trust property or the income from the trust
686	1123		property may not be transferred, assigned, pledged, or mortgaged,
687	1124		whether voluntarily or involuntarily, before the qualified person
688	1125		distributes the property or income from the pr operty to the
689	1126		beneficiary, and such provision of the trust instrument constitutes
690	1127		a restriction on the transfer of the transferor 's beneficial
691	1128		interest in the trust that is enforceable under applicable
692	1129		nonbankruptcy law within the meaning of Section 541(c) (2) of the
693	1130		Bankruptcy Code, 11 U.S.C., Section 541(c )(2), as of January 1,
694	1131		2009.
695		-
696	1132		B. A disposition by a trustee that is not a qualified person to
697	1133		a trustee that is a qualified person may not be treated as other
698	1134		than a qualified disposition solely because t he trust instrument
699	1135		fails to meet the requirements o f paragraph 1 of subsection A of
700	1136		this section.
701		-
702	1137		SECTION 22. NEW LAW A new section of law to be codified
703	1138		in the Oklahoma Statutes as Section 1304 of Title 60, unless there
704	1139		is created a duplication in numbering, reads as follows:
705	1140
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706	1166		A. For the purposes of the Oklahoma Qualified Dispositions into
707	1167		Trust Act, a qualified person is:
708		-
709	1168		1. An individual who, except for brief intervals, military
710	1169		service, attendance at an educational or training institution, or
711	1170		for absences for good cause shown, resides in this state, whose true
712	1171		and permanent home is in this state, who does not have a present
713	1172		intention of moving from this state, and who has the intention of
714	1173		returning to this state when away;
715		-
716	1174		2. A trust company that is organized under state law or under
717	1175		federal law and that has its principal place of business in this
718		-	state; or ENR. H. B. NO. 3962 Page 17
719		-
	1176	+	state; or
720	1177		3. A bank or savings association that possesses and exercises
721	1178		trust powers, has its principal place of business in this s tate, and
722	1179		the deposits of which are insured by the F ederal Deposit Insurance
723	1180		Corporation.
724		-
725	1181		B. A qualified person must meet the requirements as provided in
726	1182		Section 23 of this act.
727		-
728	1183		SECTION 23. NEW LAW A new section of law to be codif ied
729	1184		in the Oklahoma Statutes as Section 1305 of Titl e 60, unless there
730	1185		is created a duplication in numbering, reads as follows:
731		-
732	1186		A. Except as expressly provided by the terms of a governing
733	1187		instrument or by a court order, a general law or a state
734	1188		jurisdiction provision stating that the laws of this state gov ern is
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735	1215		valid, effective, and conclusive for the trust if all of the
736	1216		following are true:
737		-
738	1217		1. Some or all of the trust assets are deposited in this state
739	1218		or physical evidence of such assets is held in this state and the
740	1219		trust is being administered by a quali fied person. "Deposited in
741	1220		this state" includes being held in a checking account, time deposit,
742	1221		certificate of deposit, brokerage account, trust company fiduciary
743	1222		account, or other similar account or dep osit that is located in this
744	1223		state, including Oklaho ma investments;
745		-
746	1224		2. A trustee is a qualified person who is designated as a
747	1225		trustee under the governing instrument or a successor trusteeship,
748	1226		or designated by a court having jurisdiction over the trust; a nd
749		-
750	1227		3. The administration, including physically main taining trust
751	1228		records in this state, and preparing or arranging for the
752	1229		preparation of, on an exclusive basis or a nonexclusive basis, an
753	1230		income tax return that must be filed by the trust, occurs wholly o r
754	1231		partly in this state.
755		-
756	1232		B. The courts of this state have jurisdiction over a trust
757	1233		created in a foreign jurisdiction if the administration of the trust
758	1234		meets the criteria of paragraphs 1 through 3 of subsection A of this
759	1235		section.
760		-
761	1236		C. Nothing in this secti on may be construed to be the exclusive
762	1237		means of providing a valid effective and conclusive state
763		-	jurisdiction provision. ENR. H. B. NO. 3962 Page 18
	1238	+	jurisdiction provision.
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764	1264
765	1265		SECTION 24. NEW LAW A new section of law to be codified
766	1266		in the Oklahoma Statutes as Section 1306 of Title 60, unless there
767	1267		is created a duplication in numbering, reads as follows:
768		-
769	1268		Neither the transferor nor any other natural person who is a
770	1269		nonresident of this state nor an entity that is not authorized by
771	1270		the laws of this state to act as a trustee or whose activi ties are
772	1271		not subject to supervision as provided in S ection 22 of this act may
773	1272		be considered a qualified person. However, nothing in this act
774	1273		precludes a transferor from appointing, removing, or replacing one
775	1274		or more cotrustees, trust advisors, or trust pr otectors, regardless
776	1275		of whether or not such trust ad visor or trust protector is a
777	1276		fiduciary.
778		-
779	1277		SECTION 25. NEW LAW A new section of law to be codified
780	1278		in the Oklahoma Statutes as Section 1307 of Title 60, unless there
781	1279		is created a duplication in numbering, reads as follows:
782		-
783	1280		Any person may serve as an investment trust advisor,
784	1281		notwithstanding that the person is the transferor of the qualified
785	1282		disposition, but a transferor may not otherwise serve as a fiduciary
786	1283		under a trust instrument except as stated in paragraph 2 of
787	1284		subsection A of Section 21 of this act. While serving as an
788	1285		investment trust advisor of the trust, the person may have all
789	1286		powers authorized by statute or by the trust instrument, including
790	1287		the power to vote by proxy any stock owned by the trust.
791	1288
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792	1314		SECTION 26. NEW LAW A new section of law to be codified
793	1315		in the Oklahoma Statutes as Section 1308 of Title 60, unless there
794	1316		is created a duplication in numbering, reads as follows:
795		-
796	1317		If a qualified person of a trust ceases to meet the requirements
797	1318		of Section 22 of this act and there remains no trustee that meets
798	1319		such requirements, such qualified person shall be deemed to have
799	1320		resigned as of the time of such cessation, and thereupon the
800	1321		successor qualified per son provided for in the trust instrument
801	1322		shall become a qualified person of the trust, or in the absence of
802	1323		any successor qualified person provided for in the trust instrument,
803	1324		the circuit court shall, upon application of any interested party,
804	1325		appoint a successor qualified person.
805		-
806	1326		SECTION 27. NEW LAW A new section of law to be codified
807	1327		in the Oklahoma Statutes as Section 1309 of Title 60, unless there
808		-	is created a duplication in numbering, reads as follows: ENR. H. B. NO. 3962 Page 19
809		-
	1328	+	is created a duplication in numbering, reads as follows:
810	1329		In the case of a disposit ion to more than one trustee, a
811	1330		disposition that is otherwise a qualified disposition may not be
812	1331		treated as other than a qualified disposition solely because not all
813	1332		of the trustees are qualified persons.
814		-
815	1333		SECTION 28. NEW LAW A new section of law to be codified
816	1334		in the Oklahoma Statut es as Section 1310 of Title 60, unless there
817	1335		is created a duplication in numbering, reads as follows:
818		-
819	1336		A qualified disposition is subject to Sections 29 through 34 of
820	1337		this act, notwithstanding a transferor 's retention of any or all of
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821	1364		the powers and rights described in paragraph 2 of subsection A of
822	1365		Section 21 of this act and the transferor 's service as a trust
823	1366		advisor pursuant to Section 25 of this act. The transferor has only
824	1367		such powers and rights as ar e conferred by the trust instrument.
825	1368		Except as permitted by Sections 21 and 25 of this act, a transferor
826	1369		has no rights or authority with respect to the property that is the
827	1370		subject of a qualified disposition or the income therefrom, and any
828	1371		agreement or understanding purporting to grant or permit the
829	1372		retention of any greater rights or authority is void.
830		-
831	1373		SECTION 29. NEW LAW A new section of law to be codified
832	1374		in the Oklahoma Statutes as Section 1311 of Title 60, unless there
833	1375		is created a duplication in numbering, reads as follows:
834		-
835	1376		Notwithstanding any other provision of law, except as set forth
836	1377		in Section 30 of this act, no action of any kind, including an
837	1378		action to enforce a judgment entered by a court or other body having
838	1379		adjudicative authority, may be brought at law or in equity for an
839	1380		attachment or other provisional remedy against property that is the
840	1381		subject of a qualified disposition or for avoidance of a qualified
841	1382		disposition unless the settlor 's transfer of property was made wi th
842	1383		the intent to defraud that specific creditor. Th is protection,
843	1384		however, only applies to qualified d ispositions up to, but not
844	1385		exceeding, Ten Million Dollars ($10,000,000.00) .
845	1386
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846	1412		SECTION 30. NEW LAW A new section of law to be codif ied
847	1413		in the Oklahoma Statutes as Section 1312 of Titl e 60, unless there
848	1414		is created a duplication in numbering, reads as follows:
849		-
850	1415		A. A cause of action or claim for relief with respect to a
851	1416		qualified disposition of a transferor's assets under Section 29 of
852		-	this act is extinguished unless the action under Sect ion 29 of this ~~ENR. H. B. NO. 3962 Page 20~~
	1417	+	this act is extinguished unless the action under Sect ion 29 of this
853	1418		act may only be brought by a creditor of the transferor who meets
854	1419		one of the following requirements:
855		-
856	1420		1. Is a creditor of the settlor before the settlor 's assets are
857	1421		transferred to the trus t; or
858		-
859	1422		2. Becomes a creditor subsequent to the tran sfer into trust,
860	1423		and the asset was listed on a financial statement provided to a bank
861	1424		or financial institution by or on behalf of the transferor for the
862	1425		purpose of obtaining credit as a borrower, guarantor, surety,
863	1426		pledgor, or otherwise.
864		-
865	1427		B. Any action under Section 29 of this act may be filed at any
866		-	time, but in any event not later than five (5) years after the
867		-	creditor has obtained a final, unappealable judgment aga inst the
868		-	transferor. In such action, the credi tor may proceed against the
869		-	transferred property or recover the value thereof in an amount up to
870		-	the amount of such judgment against the transferor.
871		-
	1428	+	time, but in any event not later than 5 years after the creditor has
	1429	+	obtained a final, unappealable judgment aga inst the transferor. In
	1430	+	such action, the credi tor may proceed against the transferred
	1431	+	property or recover the value thereof in an amount up to the amount
	1432	+	of such judgment against the transferor.
872	1433		C. This section and Section s 29, 31, 32, and 33 of this act are
873	1434		inseparably interwoven with substantive rig hts that a deprivation of
874	1435		legal rights would result if another jurisdiction's laws and
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875	1462		regulations to the contrary are applied to a cl aim or cause of
876	1463		action described therein.
877		-
878	1464		SECTION 31. NEW LAW A new section of law to be codified
879	1465		in the Oklahoma Statutes as Section 1313 of Title 6 0, unless there
880	1466		is created a duplication in numbering, reads as follows:
881		-
882	1467		A qualified disposition that is made by means of a disposition
883	1468		by a transferor who is a trustee is deemed to have been made as of
884	1469		the time, whether before, on, or after the effective date of this
885	1470		act, the property that is the subject of the qualified disposition
886	1471		was originally transferred to the transferor, or any predecessor
887	1472		trustee, making the qualified disposition in a form that me ets the
888	1473		requirements of paragraphs 2 and 3 of subsec tion A of Section 21 of
889	1474		this act. Further, the provisions of this section shall a pply to
890	1475		determine the date the transfer is deemed to have been made,
891	1476		notwithstanding that the original transfer was to a t rust originally
892	1477		within or outside of the jurisdictio n of Oklahoma.
893		-
894	1478		If property transferred to a spendthrift trust is conveyed to
895	1479		the settlor or to a beneficiary for the purpose of obtaining a loan
896	1480		secured by a mortgage or deed of trust on the property and then
897		-	reconveyed to the trust within one hundred eigh ty (180) days of ~~ENR. H. B. NO. 3962 Page 21~~
	1481	+	reconveyed to the trust within one hundred eigh ty (180) days of
898	1482		recording the mortgage or deed of trust, the transfer is disregar ded
899	1483		and the reconveyance relates back to the date the property was
900	1484		originally transferred to the trust. The mortgage or d eed of trust
901	1485		on the property is enforceable against the trust.
902	1486
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903	1512		SECTION 32. NEW LAW A new section of law to be codified
904	1513		in the Oklahoma Statutes as Section 1314 of Title 60, unless there
905	1514		is created a duplication in numbering, reads as follows:
906		-
907	1515		Notwithstanding any law to the contrary, a creditor, including a
908	1516		creditor whose claim arose before or after a qualified di sposition,
909	1517		or any other person has only such rights with respect to a qualified
910	1518		disposition as are provided in Sections 29 through 36 of this act,
911	1519		and no such creditor nor an y other person has any claim or cause of
912	1520		action against the trustee or advisor, de scribed in Section 24 of
913	1521		this act, of a trust that is the subject of a qualified disposition,
914	1522		or against any person involv ed in the counseling, drafting,
915	1523		preparation, executi on, or funding of a trust that is the subject of
916	1524		a qualified disposition. In addi tion to the provisions of Section
917	1525		37 of this act, at no time is a qualified person personally liable
918	1526		to a creditor of a tr ansferor or any other person for distributions
919	1527		made by the qualified person, before the creditor or person notified
920	1528		the qualified person, in writing, that a claim or cause of action
921	1529		existed. This applies regardless of whether the distributions are
922	1530		made to or for the benefit of the transferor or a beneficia ry during
923	1531		the period in which a creditor or other person could make a claim as
924	1532		provided in Section 30 of this act.
925		-
926	1533		SECTION 33. NEW LAW A new section of law to be codified
927	1534		in the Oklahoma Statutes as Section 1315 of Title 60, unless there
928	1535		is created a duplication in numbering, reads as follows:
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929	1561
930	1562		Notwithstanding any other provision of law, no action of any
931	1563		kind, including an action to enforce a judgment entered by a court
932	1564		or other body having adjudicative authority, may be brought at l aw
933	1565		or in equity against the trustee or advisor, described in Section 24
934	1566		of this act, of a trust that is the subject of a qualified
935	1567		disposition, or against any person involved in the counseling,
936	1568		drafting, preparation, execution, or funding of a trust that i s the
937	1569		subject of a qualified disposition, if, as of the date such action
938	1570		is brought, an action by a creditor with respect to such qualified
939	1571		disposition would be barred under Sections 29 through 32 of this
940	1572		act. A court of this state has exclusive jurisdict ion over an
941	1573		action brought under a claim for relief that is based on a transfer
942		-	of property to a trust that is the subject of this section. A court ~~ENR. H. B. NO. 3962 Page 22~~
	1574	+	of property to a trust that is the subject of this section. A court
943	1575		of this state may award attorney fees and costs to the prevailing
944	1576		party in such an action. In any action d escribed in this section,
945	1577		the burden to prove the matter by clear and convincing e vidence is
946	1578		upon the creditor.
947		-
948	1579		SECTION 34. NEW LAW A new section of law to be codified
949	1580		in the Oklahoma Statutes as Section 1316 of Title 60, unless th ere
950	1581		is created a duplication in numbering, reads as follows:
951		-
952	1582		If more than one qual ified disposition is made by means of the
953	1583		same trust instrument:
954		-
955	1584		1. The making of a subsequent qualified disposition shal l be
956	1585		disregarded in determining whether a creditor 's claim with respect
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957	1612		to a prior qualified disposition is extinguished as provided i n
958	1613		Section 30 of this act; and
959		-
960	1614		2. Any distribution to a beneficiary is deemed to have been
961	1615		made from the latest such quali fied disposition.
962		-
963	1616		SECTION 35. NEW LAW A new section of law to be codified
964	1617		in the Oklahoma Statutes as Section 1317 of Title 60, unless there
965	1618		is created a duplication in numbering, reads as follows:
966		-
967	1619		A. Notwithstanding the provision s of Sections 29 through 34 of
968	1620		this act, but subject to subsection B of this section, the Oklahoma
969	1621		Qualified Dispositions into Trust A ct does not apply in any respect
970	1622		to any person to whom at the time of transfer the transferor is
971	1623		indebted on account of an agreement or order of court for the
972	1624		payment of support or alimony in favor of the transferor 's spouse,
973	1625		former spouse, or children, or for a division or distribution of
974	1626		property in favor of the transferor 's spouse or former spouse, to
975	1627		the extent of the deb t.
976		-
977	1628		B. If the transferor is married at the time of t he transfer,
978	1629		the provisions of Sections 29 through 34 of this act, apply to:
979		-
980	1630		1. Any of the transferor 's separate property transferred to the
981	1631		trust; and
982		-
983	1632		2. Any marital property transferred to the trust i f the spouse
984	1633		or former spouse was provided with noti ce in the form set forth in
985	1634		subsection C of this section, or executed a written co nsent to the
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	1660	+
986	1661		transfer after being provided the information set forth in the
987		-	notice. ENR. H. B. NO. 3962 Page 23
988		-
	1662	+	notice.
989	1663		C. For purposes of the application of this section, a notice of
990	1664		transfer of property to a trust pursuant to the Oklahoma Qualified
991	1665		Dispositions into Trust Act:
992		-
993	1666		1. Shall also contain the following language in capital
994	1667		letters, at or near the top of the notice: YOUR SPOUSE IS CREATING
995	1668		A PERMANENT TRUST INTO WHICH PROPERTY IS BEING TRANSFERRED. YOUR
996	1669		RIGHTS TO THIS PROPERTY MAY BE AFFECTED DURING YOUR MARRIAGE, UPON
997	1670		DIVORCE (INCLUDING THE PAYMENT OF CHILD SUPPORT OR ALIMONY OR A
998	1671		DIVISION OR DISTRIBUTION OF PROPERTY IN A DIVORCE), OR AT THE DEATH
999	1672		OF YOUR SPOUSE. YOU HAVE A VERY LIMITED PERIOD OF TIME TO OBJECT TO
1000	1673		THE TRANSFER OF PROPERTY INTO THIS TRUST. YOU MAY, UPON REQUEST TO
1001	1674		THE TRUSTEE AT THE ADDRESS BELOW, BE FURNISHED A COPY OF THE TRUST
1002	1675		DOCUMENT. IF YOU HAVE ANY QUESTIONS, YOU SHOULD IM MEDIATELY SEEK
1003	1676		INDEPENDENT LEGAL ADVICE. IF YOU FAI L TO OBJECT WITHIN THE REQUIRED
1004	1677		TIME PERIOD, YOU WILL HAVE CONSENTED TO THE TRANSF ER OF PROPERTY
1005	1678		INTO THIS TRUST;
1006		-
1007	1679		2. Shall contain a description of the property being
1008	1680		transferred to the trust and the nam e of the trust;
1009		-
1010	1681		3. May require that any person who is eligible to receive
1011	1682		information pursuant to this section be bound by the duty o f
1012	1683		confidentiality that binds the trustee before receiving such
1013	1684		information from the trustee; and
1014	1685
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1015	1711		4. Shall be provided by the transferor, the transferor's agent,
1016	1712		the trustee, or other fiduciary of the trust.
1017		-
1018	1713		D. If a notice is provided under this section b efore the
1019	1714		property is transferred, the period to commence an action under
1020	1715		Section 30 of this act shall commence running on the date of the
1021	1716		transfer. If a notice is provided after the date the property is
1022	1717		transferred, the period to commence an action pursu ant to Section 30
1023	1718		of this act commences running on the date the notice is provided.
1024		-
1025	1719		E. The exception contained in subsect ion A of this section does
1026	1720		not apply to any claim fo r forced heirship or legitime.
1027		-
1028	1721		SECTION 36. NEW LAW A new section of law to be codified
1029	1722		in the Oklahoma Statutes as Section 1318 of Title 60, unless there
1030	1723		is created a duplication in numbering, reads as follows:
1031		-	ENR. H. B. NO. 3962 Page 24
1032	1724		A qualified disposit ion is avoided only to the extent necessary
1033	1725		to satisfy the transferor 's debt to the creditor at whose insistence
1034	1726		the disposition had been avoided, together with such costs,
1035	1727		including attorney fees, as the court may allow. If any qualified
1036	1728		disposition is avoided as provided in this section, then:
1037		-
1038	1729		1. If the court is satisfied that a qua lified person has not
1039	1730		acted in bad faith in accepting or administering the property that
1040	1731		is the subject of the qualified d isposition:
1041		-
1042	1732		a. such qualified person has a first and paramount lien
1043	1733		against the property that is the subject of the
1044	1734		qualified disposition in an amount equal to the entire
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1045	1761		cost, including attorney fees, properly incurred by
1046	1762		such qualified person in the defe nse of the action or
1047	1763		proceedings to avoid the qualif ied disposition. It is
1048	1764		presumed that such qualified person did not act in bad
1049	1765		faith merely by accepting such property, and
1050		-
1051	1766		b. the qualified disposition is avoided subject to the
1052	1767		proper fees, costs, preex isting rights, claims, and
1053	1768		interests of such qualifi ed person, and of any
1054	1769		predecessor qualified person that has not acted in bad
1055	1770		faith; and
1056		-
1057	1771		2. If the court is satisfied that a beneficiary of a trust has
1058	1772		not acted in bad faith, the avoidance of the qualifi ed disposition
1059	1773		is subject to the right of such benef iciary to retain any
1060	1774		distribution made upon the exercise of a trust power or discr etion
1061	1775		vested in the qualified person or qualified persons of such trust,
1062	1776		which power or discretion was properly exercised prior to the
1063	1777		creditor's commencement of an action to avoid the qualified
1064	1778		disposition. It is presumed that the beneficiary, including a
1065	1779		beneficiary who is also a transferor of the trust, did not act in
1066	1780		bad faith merely by creating the trust or by accepting a
1067	1781		distribution made in accordance with the terms of the trust.
1068		-
1069	1782		SECTION 37. NEW LAW A new section of law to b e codified
1070	1783		in the Oklahoma Statutes as Section 1319 of Title 60, unless there
1071	1784		is created a duplication in numbering, reads as follows:
1072	1785
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1073	1811		A. The following provisions apply only to discretionary
1074	1812		interests:
1075		-	ENR. H. B. NO. 3962 Page 25
1076	1813		1. A discretionary interest is neither a property in terest nor
1077	1814		an enforceable right. It is a mere expectancy;
1078		-
1079	1815		2. No creditor may force a distribution with regard to a
1080	1816		discretionary interest. No creditor may require the trus tee to
1081	1817		exercise the trustee 's discretion to make a distribution with regard
1082	1818		to a discretionary interest; and
1083		-
1084	1819		3. A court may review a trustee 's distribution discretion only
1085	1820		if the trustee:
1086		-
1087	1821		a. acts dishonestly,
1088		-
1089	1822		b. acts with an improper motive, or
1090		-
1091	1823		c. fails, if under a duty to do so, to act.
1092		-
1093	1824		B. A reasonableness standard may not be applied to the exercise
1094	1825		of discretion by the trustee with regard to a discretionary
1095	1826		interest. Other than for the circumstances l isted in this section,
1096	1827		a court has no jurisdiction t o review the trustee's discretion or to
1097	1828		force a distribution.
1098		-
1099	1829		C. Absent express l anguage to the contrary, in the event that
1100	1830		the distribution language in a discretionary interest permits
1101	1831		unequal distributions between beneficiaries or distributions to the
1102	1832		exclusion of other beneficiaries, the trustee may distribute all of
1103	1833		the accumulated, accrued, or undistributed income and principal to
1104	1834		one beneficiary in the trustee 's discretion.
1105	1835
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1106	1861		D. Regardless of whether a beneficiary has any outstanding
1107	1862		creditors, a trustee of a discretionary interest may directly pay
1108	1863		any expense on behalf of such ben eficiary and may exhaust the income
1109	1864		and principal of the trust for the benefit of such beneficiary. No
1110	1865		trustee is liable to any creditor for paying the expenses of a
1111	1866		beneficiary of a discretionary interest.
1112		-
1113	1867		SECTION 38. NEW LAW A n ew section of law to be codified
1114	1868		in the Oklahoma Statutes as Section 1401 of Title 60, unless there
1115	1869		is created a duplicati on in numbering, reads as follows:
1116		-
1117	1870		For all trusts created under this title, the rules against
1118	1871		perpetuities shall not apply, it being t he intent that trusts
1119	1872		created in this state may have perpetual duration if a timing
1120		-	provision or limit is not specified in the trust document. ENR. H. B. NO. 3962 Page 26
1121		-
	1873	+	provision or limit is not specified in the trust document.
1122	1874		SECTION 39. NEW LAW A new section of law to be codified
1123	1875		in the Oklahoma Statutes as Sect ion 1402 of Title 60, unless there
1124	1876		is created a duplication in numbering, reads as follows:
1125		-
1126	1877		A. Except as otherwise provid ed in subsection B of this
1127	1878		section, the trustee and the qualified beneficiaries may enter into
1128	1879		a binding nonjudicial settlement agreem ent with respect to any
1129	1880		matter involving a trust.
1130		-
1131	1881		B. A nonjudicial settlement agreement is valid only to the
1132	1882		extent it does not violate a material purpose of the trust and
1133	1883		includes terms and conditions that could be properly approved by the
1134	1884		court under this act or other applicable law.
1135	1885
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1136	1911		C. Matters that may be resolved by a nonjudicial settlement
1137	1912		agreement include, but are no t limited to:
1138		-
1139	1913		1. The interpretation or construction of the terms of the
1140	1914		trust;
1141		-
1142	1915		2. The approval of a trustee 's report or accounting;
1143		-
1144	1916		3. Direction to a trustee to refrain from performing a
1145	1917		particular act or the grant to a trustee of any necessary or
1146	1918		desirable power;
1147		-
1148	1919		4. The resignation or appointment of a trustee and the
1149	1920		determination of a trustee 's compensation;
1150		-
1151	1921		5. Transfer of a trust 's principal place of administration;
1152		-
1153	1922		6. Liability of a trustee for an action relating to the trust;
1154		-
1155	1923		7. The extent or wa iver of bond of a trustee;
1156		-
1157	1924		8. The governing law of the trust;
1158		-
1159	1925		9. The criteria for distribution to a beneficiary where the
1160	1926		trustee is given discretion;
1161		-
1162	1927		10. The resignation, appointment, and establishment of the
1163	1928		powers and duties of trust protectors or tr ust advisors; and
1164		-	ENR. H. B. NO. 3962 Page 27
1165	1929		11. The approval of an investment decision, delegation, policy,
1166	1930		plan, or program.
1167		-
1168	1931		D. Any qualified beneficiary or trustee may request the court
1169	1932		to approve a nonjudicial settlement agreement, to determine whether
1170	1933		the representation was a dequate, and to determine whether the
	1934	+
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1171	1960		agreement contains terms and conditions the court could have
1172	1961		properly approved.
1173		-
1174	1962		SECTION 40. AMENDATORY 60 O.S. 2021, Section 175.24, is
1175	1963		amended to read as follows:
1176		-
1177	1964		Section 175.24. A. In the absence of contrary or limiting
1178	1965		provisions in the tru st agreement or a subsequent order or decree of
1179	1966		a court of competent jurisdiction, the trustee of an express trust
1180	1967		is authorized:
1181		-
1182	1968		1. To exchange, reexchange, subdivide, develop, improve,
1183	1969		dedicate to public use, make or vacate public plats, adjust
1184	1970		boundaries, or partition real property, and to adjust differences in
1185	1971		valuation by giving o r receiving money or money 's worth. Easements
1186	1972		may be dedicated to public use without consideration if deemed by
1187	1973		the trustee to be for the best interest of the trust;
1188		-
1189	1974		2. To grant options and to sell real or personal property at
1190	1975		public auction or at privat e sale for cash, or upon credit secured
1191	1976		by lien upon the property sold or upon such property or a part
1192	1977		thereof or other property;
1193		-
1194	1978		3. To grant or take leases of real property and of all rights
1195	1979		and privileges above or below the surface of real property for any
1196	1980		term or terms, including exploration for and removal of oil, gas,
1197	1981		and other minerals, with or without options of purch ase, and with or
1198	1982		without covenants as to erection of buildings or as to renewals
	1983	+
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1199	2009		thereof, though through the term of the lease or rene wals thereof,
1200	2010		or of such options extend beyond the term of the trust;
1201		-
1202	2011		4. To raze existing party walls or buildings or ere ct new party
1203	2012		walls or buildings alone or jointly wit h owners of adjacent
1204	2013		property. To make ordinary repairs and in addition thereto s uch
1205	2014		extraordinary alterations in buildings or other structures which are
1206	2015		necessary to make the property productive. To ef fect and keep in
1207	2016		force, fire, rent, title, liability , casualty, or other insurance of
1208	2017		any nature, in any form and in any amount;
1209		-	ENR. H. B. NO. 3962 Page 28
1210	2018		5. To compromise, contest, arbitrate, or settle any and all
1211	2019		claims of or against the trust estate or the trustee as such. To
1212	2020		abandon property deemed by the trustee burdensome or valueless;
1213		-
1214	2021		6. To pay calls, assessments, and any other sums chargeable or
1215	2022		accruing against, or on account of shares of stock or other
1216	2023		securities in the hands of the trustee where such payment may be
1217	2024		legally enforceable against the trustee or any property of the
1218	2025		trust, or the trustee deems payment expedient and for the best
1219	2026		interest of the trust. To sell or exercise stock subscription or
1220	2027		conversion rights, participate in foreclosures, reorganizations,
1221	2028		consolidations, mergers, liquidations, pooling agreeme nts and voting
1222	2029		trusts; to assent to corporate sales, leases, and encumbrances, and
1223	2030		in general, except as limited by the particular trust agreement,
1224	2031		have and exercise all powers of an absolute owner in res pect of such
1225	2032		securities. In the exercise of the for egoing powers the trustee
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1226	2059		shall be authorized, where he or she deems such course expedient, to
1227	2060		deposit stocks, bonds, or other securities with any protective or
1228	2061		other committee formed by or at the instanc e of persons holding
1229	2062		similar securities, under such terms and conditions respecting the
1230	2063		deposit thereof as the trustee may approve. A ny stock or other
1231	2064		securities obtained by conversion, reorganization, consolidation,
1232	2065		merger, liquidation, or the exercise o f subscription rights shall be
1233	2066		free, unless the trus t agreement provides otherwise, from any
1234	2067		restrictions on sale or otherwise contain ed in the trust agreement
1235	2068		relative to the securities originally held;
1236		-
1237	2069		7. To make such investment directly or in the form of
1238	2070		securities of, or other interests in, any open -end or closed-end
1239	2071		management type investment company or investment trust registered
1240	2072		under the Investment Company Act of 1940, 15 U.S.C.A. , Section 80a-1
1241	2073		et seq.; provided, that the portfolio of such investm ent company or
1242	2074		investment trust is limited to United States Government government
1243	2075		obligations and to repurchase agreements fully colla teralized by
1244	2076		such United States Government government obligations, and provided
1245	2077		further, that any such investment company or investment trust shall
1246	2078		take delivery of such coll ateral, either directly or through an
1247	2079		authorized custodian;
1248		-
1249	2080		8. To borrow money or create an indebtedness or obligation
1250	2081		including any bond indebtedness or obligation, except as limited by
1251	2082		the provisions of the Oklahoma Trust Act;, and generally to execute
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1252	2109		any deed or other instrument and to do all things in relation to
1253	2110		such trust necessary or desirable for carrying out any of the above
1254		-	powers or incident to the purposes of such trust; and ENR. H. B. NO. 3962 Page 29
1255		-
	2111	+	powers or incident to the purposes of such trust; and
1256	2112		9. To employ attorneys, accountants, agents, and brokers
1257	2113		reasonably necessary in the administration of the trust estate;
1258	2114		permit real estate held in tr ust to be occupied by a surviving
1259	2115		spouse or minor child of the trustor and, where reasonably necessary
1260	2116		for the maintenance of the surviving wife spouse or minor child or
1261	2117		children, invest trust funds in real property to be used for a home
1262	2118		by such beneficiary; make any contracts pertaining to oil, gas, or
1263	2119		other natural resources as are customary in the community where the
1264	2120		real property held in trust is situated; in the trustee 's discretion
1265	2121		pay funeral expenses of any beneficiary actually receiving benefits
1266	2122		from the trust estate at the time of the death of the beneficiary.
1267		-
1268	2123		B. 1. In the exercise of its authority under paragraph 9 of
1269	2124		subsection A of this section, a trustee may pay, fr om the assets of
1270	2125		the trust, reasonable compensation and costs incurred in conn ection
1271	2126		with employment of attorneys, accountants, agents, and brokers
1272	2127		reasonably necessary in the administration of the trust estate.
1273		-
1274	2128		2. In the event of any legal proceeding reg arding the trust, a
1275	2129		trustee may pay the costs or attorney fees incurred in any
1276	2130		proceeding from the assets of the trust without the approval of any
1277	2131		person and without court authorization unless otherwise ordered by
1278	2132		the court in such legal proceeding.
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1279	2158
1280	2159		3. Unless expressly provided otherwise in a written employment
1281	2160		agreement, the creat ion of an attorney-client relationship between
1282	2161		an attorney and a pers on serving as a fiduciary shall not impose
1283	2162		upon the attorney any duties or obligations to other persons
1284	2163		interested in the estate, trust estate, or other fiduciary property,
1285	2164		even though fiduciary funds may be used to compensate the attorney
1286	2165		for legal services rendered to the fiduciary. This paragraph is
1287	2166		intended to be declaratory of the common law and governs
1288	2167		relationships in existence between attorneys and persons serving as
1289	2168		fiduciaries and any such relationship hereafter created.
1290		-
1291	2169		4. Whenever an attorney -client relationship exists between an
1292	2170		attorney and a fiduciary, communications between the attorney and
1293	2171		the fiduciary shall be subject to attorney -client privilege unless
1294	2172		waived by the fiduciary, even though fiduciary funds may be used to
1295	2173		compensate the attorney for legal services rendered to the
1296	2174		fiduciary. The existence of a fiduciary relationship between a
1297	2175		fiduciary and a beneficiary does not constitute or give rise to any
1298	2176		waiver of the privilege for communications between the attorney and
1299		-	the fiduciary. ENR. H. B. NO. 3962 Page 30
1300		-
	2177	+	the fiduciary.
1301	2178		C. The following rules of administration shall be applicable to
1302	2179		all express trusts but such rules shall not be exclusive of those
1303	2180		otherwise imposed by law unless contrary to these rules :
1304		-
1305	2181		1. Where a trustee is authorized to sell or dispose of land,
1306	2182		such authority shall include the right to sell or dispose of part
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1307	2209		thereof, whether the division is horizontal, ver tical, or made in
1308	2210		any other way, or undivided interests therein;
1309		-
1310	2211		2. Where a trustee is authorized by the trust agreement
1311	2212		creating the trust or by law to pay or apply capital money subject
1312	2213		to the trust for any purpose or in any manner, the trustee shall
1313	2214		have and shall be deemed always to have had power to raise the money
1314	2215		required by selling, converting, calling in, or mortgaging or
1315	2216		otherwise encumbering all or any part of the trust property for the
1316	2217		time being in possession;
1317		-
1318	2218		3. A trustee shall have a lien a nd may be reimbursed with
1319	2219		interest for, or pay or discharge out of the trust p roperty, either
1320	2220		principal or income or both, all advances made for th e benefit or
1321	2221		protection of the trust or its property and all expenses, losses,
1322	2222		and liabilities, not resulting from the negligence of the trustee,
1323	2223		incurred in or about the execution or pro tection of the trust or
1324	2224		because of the trustee holding or ownership o f any property subject
1325	2225		thereto; and
1326		-
1327	2226		4. When the happening of any event, including marriage,
1328	2227		divorce, attainment of a certain age, performance of educational
1329	2228		requirements, death, or any o ther event, affects distribution of
1330	2229		income or principal of trust esta tes, the trustees shall not be
1331	2230		liable for mistakes of fact prior to the actual knowledge or written
1332	2231		notice of such fact.
1333	2232
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1334	2258		C. D. The powers, duties, and responsibilities stated in the
1335	2259		Oklahoma Trust Act or the Oklahoma Uniform Prudent Investor Act
1336	2260		shall not be deemed to exclude other implied powers, duties, or
1337	2261		responsibilities not inconsistent herewith.
1338		-
1339	2262		D. E. The trustee shall pay all taxes and assessments levied or
1340	2263		assessed against the tr ust estate or the trustee by governmental
1341	2264		taxing or assessing agencie s.
1342		-
1343	2265		E. F. No trustee shall be required to give bond unless the
1344		-	instrument creating the trust, or a court of ~~competent~~ jurisdiction ~~ENR. H. B. NO. 3962 Page 31~~
	2266	+	instrument creating the trust, or a court of c ompetent jurisdiction
1345	2267		in its discretion upon the application of an interested party,
1346	2268		requires a bond to be given.
1347		-
1348	2269		SECTION 41. AMENDATORY 60 O.S. 2021, Section 175.47, is
1349	2270		amended to read as follows:
1350		-
1351	2271		Section 175.47. A. Except as otherwise provided in subsection
1352	2272		B of this section, the absolute power of aliena tion of real and
1353	2273		personal property, or either of them, shall not be s uspended by any
1354	2274		limitations or conditions whatever for a longer period than during
1355	2275		the continuance of a life or lives of the beneficiaries in being at
1356	2276		the creation of the estate and twent y-one (21) years thereafter.
1357	2277		The absolute power of alienation is not suspended if there is any
1358	2278		person in being who, alone or in combination with one or more
1359	2279		others, has the powe r to sell, exchange, or otherwise convey the
1360	2280		real or personal property. If th e terms of a trust do not suspend
1361	2281		the absolute power of alienation of any trust property beyond the
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1362	2308		term permitted in this subsection, the trust may exist in
1363	2309		perpetuity.
1364		-
1365	2310		B. The provisions of this section shall not apply when property
1366	2311		is given, granted, be queathed, or devised to:
1367		-
1368	2312		1. A charitable use;
1369		-
1370	2313		2. Literary, educatio nal, scientific, religious, or charitable
1371	2314		corporations for their sole use and benefit;
1372		-
1373	2315		3. Any cemetery corpo ration, society or association;
1374		-
1375	2316		4. The Department of Mental Health and Substa nce Abuse Services
1376	2317		as provided in Section 2 -111 of Title 43A of the O klahoma Statutes;
1377	2318		or
1378		-
1379	2319		5. Gifts absolute, limited, or in trust, for the advancement of
1380	2320		medical science to an i ncorporated state society of physicians and
1381	2321		surgeons.
1382		-
1383	2322		C. Except as provided i n this section, the common law rule
1384	2323		against perpetuities shall not ap ply to a trust subject to the trust
1385	2324		laws of this state. A trust created in this state or subject to the
1386	2325		trust laws of this state may have a perpetual duration if a timing
1387	2326		provision or limit is not specified in the trust document.
1388		-	ENR. H. B. NO. 3962 Page 32
1389	2327		SECTION 42. AMENDATORY 60 O.S. 2021, Section 175.57, is
1390	2328		amended to read as follows:
1391		-
1392	2329		Section 175.57. A. A vi olation by a trustee of a duty the
1393	2330		trustee owes a beneficiary is a breach of t rust.
1394	2331
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1395	2357		B. To remedy a breach of trust that has occurred or may occur,
1396	2358		the court may:
1397		-
1398	2359		1. Compel the trustee to perform the trustee 's duties;
1399		-
1400	2360		2. Enjoin the trustee from committin g a breach of trust;
1401		-
1402	2361		3. Compel the trustee to redress a breach of trust by pa yment
1403	2362		of money or otherwise;
1404		-
1405	2363		4. Order a trustee to account;
1406		-
1407	2364		5. Appoint a receiver or temporary trustee to take possession
1408	2365		of the trust property and administer the trust;
1409		-
1410	2366		6. Suspend or remove the trustee;
1411		-
1412	2367		7. Reduce or deny compensation to the trustee;
1413		-
1414	2368		8. Subject to subsection I of this section, void an act of the
1415	2369		trustee, impose an equitable lien or a constructive trust on trust
1416	2370		property, or trace trust property wrongfully dis posed of and recover
1417	2371		the property or its proceeds; or
1418		-
1419	2372		9. Grant any other appr opriate remedy.
1420		-
1421	2373		C. A beneficiary may charge a trustee who commits a breach of
1422	2374		trust with the amount required to restore the value of the trust
1423	2375		property and trust distributions t o what they would have been had
1424	2376		the breach not occurred, or, if greater, the p rofit that the trustee
1425	2377		made by reason of the breach.
1426		-
1427	2378		D. In a judicial proceeding involving a trust, the court may in
1428	2379		its discretion, as justice and equity may require, award cos ts and
1429	2380		expenses, including reasonable attorney's attorney fees, to any
	2381	+
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1430	2407		party, to be paid by another party or from the trust which is the
1431	2408		subject of the controversy.
1432		-	ENR. H. B. NO. 3962 Page 33
1433	2409		E. 1. Unless previously barred by adjudication, consent, or
1434	2410		other limitation, a claim aga inst a trustee for breach of trust is
1435	2411		barred as to a beneficiary who has recei ved from the trustee a
1436	2412		report or other statement adequately disclosin g the existence of the
1437	2413		claim unless:
1438		-
1439	2414		a. a judicial proceeding to assert the claim is commenced
1440	2415		within two (2) years after receipt of the report or
1441	2416		statement or, if no report or statement is received,
1442	2417		within two (2) years after the termination of the
1443	2418		trust relationship between the beneficiary and that
1444	2419		particular trustee, and
1445		-
1446	2420		b. the report or other statement inform s the beneficiary
1447	2421		of this time limitation.
1448		-
1449	2422		A report or statement adequately di scloses the existence of a
1450	2423		claim if it provides sufficient informatio n so that the beneficiary
1451	2424		knows of the claim or reasonably should have inquired into its
1452	2425		existence. A claim this barred does not include an action to
1453	2426		recover for fraud or misrepresentati on related to the report or
1454	2427		other statement For purposes of this subsection, "accounting" means
1455	2428		any interim or final report or other statement provided by a trustee
1456	2429		reflecting all transactions, receipts, and disbursements during the
	2430	+
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	2455	+
1457	2456		reporting period and a list of assets as of the end of the period
1458	2457		covered by the report or s tatement.
1459		-
1460	2458		2. For any trust that is before a district court under
1461	2459		subsection A of Section 175.23 of this titl e, the trustee may submit
1462	2460		an accounting and seek approval of the accounting by the court.
1463	2461		Such accounting and the final approval by a district cou rt, whether
1464	2462		or not such accounting is contested, shall be conclusive against all
1465	2463		persons interested in the tr ust, and the trustee, absent fraud,
1466	2464		intentional misrepresentation, or material omission, shall be
1467	2465		released and discharged from any and all liabilit y as to all matters
1468	2466		set forth in the accounting.
1469		-
1470	2467		3. If a trust is not before a district court under subsecti on A
1471	2468		of Section 175.23 of this title and if no objection has been made by
1472	2469		a beneficiary who is an eligible distributee or permissible
1473	2470		distributee of the trust's income or principal within one hundred
1474	2471		eighty (180) days after a copy of the trustee 's accounting has been
1475	2472		provided to such beneficiaries together with written notice of the
1476	2473		provisions of this section, the distribution beneficiary is deemed
1477		-	to have approved such accounting of the trustee, and the trustee, ~~ENR. H. B. NO. 3962 Page 34~~
	2474	+	to have approved such accounting of the trustee, and the trustee,
1478	2475		absent fraud, intentional misrepresentation, or material omission,
1479	2476		shall be released and discharged from any and all liabi lity to all
1480	2477		beneficiaries of the trust as to all matters set forth in such
1481	2478		accounting.
	2479	+
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1482	2504
1483	2505		4. If paragraphs 2 and 3 of this subsection do not apply,
1484	2506		absent fraud, intentional misrep resentation, or material omission,
1485	2507		an action to recover for breach of trust ag ainst a trustee who is a
1486	2508		resident of this state or who has its princi pal place of business in
1487	2509		this state, or an officer, director, or employee of such trustee may
1488	2510		be commenced only within two (2) years of a trustee's accounting for
1489	2511		the period of the breach . In the case of fraud, intentional
1490	2512		misrepresentation, or material o mission, the limitation period shall
1491	2513		not commence until discovery of the breach of trust .
1492		-
1493	2514		2. 5. For the purpose of paragraph 1 of this subsection, a
1494	2515		beneficiary is deemed to have receive d a report or other statement:
1495		-
1496	2516		a. in the case of an adult, if it is r eceived by the
1497	2517		adult personally, or if the adult lacks capacity, if
1498	2518		it is received by the adult 's conservator, guardian,
1499	2519		or agent with authority, or
1500		-
1501	2520		b. in the case of a minor, if it is re ceived by the
1502	2521		minor's guardian or conservator or, if the minor does
1503	2522		not have a guardian or conservator, if it is received
1504	2523		by a parent of the minor who does not have a conflict
1505	2524		of interest.
1506		-
1507	2525		3. 6. Except as otherwise provided by the terms of a trust,
1508	2526		while the trust is revocable and the settlor has capacity to revoke,
1509	2527		the rights of the beneficiaries are held by, and the duties of the
1510	2528		trustee are owed exclusively to , the settlor; the rights to be held
	2529	+
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	2554	+
1511	2555		by and owed to the beneficiaries arise only upon the settl or's death
1512	2556		or incapacity. The trustee may follow a written direction of the
1513	2557		settlor, even if contrary to the terms of the trust. The holder of
1514	2558		a presently exercisable power of withdrawal or a testamentary
1515	2559		general power of appointment has the rights of a settlor of a
1516	2560		revocable trust under this section to the extent of the property
1517	2561		subject to the power.
1518		-
1519	2562		F. 1. A term of the trust relieving a trustee of liability for
1520	2563		breach of trust is unenforceable to the extent that it:
1521		-	ENR. H. B. NO. 3962 Page 35
1522	2564		a. relieves a trustee of liability for breach of trust
1523	2565		committed in bad faith or with reckless indiffere nce
1524	2566		to the purposes of the trust or the interest of the
1525	2567		beneficiaries, or
1526		-
1527	2568		b. was inserted as the result of an abuse by the trustee
1528	2569		of a fiduciary or confidential relationship to the
1529	2570		settlor.
1530		-
1531	2571		2. An exculpatory term drafted by or on behalf of the trustee
1532	2572		is presumed to have been inserted as a result of an abuse of a
1533	2573		fiduciary or confidential relationship unless th e trustee proves
1534	2574		that the exculpatory term is fair under the circumstances and that
1535	2575		its existence and contents were adequately communicated to the
1536	2576		settlor.
1537		-
1538	2577		G. A beneficiary may not hold a trustee liable for a breach of
1539	2578		trust if the beneficiary, while havi ng capacity, consented to the
	2579	+
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1540	2605		conduct constituting the breach, released the tr ustee from liability
1541	2606		for the breach, or ratified the transaction cons tituting the breach,
1542	2607		unless:
1543		-
1544	2608		1. The beneficiary at the time of the consent, release, or
1545	2609		ratification did not know of the beneficiary 's rights and of the
1546	2610		material facts that the trustee k new, or with the exercise of
1547	2611		reasonable inquiry, the beneficiary shou ld have known, and that the
1548	2612		trustee did not reasonably believe that the beneficiary knew; or
1549		-
1550	2613		2. The consent, release, or ratification of the beneficiary was
1551	2614		induced by improper conduct o f the trustee.
1552		-
1553	2615		H. 1. Except as otherwise agreed, a trustee is not p ersonally
1554	2616		liable on a contract properly entered into in the trustee 's
1555	2617		fiduciary capacity in the course of adm inistration of the trust if
1556	2618		the trustee in the contract discloses the fiduciar y capacity.
1557		-
1558	2619		2. A trustee is personally liable for obligations arisin g from
1559	2620		ownership or control of trust property, or for torts committed in
1560	2621		the course of administering a trust, only if the trustee is
1561	2622		personally at fault, whether negligently or intentiona lly.
1562		-
1563	2623		3. A trustee who does not join in exercising a power held by
1564	2624		three or more trustees is not liable to third persons for the
1565	2625		consequences of the exercise of the power. A dis senting trustee who
1566		-	joins in an action at the direction of the majority cotrus tees is ~~ENR. H. B. NO. 3962 Page 36~~
	2626	+	joins in an action at the direction of the majority cotrus tees is
1567	2627		not liable to third persons for the action if the dissenting trustee
	2628	+
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	2651	+	23
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	2653	+
1568	2654		expressed the dissent in writing to any other cotrustee at or before
1569	2655		the time the action was taken.
1570		-
1571	2656		4. A claim based on a contract entered into by a trustee in the
1572	2657		trustee's fiduciary capacity, on an obligation arising from
1573	2658		ownership or control of trust property, or on a tort committed in
1574	2659		the course of administering a trust, may be asserted against the
1575	2660		trust in a judicial proceeding against the trustee in the trustee 's
1576	2661		fiduciary capacity, whether or not the trustee is personally liable
1577	2662		on the claim.
1578		-
1579	2663		I. 1. A person who in good faith assists a trustee or who in
1580	2664		good faith and for value deals with a truste e without knowledge that
1581	2665		the trustee is exceeding or improperly exercising the trustee's
1582	2666		powers is protected from liability as if the trustee prope rly
1583	2667		exercised the power.
1584		-
1585	2668		2. Dealing in good faith with another person with knowledge
1586	2669		that the other person i s a trustee does not place a third person on
1587	2670		notice to inquire into the extent of the trustee's powers or the
1588	2671		propriety of their his or her exercise.
1589		-
1590	2672		3. A person who in good faith deals with another person with
1591	2673		knowledge that the other person is a trustee is not solely on that
1592	2674		account placed on notice to inquire into the extent of the trustee's
1593	2675		powers or the propriety of their his or her exercise or to see to
1594	2676		the proper application of assets of the trust paid or delivered to a
1595	2677		trustee.
1596	2678
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	2693	+	15
	2694	+	16
	2695	+	17
	2696	+	18
	2697	+	19
	2698	+	20
	2699	+	21
	2700	+	22
	2701	+	23
	2702	+	24
	2703	+
1597	2704		4. A person who in good faith assists a former trustee or who
1598	2705		for value and in good faith deals w ith a former trustee without
1599	2706		knowledge that the person is no longer a trustee is protected from
1600	2707		liability as if the former trustee were still a trustee.
1601		-
1602	2708		5. The protection provid ed by this section to persons assisting
1603	2709		or dealing with a trustee is secondary to that provided under
1604	2710		comparable provisions of other laws relating to commercial
1605	2711		transactions or to the transfer of securities by fiduciaries.
1606		-
1607	2712		SECTION 43. This act shall become effective November 1, 2024.
1608	2713
1609		-	ENR. H. B. NO. 3962 Page 37
1610		-	Passed the House of Representatives the 22nd day of May, 2024.
1611		-
1612		-
1613		-
1614		-
1615		-	Presiding Officer of the House
1616		-	of Representatives
1617		-
1618		-
1619		-
1620		-	Passed the Senate the 29th day of May, 2024.
1621		-
1622		-
1623		-
1624		-
1625		-	Presiding Officer of the Senate
1626		-
1627		-
1628		-	OFFICE OF THE GOVERNOR
1629		-	Received by the Office of the Governor this ____________________
1630		-	day of ___________________, 20_______, at _______ o'clock _______ M.
1631		-	By: _________________________________
1632		-	Approved by the Governor of the State of Oklahoma this _____ ____
1633		-	day of ___________________, 20_______, at _______ o'clock _______ M.
1634		-
1635		-
1636		-	_________________________________
1637		-	Governor of the State of Oklahoma
1638		-
1639		-	OFFICE OF THE SECRETARY OF STATE
1640		-	Received by the Office of the Secretary of State this __________
1641		-	day of ___________________, 20_______, at _______ o'clock _______ M.
1642		-	By: _________________________________
	2714	+	59-2-11102 JL 05/10/24
	2715	+