TITLE LVI
PROBATE COURTS AND DECEDENTS' ESTATES

Chapter 564-A
CERTAIN PROVISIONS REGARDING TRUSTS

Section 564-A:1

    564-A:1 Definitions. –
As used in this chapter:
I. "Trust" means an express trust created by: a judgment or decree of the probate court, including a special needs trust authorized by 42 U.S.C. 1396p(d)(4)(A) and (C); and a trust instrument, including a will, whereby a trustee has the duty to administer a trust asset for the benefit of a named or otherwise described income or principal beneficiary, or both. "Trust" does not include a resulting or constructive trust, a business trust which provides for certificates to be issued to the beneficiary, an investment trust, a voting trust, a security instrument, a trust created by the judgment or decree by any other court, a liquidation trust, or a trust for the primary purpose of paying dividends, interest, interest coupons, salaries, wages, pensions or profits, or employee benefits of any kind, an instrument wherein a person is nominee or escrowee for another, a trust created in deposits in any financial institution, or other trust the nature of which does not admit of general trust administration;
II. "Trustee" means an original, added, or successor trustee;
III. [Repealed.]

Source. 1969, 312:1. 2004, 130:9, IV, eff. Oct. 1, 2004. 2008, 97:2, eff. May 21, 2008.

Section 564-A:2

    564-A:2 Repealed by 2004, 130:9, V, eff. Oct. 1, 2004. –

Section 564-A:3

    564-A:3 Limitations on Certain Trustees who are Beneficiaries. –
I-III. [Repealed.]
IV. (a) (1) Due to the inherent conflict of interest that exists between a trustee who is a beneficiary and other beneficiaries of the trust, unless the terms of a trust refer specifically to this paragraph and provide expressly to the contrary, any power conferred upon a trustee (other than the settlor of a revocable or amendable trust or a decedent's or settlor's spouse who is a trustee of a testamentary or inter vivos trust for which a marital deduction has been allowed) shall not include the following:
(A) To make discretionary distributions of either principal or income to or for the benefit of such trustee, except to provide for that trustee's health, education, maintenance, or support as described under Internal Revenue Code sections 2041 and 2514.
(B) To make discretionary allocations of receipts or expenses as between principal and income, unless such trustee acts in a fiduciary capacity whereby such trustee has no power to enlarge or shift any beneficial interest except as an incidental consequence of the discharge of such trustee's fiduciary duties.
(C) To make discretionary distributions of either principal or income to satisfy any legal support obligations of such trustee.
(D) To exercise any other power, including the right to remove or to replace any trustee, so as to cause the powers enumerated under subparagraph (A)-(C) to be exercised on behalf of, or for the benefit of, a beneficiary who is also a trustee.
(2) Any of the powers described in subparagraph (1) that are conferred upon 2 or more trustees may be exercised by the trustees who are not so disqualified. If there is no trustee qualified to exercise such power, any party in interest, as defined in subparagraph (c), may apply to a court of competent jurisdiction to appoint an independent trustee and such power may be exercised by the independent trustee appointed by the court.
(b) (1) This paragraph applies to:
(A) Any trust executed after the effective date of this paragraph, unless the terms of the trust refer specifically to this subparagraph and provide expressly to the contrary;
(B) Any testamentary trust created under a will executed after the effective date of this paragraph, unless the terms of the trust refer specifically to this subparagraph and provide expressly to the contrary; and
(C) Any trust created under a document executed on or before the effective date of this paragraph, unless:
(i) If the trust is revocable or amendable, the settlor revokes or amends the trust at any time to provide otherwise; or
(ii) If the trust is irrevocable, all parties in interest, as defined in subparagraph (c), elect affirmatively, in the manner prescribed in subparagraph (d), not to be subject to this paragraph. Such election must be made on or before the later of 3 years after the effective date of this paragraph, or 3 years after the date on which the trust becomes irrevocable.
(2) The provisions of this subparagraph neither create a new cause of action nor impair any existing cause of action which, in either case, relates to any power prescribed by subparagraph (a) that was exercised before the effective date of this paragraph.
(c) For the purpose of this paragraph:
(1) If the trust is revocable or amendable and the settlor is not incapacitated, the party in interest is the settlor.
(2) If the trust is revocable or amendable and the settlor is incapacitated, the party in interest is the settlor's legal representative under applicable law or the settlor's agent under a durable power of attorney that is sufficient to grant such authority.
(3) If the trust is not revocable or amendable, the parties in interest are:
(A) Each trustee then serving;
(B) Each income beneficiary then in existence or if any such beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's legal representative under applicable law or the beneficiary's agent under a durable power of attorney that is sufficient to grant such authority; and
(C) Each remainder beneficiary then in existence or, if any such remainder beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's legal representative under applicable law or the beneficiary's agent under a durable power of attorney that is sufficient to grant such authority.
(d) The affirmative election required under subparagraph (b) shall be made:
(1) If the settlor is not incapacitated and the trust is revocable or amendable, through a revocation of or an amendment to the trust;
(2) If the settlor is incapacitated and the trust is revocable or amendable, through a written declaration executed in the manner prescribed for the recordation of deeds and delivered to the trustee; or
(3) If the trust is not revocable or amendable, through a written declaration executed in the manner prescribed for the recordation of deeds and delivered to the trustee.
(e) A person who has the right to remove or to replace a trustee does not possess, nor may that person be deemed to possess by virtue of having that right, the powers of a trustee who is subject to removal or replacement.

Source. 1969, 312:1. 1996, 96:1, 2. 1998, 128:2. 2004, 130:9, VI-VIII. 2005, 270:35, eff. Sept. 20, 2005.

Section 564-A:3-a

    564-A:3-a Powers of Fiduciaries in Environmental Matters; Costs; Liability. –
I. The general court has determined that it will benefit the public health, safety, and welfare to empower fiduciaries to assess fiduciary property to determine environmental condition, to prevent and remediate contamination, and to otherwise bring fiduciary property into compliance with environmental laws.
II. In this section:
(a) "Environmental laws" means any federal, state or local law, rule, regulation, or ordinance relating to protection of the environment or human health.
(b) "Fiduciary" means any individual, partnership, corporation, firm, or any other entity and any officer, employee, or agent of such fiduciary, who is acting in any of the following capacities:
(1) Executor, administrator, guardian, or conservator.
(2) Trustee under a will or inter vivos instrument creating a trust under which the trustee takes title to, or otherwise controls or manages, property for the purpose of protecting or conserving such property under the ordinary rules applied in the probate courts of this state.
(3) Court-appointed receiver.
(4) Trustee appointed in proceedings under federal bankruptcy laws.
(5) Assignee or trustee acting under an assignment made for the benefit of creditors under the laws of this state.
(6) Trustee pursuant to an indenture agreement or similar financing agreement for debt securities, certificates of interest of participation in any such debt securities, or any successor to any of the foregoing.
(c) "Hazardous substances" mean oil as defined in RSA 146-A:2, III or any substance defined as hazardous or toxic under RSA 147-A:2, VII or otherwise regulated by any environmental laws.
III. Unless expressly limited by the instrument, judgment, decree, or order establishing the fiduciary relationship, a fiduciary shall have, in its discretion, the following powers, provided that the fiduciary shall disclose in writing to the person or persons to whom the fiduciary sends communications or statements relating to the property held in a fiduciary capacity, the fiduciary's intent to exercise any or all of the authority granted in this section prior to the first exercise of such authority:
(a) To inspect and monitor real and personal property to which the fiduciary takes legal title (including, without limitation, interests in sole proprietorships, partnerships, or corporations and any assets owned by such business enterprises) or over which a fiduciary may exercise control, for the purposes of determining compliance with environmental laws affecting such property, and to respond to actual or threatened violations of any environmental laws affecting such property held or controlled by the fiduciary.
(b) To take, on behalf of an estate, person or business, any action necessary to prevent, abate, or otherwise remedy any actual or threatened release of hazardous substances or violation of any environmental laws affecting real or personal property held or controlled by the fiduciary, either before or after the initiation of an enforcement action by any government body.
(c) To refuse to accept real or personal property in trust if:
(1) Such property either is or may be contaminated by any hazardous substances, or such property is being used or has been used for any activities directly or indirectly involving hazardous substances, which could impair the value of the assets therein held or controlled; or
(2) Such property may be in violation of any environmental laws.
(d) To settle or compromise, at any time, any and all claims against the estate, trust, person or business which may be asserted by any governmental body or private body, involving the alleged release or threatened release of hazardous substances and the alleged violation of any environmental laws affecting real or personal property held by the estate or trust or owned by the person or business.
(e) To release or disclaim at any time or times any power granted by any document or any statute or rule of law which, in the sole discretion of the fiduciary, may expose the fiduciary to liability in the fiduciary's individual capacity under the environmental laws or impair the value of the assets retained or controlled by the fiduciary.
IV. A fiduciary may charge the reasonable cost of any abatement, cleanup, inspection, assessment, insurance, database review, monitoring, or any other response or remedial action, as authorized under this chapter, against the income or principal for the estate, trust, personal estate, or business assets, and shall not be personally responsible therefor.
V. (a) Nothing in this section shall be construed to alter or affect a fiduciary's liability or obligations as otherwise established by environmental laws. The fiduciary's failure to exercise powers granted under this section in and of itself shall not create a cause of action against the fiduciary. A fiduciary shall not be liable in its individual capacity to any beneficiary or any other party for any action taken with the approval of a governmental agency with responsibility for environmental compliance. A fiduciary shall not be liable in its individual capacity to a beneficiary or any other party for any other action taken to:
(1) Assess potential environmental contamination of fiduciary property; or
(2) Bring fiduciary property into compliance with environmental laws where the fiduciary acts reasonably and prudently.
(b) In particular, a fiduciary shall not be liable for any decrease in value or exhaustion of assets by reason of actions taken in accordance with this section.

Source. 1995, 38:1, eff. June 23, 1995.

Section 564-A:3-b

    564-A:3-b Repealed by 2004, 130:9, IX, eff. Oct. 1, 2004. –

Section 564-A:3-c

    564-A:3-c Repealed by 2008, 374:25, eff. Sept. 9, 2008. –

Section 564-A:4

    564-A:4 Repealed by 2004, 130:9, X, eff. Oct. 1, 2004. –

Section 564-A:5

    564-A:5 Power of Court to Permit Deviation or to Approve Transactions Involving Conflict of Interest. –
I. This chapter does not affect the power of the probate court for cause shown and upon petition of the trustee or affected beneficiary and upon appropriate notice to the affected parties to relieve a trustee from any restrictions on the trustee's power that would otherwise be placed upon the trustee by the trust or by this chapter.
II. [Repealed.]

Source. 1969, 312:1. 1992, 284:72. 2004, 130:9, XI, eff. Oct. 1, 2004.

Section 564-A:6

    564-A:6 Repealed by 2004, 130:9, XII, eff. Oct. 1, 2004. –

Section 564-A:7

    564-A:7 Third Persons Protected in Dealing with Trustee. –
I. [Repealed.]
II. The filing by a trustee of a written certificate signed by the trustee, filed and recorded as hereinafter set forth and in substantially the following form shall be conclusive evidence and notice to all third parties that the trustee named therein and the trustee's successors have full and absolute power to convey any interest in real estate and improvements thereon held by the trustee and no third person or purchaser, without actual knowledge to the contrary, shall be obligated to further inquire as to the power or authority of the trustee to convey or to see to the application of any trust assets paid or delivered to the trustee.
The undersigned trustee(s) as Trustee(s) under the __________ Trust created by __________ as grantor under trust agreement dated __________, and thereto have full and absolute power in said trust agreement to convey any interest in real estate and improvements thereon held in said trust and no purchaser or third party shall be bound to inquire whether the trustee has said power or is properly exercising said power or to see to the application of any trust asset paid to the trustee for a conveyance thereof.
____________________
, Trustee

III. A similar certificate filed by any successor to the trustee named in an original or any subsequent certificate shall have the same effect as the original certificate. Such a certificate, in writing, executed with the formalities required for a deed of real property by the trustee or trustees of the trust and recorded in the registry of deeds in the county in which the real estate and improvements lie shall conclusively establish the power of the trustee to convey said real estate and improvements as set forth above.
IV. A written certificate signed by a trustee with signature sworn to before a notary public, delivered to the transferee or a transfer agent in substantially the following form, shall be conclusive evidence and notice to all third parties that the trustee named therein and the trustee's successors have full and absolute power to convey any interest in personal property, tangible or intangible, held by the trustee and no third person or purchaser, without actual knowledge to the contrary, shall be obligated to further inquire as to the power or authority of the trustee to convey or to see to the application of any trust assets paid or delivered to the trustee.
The undersigned trustee(s) as Trustee(s) under the __________ Trust created by __________ as grantor under trust agreement dated __________, and thereto have full and absolute power in said trust agreement to convey any interest in personal property held in said trust and no purchaser or third party shall be bound to inquire whether the trustee has said power or is properly exercising said power or to see to the application of any trust asset paid to the trustee for a conveyance thereof.
V. A similar certificate signed by any successor to the trustee named in an original or any subsequent certificate shall have the same effect as the original certificate. Such a certificate, in writing, sworn to, and delivered in the same manner as the prior trustee's certificate, shall conclusively establish the power of the successor trustee to convey said personal property.

Source. 1969, 312:1. 1977, 84:1. 1995, 216:4. 1999, 111:1. 2004, 130:9, XIII, eff. Oct. 1, 2004.

Section 564-A:8

    564-A:8 Applicability of Chapter. – Except as specifically provided in the trust, the provisions of this chapter apply to any trust established after the effective date of this chapter and to any trust asset acquired by the trustee after the effective date of this chapter.

Source. 1969, 312:1, eff. Aug. 29, 1969.

Section 564-A:9

    564-A:9 Uniformity of Interpretation. – This chapter shall be construed to effectuate its general purpose to make uniform the law of those states which enact it.

Source. 1969, 312:1, eff. Aug. 29, 1969.

Section 564-A:10

    564-A:10 Repealed by 2005, 270:36, eff. Sept. 20, 2005. –

Section 564-A:11

    564-A:11 Severability. – If any provision of this chapter or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the chapter which can be given effect without the invalid provision or application, and to this end the provisions of this chapter are severable.

Source. 1969, 312:1, eff. Aug. 29, 1969.