SB759,,255255(16) Encumbered assets; payment of debt. (a) Rights of secured claimants not affected. Nothing in this subchapter shall affect or prevent any action or proceeding to enforce any mortgage, pledge, lien, or other security agreement against property of the trust.
SB759,,256256(b) Payment. When any property in the trust is encumbered by mortgage, pledge, lien, or other security agreement, the trustee may pay the encumbrance or any part of the encumbrance, renew or extend any obligation secured by the encumbrance, or may convey or transfer the encumbered assets to the creditor in satisfaction of the claimant’s lien, in whole or in part, whether or not the holder of the encumbrance has filed a claim.
SB759,,257257(17) Tort claims. (a) Filed within time limited. If a claim based on a cause of action in tort or for contribution resulting from a cause of action in tort is filed on or before the deadline for filing a claim under s. 701.0508, the claimant will receive the same protection in regard to payment as a claimant who has filed a required claim.
SB759,,258258(b) Not filed within time limited. A cause of action against a deceased settlor in tort or for contribution resulting from a cause of action in tort is not defeated by failure to file the claim or commence or continue an action against the trustee on or before the deadline for filing a claim under s. 701.0508 against a trust, but the failure to file the claim with the trustee relieves the trustee of all responsibility to protect the rights of the claimant, and the claimant shall not be granted any of the protections under sub. (5). If the claim is determined to be valid and absolute through court-approved settlement or adjudication and a certified copy of the settlement or judgment is filed with the trustee and there are sufficient funds in the trust to pay the claim, the claim shall be paid prior to the distribution of the trust. After the trust has been distributed or if there are not sufficient funds in the trust, a claimant whose claim has been determined to be valid and absolute through court-approved settlement or through adjudication may proceed against the distributees, but no distributee may be liable for an amount greater than that allowed under sub. (6).
SB759,,259259(18) Payment of unfiled claims. A trustee may pay a debt of a deceased settlor prior to the expiration of the deadline for filing claims under s. 701.0508 whether or not a claim is filed if the trustee reasonably believes that the debt is owed and that the assets of the trust are sufficient to satisfy all of the deceased settlor’s debts.
SB759,,260260(19) Last illness and funeral expense of deceased spouse. The reasonable expense of the last illness and funeral may, if properly presented, be paid by the trustee of a deceased settlor’s trust and, if so paid, shall be recognized as valid expenditures even though the surviving spouse of the deceased settlor could have been held liable for the expense.
SB759,87261Section 87. 701.0602 (1) of the statutes is amended to read:
SB759,,262262701.0602 (1) Unless the terms of a trust expressly provide that the trust is irrevocable, there is a rebuttable presumption that the settlor may revoke or amend the trust. This subsection does not apply to a trust created under an instrument executed before July 1, 2014.
SB759,88263Section 88. 701.0602 (3) (intro.), (a) and (b) (intro.) of the statutes are consolidated, renumbered 701.0602 (3) (intro.) and amended to read:
SB759,,264264701.0602 (3) (intro.) A settlor may revoke or amend a revocable trust by any of the following means: (a) By substantial compliance with a method provided in the terms of the trust. (b) (intro.) If, or, if the terms of the trust do not provide a method, by any of the following means:
SB759,89265Section 89. 701.0602 (3) (b) 1. of the statutes is renumbered 701.0602 (3) (am).
SB759,90266Section 90. 701.0602 (3) (b) 2. of the statutes is renumbered 701.0602 (3) (bm).
SB759,91267Section 91. 701.0602 (4) of the statutes is amended to read:
SB759,,268268701.0602 (4) Upon revocation of a revocable trust, the trustee shall transfer the trust property to the settlor or as the settlor directs. However, with respect to marital or community property, the trustee shall transfer the property to both spouses as marital or community property or as both spouses direct.
SB759,92269Section 92. 701.0605 of the statutes is created to read:
SB759,,270270701.0605 Future interests in trust. Subject to s. 701.1204, unless a contrary intention is found, if a person has a future interest in property under a revocable trust and, under the terms of the trust, the person has the right to possession and enjoyment of the property at the settlor’s death, the right to possession and enjoyment is contingent on the person surviving the settlor. Extrinsic evidence may be used to show contrary intent.
SB759,93271Section 93. 701.0702 (3) of the statutes is amended to read:
SB759,,272272701.0702 (3) A court may not require a bond from a trust company bank, state bank, or national bank that is authorized to exercise trust powers and that has complied with s. 220.09 or 223.02 nor shall a bond be required of a religious, charitable, or educational corporation or society.
SB759,94273Section 94. 701.0704 (1) (g) of the statutes is created to read:
SB759,,274274701.0704 (1) (g) Any other event occurs resulting in no person acting as trustee.
SB759,95275Section 95. 701.0706 (2) (c) of the statutes is amended to read:
SB759,,276276701.0706 (2) (c) The court determines that removal Removal of the trustee best serves the interests of the beneficiaries is appropriate because of unfitness, unwillingness, or persistent failure of the trustee to administer the trust effectively.
SB759,96277Section 96. 701.0706 (2) (d) of the statutes is amended to read:
SB759,,278278701.0706 (2) (d) There has been a substantial change of circumstances or removal is requested by all of the qualified beneficiaries, the court finds that the removal of the trustee best serves the interests of all of the beneficiaries and is not inconsistent with a material purpose of the trust, and a suitable cotrustee or successor trustee is available.
SB759,97279Section 97. 701.0707 (2) of the statutes is amended to read:
SB759,,280280701.0707 (2) A trustee who has resigned or been removed shall proceed expeditiously within a reasonable time to deliver the trust property within the trustee’s possession to the cotrustee, successor trustee, or other person entitled to it, subject to the right of the trustee to retain a reasonable reserve for the payment of debts, expenses, and taxes.
SB759,98281Section 98. 701.0802 (5) of the statutes is renumbered 701.0802 (5) (a).
SB759,99282Section 99. 701.0802 (5) (b) of the statutes is created to read:
SB759,,283283701.0802 (5) (b) A trust company acting in any fiduciary capacity with respect to a trust may purchase any service or product, including insurance or securities underwritten or otherwise distributed by the trust company or by an affiliate, through or directly from the trust company or an affiliate of a syndicate or selling group that includes the trust company of an affiliate, provided the purchase otherwise complies with the prudent investor rule in s. 881.01 and with s. 881.015. Compensation for the service or product must be reasonable and not prohibited by the instrument governing the fiduciary relationship. The compensation for the service or product may be in addition to the compensation that the trust company is otherwise entitled to receive.