Document Type
Article
Publication Title
University of Richmond Law Review
Publication Date
2005
Abstract
In its 2005 session the Virginia General Assembly enacted Senate Bill No. 891, thus adopting the Uniform Trust Code (UTC), with modifications considered appropriate to this state's institutions, traditions and jurisprudence. The Virginia Uniform Trust Code (Virginia UTC), set forth in new Chapter 31 of Title 55 of the Code, has an effective date of July 1, 2006, but, once in effect, will be applicable (with some exceptions) to trusts created before, on, or after that date.
The new Virginia UTC, which encompasses the great bulk of the principles and rules that comprise the law of trusts in Virginia, has great relevance and importance to lawyers who specialize in estate planning and to lawyers who represent trustees or trust beneficiaries. It also affects lawyers whose clients, as third parties, have transactional relationships with trustees. The legislation will also affect institutional fiduciaries, accountants, and other non-lawyer professionals whose activities involve administering trusts or advising settlors, trustees, and trust beneficiaries. This article is directed to all of those audiences, with the goal of informing them about the principal features of the legislation and its implications for their practices. In doing so the article will identify most of the relatively small number of differences between the Virginia version and the official text of the UTC as adopted by the National Conference of Commissioners on Uniform State Laws (NCCUSL).
The article is organized as follows. Part II of the article begins with a summary of the reasons for adopting the UTC, both generally and in Virginia in particular. Part II then provides an overview of the development of the UTC leading up to its adoption by NCCUSL in 2000. Part II then describes the process leading to enactment of the UTC by the Virginia General Assembly. Part II also discusses the role of the official NCCUSL Comments in understanding and interpreting the Virginia statute.
Part III of the article provides an overview of the statute. It begins by describing the scope of the Virginia UTC, which applies exclusively to express trusts or trusts required to be administered as express trusts. Part III then describes the manner in which the statute implements the principle of effecting the express intent of the settlor; Part III also describes the few instances in which the terms of a trust instrument cannot override the rules set forth in the statute. Part III further describes the extent to which the common law and principles of equity will continue to govern certain matters concerning the administration of trusts. Part III then describes the function of each of the principal subdivisions of the statute and explains the principal ways in which the Virginia statute varies from the original.
Part IV provides a detailed discussion of several key concepts utilized in the UTC, specifically the concepts of knowledge, qualified beneficiaries, and representation, each of which plays a significant role in resolving matters of trust administration. This discussion is followed by Part V, in which the article examines the numerous ways in which the statute facilitates trust administration without judicial intervention.
In Part VI, the article examines several key substantive elements of the statute, including the rules concerning judicial modification of trusts, rules governing the liability of trustees, and rules governing the rights of creditors of trust beneficiaries.
Part VII of the article offers some concluding remarks.
Recommended Citation
Robert T. Danforth, The Virginia Uniform Trust Code, 40 U. Rich. L. Rev. 325 (2005).
Comments
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