On January 1, 2005, the Missouri Uniform Trust Code became effective. The new law applies to all trusts created before, on, or after January 1, 2005,” with some exceptions for acts done and trusts which were irrevocable prior to January 1, 2005.
For the most part, the Code is merely a codification of existing law, which has developed over several hundred years, first in England and then in the United States, primarily through court decisions. There are, however, some new concepts designed to fill gaps in the existing law and to allow easier administration of trusts. For example:
- An irrevocable trust may be modified, or even terminated, without court approval, if the settlor of the trust and all beneficiaries consent.
- The trustee of an irrevocable trust must provide financial information to beneficiaries of the trust, and this requirement cannot be overridden by the trust instrument.
- An irrevocable trust may be modified to achieve the settlor’s tax objectives, if the modification is “not contrary to the settlor’s probable intention,” or to correct a mistake based upon a misunderstanding of fact or of law.
- The time periods for objecting to actions of the trustee or for contesting a trust have been shortened substantially, but the law requires certain actions be taken to inform beneficiaries so that they have an opportunity to act.
With fourteen defined exceptions, the provisions of the law are defaults, that is, the law only applies if the trust agreement does not provide otherwise.
The provisions of the Missouri Uniform Trust Code will require a rethinking of the manner in which trusts are drafted, and may require amendment of existing trusts to carry forward the goals and desires of the settlor. We will be pleased to consult with you regarding your trust, questions you may have and the impact of the Code.