Bill Summary for S 407 (2011-2012)

Summary date: 

Mar 23 2011

Bill Information:

View NCGA Bill Details2011-2012 Session
Senate Bill 407 (Public) Filed Wednesday, March 23, 2011
TO AMEND THE LAWS GOVERNING TRUSTS, ESTATE PLANNING, AND TRUST COMPANIES.
Intro. by Hartsell.

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Bill summary

Makes an organizational change to GS 32-55, which provides for notice under the Uniform Fiduciaries Act. Enacts new subsection (c) to GS 36C-5-505, which pertains to a creditor’s claim against a settlor, to provide that, subject to the Uniform Fraudulent Transfer Act, trust property will be deemed to have been contributed by the settlor’s spouse after the death of the settlor’s spouse, if the settlor is a beneficiary of any of the four listed trusts after the death of the settlor’s spouse. Amends GS 36C-7-704(f) to clarify that a successor trustee will be vested with the title to property of the former trustee. Amends GS 36C-8-816(26), clarifying a specific power of the trustee, to provide that the trustee may exercise all powers otherwise exercisable during the administration of the trust, upon termination of the trust. Amends GS 28A-8-1(b), clarifying that a bond is not required from a personal representative that is a licensed trust institution. Amends GS 53-43(6), one of the listed general powers of banks, to clarify that a bank may maintain separate departments and deposit all uninvested fiduciary funds in its commercial department, as specified, by segregating and delivering to the trust department such securities as required by GS 53-163.1 (funds held by a corporation exercising fiduciary powers) for such deposits.
Rewrites the title of Article 14 of GS Chapter 53 to read Trust Institutions Acting in a Fiduciary Capacity; makes a conforming change throughout the article to replace bank with trust institution and replace clearing corporation with securities intermediary. Enacts new GS 53-158.10 to add definitions for depository institution, hazardous condition, and trust institution, applicable to the article. Amends GS 53-161, to allow the Commissioner of Banks (Commissioner) to examine any trust institution that applies for or is licensed by the Commissioner. Allows the Commissioner to refuse to issue a license to a trust institution in a hazardous condition. Deletes GS 53-162 (certificate of solvency). Amends GS 53-163.5(b), which concerns common trust funds, to provide that a maintaining institution is considered to be affiliated with a participating institution if the former is controlled by, or is under common control with the latter, as determined under federal law or by the Commissioner. Makes other conforming and clarifying changes.
Amends GS 53-301(a), adding definitions for board of directors and director, applicable to trust companies and interstate trust business. Amends GS 53-315 (establishing an interstate trust office) and 53-316 (acquiring an interstate trust office) to delete conditional language placed on trust offices. Makes clarifying changes to GS 53-331(a) and 53-335(b). Amends GS 53-332, authorizing the Commissioner to allow a state trust company to organize as a company other than a corporation; makes a conforming change. Amends GS 53-352(a), deleting language allowing shareholders to authorize additional directorships. Amends GS 53-363(b), which concerns private trust companies, to add that the holders of the equity securities of a private trust company may by unanimous agreement limit or alter the board of directors’ authority, as specified. Includes notification requirement to the Commissioner. Makes a conforming change to GS 53-363(c).
Makes other conforming and clarifying changes. Applies to all trusts created before, on, or after October 1, 2011.

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