National Conference of Commissioners on Uniform State Laws

211 E. Ontario St., Suite 1300, Chicago, IL 60611
tel 312-915-0195, fax 312-915-0187

For Immediate Release

AARP ENDORSES UNIFORM TRUST CODE

May 1, 2002 – The Uniform Trust Code, the first comprehensive attempt at the national level to codify the law of trusts, has recently been endorsed by AARP.

The Policy Book: AARP Public Policies 2002 states:

"A person forms a trust when he or she transfers property to another person ‘in trust' for beneficiaries or for a legally acknowledged beneficial purpose. Trusts are commonly used as part of an individual's estate plan, in the event of incapacity, to avoid probate and in some instances to obtain favorable tax consequences. While their use has been increasing, state laws vary considerably and their varying requirements may present problems for people who move to another state upon retirement. In 2000 the National Conference of Commissioners on Uniform State Laws adopted a uniform trust code to help improve certainty and predictability of interpretation by the courts and to reduce trust preparation costs for consumers.

States should enact laws that: ... codify, simplify and clarify trust laws by modeling them on the Uniform Trust Code promulgated by the National Conference of Commissioners on Uniform State Laws."

There are several reasons why a Uniform Trust Code is needed. The greater use of trusts in recent years, both in family estate planning and in commercial transactions, and the consequent rise in the number of day-to-day questions involving trusts, has led to a recognition that the trust law in many states is thin. While there are numerous Uniform Acts related to trusts, such as the Uniform Prudent Investor Act, the Uniform Principal and Income Act, the Uniform Trustees' Powers Act, the Uniform Custodial Trust Act, and parts of the Uniform Probate Code, none is comprehensive. The Uniform Trust Code will provide states with precise guidance on trust law questions, providing the basis for an efficient system that is fair to both trustees and beneficiaries.

Except as otherwise provided in the terms of the trust, this Code governs the duties and powers of a trustee, relations among trustees, and the rights and interests of beneficiaries. The UTC also has important provisions on revocable trusts, which have become the most popular will substitutes in the United States.

The Uniform Trust Code has been introduced in 10 states since it was approved in August 2000: Connecticut, District of Columbia, Kansas, Minnesota, Nebraska, New Mexico, Oklahoma, Tennessee, Utah, and West Virginia. It is being studied by bar associations and legislative committees in more than 30 states.

The National Conference of Commissioners on Uniform State Laws is now in its 111th year. The organization comprises more than 300 lawyers, judges, and law professors, appointed by the states as well as the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, to draft proposals for uniform and model laws and work toward their enactment in their legislatures. Since its inception in 1892, the group has promulgated more than 200 acts, among them such bulwarks of state statutory law as the Uniform Commercial Code, the Uniform Probate Code, and the Uniform Partnership Act.

For further information, please contact Michelle Clayton, John McCabe, or Katie Robinson at 312-915-0195, or Gabrielle Bamberger at 212-333-5222. Further information on the UTC can be found at NCCUSL's website at www.nccusl.org.