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A BILL TO BE ENTITLED
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AN ACT
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relating to noncharitable trusts without an ascertainable |
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beneficiary. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 111.004(4), Property Code, is amended to |
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read as follows: |
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(4) "Express trust" means a fiduciary relationship |
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with respect to property which arises as a manifestation by the |
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settlor of an intention to create the relationship and which |
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subjects the person holding title to the property to equitable |
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duties to deal with the property: |
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(A) for the benefit of another person; or |
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(B) for a particular purpose, in the case of a |
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trust subject to Subchapter F. |
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SECTION 2. Chapter 112, Property Code, is amended by adding |
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Subchapter F to read as follows: |
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SUBCHAPTER F. NONCHARITABLE TRUST WITHOUT ASCERTAINABLE |
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BENEFICIARY |
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Sec. 112.121. VALIDITY OF TRUST; APPLICABILITY. (a) A |
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trust may be created for a noncharitable purpose without a definite |
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or definitely ascertainable beneficiary. A noncharitable purpose |
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may include seeking economic or noneconomic benefits. |
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(b) This subchapter does not apply to a trust created under |
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Section 112.037. |
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Sec. 112.122. ENFORCEMENT OF TRUST. (a) A trust created |
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under this subchapter must be enforced by one or more persons |
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appointed in the terms of the trust to serve as a trust enforcer. |
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(b) A trust enforcer shall enforce the purpose and terms of |
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the trust. The trust enforcer is not a beneficiary of the trust, |
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but has the rights of a beneficiary provided under this title and |
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the common law of this state, or as otherwise provided by the terms |
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of the trust. |
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(c) A trust enforcer shall exercise any authority granted |
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under the terms of the trust or the provisions of this section as a |
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fiduciary owing a duty to the trust and is entitled to reasonable |
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compensation for serving as trust enforcer. |
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(d) A trust enforcer may consent to, waive, object to, or |
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petition an appropriate court concerning any matter regarding the |
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purpose or administration of the trust. |
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(e) Except as otherwise provided by the terms of the trust, |
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if more than one person is acting as a trust enforcer, any action in |
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that capacity must be decided by the majority vote of the persons |
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acting as trust enforcers. If there are an even number of trust |
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enforcers and a majority vote cannot be established, the decision |
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of the trustee controls. |
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(f) The terms of the trust may provide for the succession of |
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a trust enforcer or a process of appointing any successor trust |
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enforcer. |
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(g) If no person is serving as a trust enforcer for a trust |
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created under this subchapter, a court properly exercising |
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jurisdiction shall appoint one or more persons to serve as the trust |
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enforcer. |
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Sec. 112.123. APPLICATION OR DISTRIBUTION OF TRUST |
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PROPERTY. (a) Property of a trust created under this subchapter |
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may be applied only to the intended purpose of the trust, except to |
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the extent that a court finds that the value of the trust property |
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exceeds the amount required for the intended purpose of the trust. |
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(b) Except as provided by the terms of the trust, property |
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found by a court not to be required for the trust's intended purpose |
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shall be distributed: |
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(1) as provided by the terms of the trust; or |
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(2) if the trust does not provide for the distribution |
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of such property, to the settlor if then living or to the settlor's |
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successors in interest. |
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SECTION 3. Subchapter F, Chapter 112, Property Code, as |
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added by this Act, applies only to a trust created on or after the |
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effective date of this Act. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2023. |