(UTC 111) (a) For purposes of this section, "interested persons" means persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the court.

(b) Except as otherwise provided in subsection (c) of this section, interested persons may enter into a binding nonjudicial settlement agreement with respect to any matter involving a trust.

(c) A nonjudicial settlement agreement is valid only to the extent it does not violate a material purpose of the trust and includes terms and conditions that could be properly approved by the court under the Nebraska Uniform Trust Code or other applicable law. A spendthrift provision in the terms of the trust is presumed to constitute a material purpose of the trust.

(3) direction to a trustee to refrain from performing a particular act or the grant to a trustee of any necessary or desirable power;

(4) the resignation or appointment of a trustee and the determination of a trustee's compensation;

(e) Any interested person may request the court to approve a nonjudicial settlement agreement, to determine whether the representation as provided in sections 30-3822 to 30-3826 was adequate, and to determine whether the agreement contains terms and conditions the court could have properly approved.

Annotations

A nonjudicial settlement agreement is valid only to the extent it does not violate a material purpose of the trust. A spendthrift provision in the terms of the trust is presumed to constitute a material purpose of the trust. In re Trust Created by McGregor, 308 Neb. 405, 954 N.W.2d 612 (2021).
Changes made to an irrevocable trust by a nonjudicial settlement agreement between the surviving spouse and her two children, which provided for distribution of the trust's assets upon the spouse's death free of trust, violated a "material purpose" of the trust established by its spendthrift provisions, and thus made the agreement invalid. In re Trust Created by McGregor, 308 Neb. 405, 954 N.W.2d 612 (2021).
If the continuance of a trust is necessary to carry out a material purpose of the trust, the beneficiaries cannot compel its termination. In re Trust Created by McGregor, 308 Neb. 405, 954 N.W.2d 612 (2021).
The material purposes of a trust are subject to the settlor's discretion, to the extent that its purposes are lawful, are not contrary to public policy, are possible to achieve, and are for the benefit of its beneficiaries. In re Trust Created by McGregor, 308 Neb. 405, 954 N.W.2d 612 (2021).

(UTC 112) The rules of construction that apply in this state to the interpretation and disposition of property by will shall also apply as appropriate to the interpretation of the terms of a trust and the disposition of the trust property.

(UTC 201) (a) The court may intervene in the administration of a trust to the extent its jurisdiction is invoked by an interested person or as provided by law.

(b) A trust is not subject to continuing judicial supervision unless ordered by the court.

(c) A judicial proceeding involving a trust may relate to any matter involving the trust's administration, including a request for instructions and an action to declare rights.

Annotations

A beneficiary of property left to a trust has standing to raise the trustee's self-dealing and to seek damages, an accounting, and a constructive trust. In re Estate of Hedke, 278 Neb. 727, 775 N.W.2d 13 (2009).
A trust beneficiary's estate can seek to enforce the beneficiary's interests in the trust to the same extent that the beneficiary could have enforced his or her interests immediately before death, consistent with the standard provided in the Restatement (Third) of Trusts section 50, comment d(5). (2003). In re Trust Created by Hansen, 274 Neb. 199, 739 N.W.2d 170 (2007).
The remainder beneficiaries' motion for a declaration of rights was construed as a request for the court to instruct the trustee on its duties and powers when they asked the county court to decide whether the trustee could pay the billings for the beneficiary's last-illness expenses and, if so, what standards should be applied. In re Trust Created by Hansen, 274 Neb. 199, 739 N.W.2d 170 (2007).
This section does not limit to trustees the right to seek instructions from the court. In re Trust Created by Hansen, 274 Neb. 199, 739 N.W.2d 170 (2007).

(UTC 202) (a) By accepting the trusteeship of a trust having its principal place of administration in this state or by moving the principal place of administration to this state, the trustee submits personally to the jurisdiction of the courts of this state regarding any matter involving the trust.

(b) With respect to their interests in the trust, the beneficiaries of a trust having its principal place of administration in this state are subject to the jurisdiction of the courts of this state regarding any matter involving the trust. By accepting a distribution from such a trust, the recipient submits personally to the jurisdiction of the courts of this state regarding any matter involving the trust.

(c) This section does not preclude other methods of obtaining jurisdiction over a trustee, beneficiary, or other person receiving property from the trust.

(a) To the full extent permitted by the Constitution of Nebraska, the county court has jurisdiction over all subject matter relating to trusts.

(b) The county court has full power to make orders, judgments, and decrees and take all other action necessary and proper to administer justice in the matters which come before it.

(d) Petitions for formal orders of the court may combine various requests for relief in a single proceeding if the orders sought may be finally granted without delay. Except as required for proceedings which are particularly described by other sections of the Nebraska Uniform Trust Code, no petition is defective because it fails to embrace all matters which might then be the subject of a final order.

(e) A proceeding for appointment of a trustee is concluded by an order making or declining the appointment.

(f) For purposes of this section, "proceeding" includes action at law and suit in equity.

Annotations

A proceeding initiated under this section and section 30-3862 to remove a trustee is a special proceeding within the meaning of section 25-1902. In re Trust of Rosenberg, 269 Neb. 310, 693 N.W.2d 500 (2005).

(UTC 204) (a) Except as otherwise provided in subsections (b) and (c) of this section, venue for a judicial proceeding involving a trust is in the county of this state in which the trust's principal place of administration is or will be located and, if the trust is created by will and the estate is not yet closed, in the county in which the decedent's estate is being administered.

(b) Except as provided in subsection (c) of this section, if a trust has no trustee, venue for a judicial proceeding for the appointment of a trustee is in a county of this state in which a beneficiary resides, in a county in which any trust property is located, in a county in which the trust's principal place of administration was located before a vacancy in the office of trustee occurred, and if the trust is created by will, in the county in which the decedent's estate was or is being administered.

(c) If a trust is registered in Nebraska, unless the registration has been released, the venue is in the court in which the trust is registered, even if there is no trustee.

(d)(i) Where a proceeding under the Nebraska Uniform Trust Code could be maintained in more than one place in this state, the court in which the proceeding is first commenced has the exclusive right to proceed.

(ii) If proceedings concerning the same trust are commenced in more than one court of this state, the court in which the proceeding was first commenced shall continue to hear the matter, and the other courts shall hold the matter in abeyance until the question of venue is decided, and if the ruling court determines that venue is properly in another court, it shall transfer the proceeding to the other court.

(iii) If a court finds that in the interest of justice a proceeding or a file should be located in another court of this state, the court making the finding may transfer the proceeding or file to the other court.

Annotations

In a declaratory judgment action concerning the inheritance tax consequences of a girlfriend's rights to the settlor's house that he devised to her, the trial court did not abuse its discretion in transferring venue from the county where the house was located to the county where the trust was registered. In re Hessler Living Trust, 316 Neb. 600, 5 N.W.3d 723 (2024).

(1) The trustee of a trust having its principal place of administration in this state may register the trust in the county court of this state at the principal place of administration. Unless otherwise designated in the trust instrument, the principal place of administration of a trust is the trustee's usual place of business where the records pertaining to the trust are kept, or at the trustee's residence if he or she has no such place of business.

(2) In the case of cotrustees, the principal place of administration, if not otherwise designated in the trust instrument, is (a) the usual place of business of the corporate trustee if there is one corporate cotrustee, (b) the usual place of business or residence of the individual trustee who is a professional fiduciary if there is one such person and no corporate cotrustee, and (c) the usual place of business or residence of any of the cotrustees as agreed upon by such cotrustees.

(3) If there is more than one trustee, any trustee may register the trust in the county in which the principal place of administration is located under subsection (2). If the principal place of administration is determined under subdivision (2)(c) and the cotrustees cannot agree on the principal place of administration, a proceeding may be filed under section 30-3812 by any interested person to determine the principal place of administration.

(4) The right to register under sections 30-3816 to 30-3820 does not apply to the trustee of a trust if registration would be inconsistent with the retained jurisdiction of a foreign court from which the trustee cannot obtain release.

(5) No one other than a trustee shall register a trust. Registration of a trust is not required in order for a court to exercise jurisdiction over a trust, a trustee, or the beneficiaries.

Annotations

When a person has been removed as trustee of a trust, that person no longer has standing under this section to register the trust in Nebraska. In re Trust Created by Del Castillo, 268 Neb. 671, 686 N.W.2d 900 (2004).
Where principal place of administration of testamentary trust was in Iowa, trust could not have been registered in Nebraska under this section. Raynor v. Northwestern National Bank, 211 Neb. 119, 317 N.W.2d 786 (1982).

Registration shall be accomplished by filing a statement indicating the name and address of the trustee in which it acknowledges the trusteeship. The statement shall indicate whether the trust has been registered elsewhere. The statement shall identify the trust: (1) in the case of a testamentary trust, by the name of the testator and the date and place of domiciliary probate; (2) in the case of a written inter vivos trust, by the name of each settlor and the original trustee and the date of the trust instrument; or (3) in the case of an oral trust, by information identifying the settlor or other source of funds and describing the time and manner of the trust's creation and the terms of the trust, including the subject matter, beneficiaries, and time of performance.

The clerk of court shall keep a record for each trust involved in any document which may be filed with the court under sections 30-3816 to 30-3820, including petitions and applications, trust registrations, and of any orders or responses relating thereto by the court, and establish and maintain a system for indexing, filing, or recording which is sufficient to enable users of the records to obtain adequate information. Upon payment of the fees required by law, the clerk must issue certified copies of any record or paper filed or recorded.

(a) By registering a trust, or accepting the trusteeship of a registered trust, the trustee submits personally to the jurisdiction of the court of registration in any proceeding under section 30-3812 relating to the trust that may be initiated by any interested person while the trust remains registered. Notice of any proceeding shall be delivered to the trustee or mailed to him or her by ordinary first-class mail at his or her address as listed in the registration or as thereafter reported to the court and to his or her address as then known to the petitioner.

(b) To the extent of their interests in the trust, all beneficiaries of a trust properly registered in this state are subject to the jurisdiction of the court of registration for the purposes of proceedings under section 30-3812, provided notice is given pursuant to section 30-2220.

Annotations

The act of registering a trust gives the county court jurisdiction over the interests of all notified beneficiaries to decide issues related to any matter involving the trust's administration, including a request for instructions or an action to declare rights. In re Trust Created by Hansen, 274 Neb. 199, 739 N.W.2d 170 (2007).
Under this section, the county court of Dakota County, Nebraska, could not acquire jurisdiction of a trust having principal place of administration in Iowa since the trust could not be registered in Nebraska under section 30-2801. Raynor v. Northwestern National Bank, 211 Neb. 119, 317 N.W.2d 786 (1982).

A foreign corporate trustee is required to qualify as a foreign corporation doing business in this state if it maintains the principal place of administration of any trust within the state. A foreign cotrustee is not required to qualify in this state solely because its cotrustee maintains the principal place of administration in this state. Unless otherwise doing business in this state, local qualification by a foreign trustee, corporate or individual, is not required in order for the trustee to receive distribution from a local estate or to hold, invest in, manage, or acquire property located in this state, or maintain litigation if the laws of the state of incorporation or residence of the foreign trustee grant the same authority to a trustee incorporated or resident in this state. Nothing in this section affects a determination of what other acts require qualification as doing business in this state.

Appellate review under the Nebraska Uniform Trust Code shall be governed by section 30-1601.

(UTC 301) (a) Notice to a person who may represent and bind another person under sections 30-3822 to 30-3826 has the same effect as if notice were given directly to the other person.

(b) The consent of a person who may represent and bind another person under sections 30-3822 to 30-3826 is binding on the person represented unless the person represented objects to the representation before the consent would otherwise have become effective.

(c) Except as otherwise provided in sections 30-3837 and 30-3854, a person who under sections 30-3822 to 30-3826 may represent a settlor who lacks capacity may receive notice and give a binding consent on the settlor's behalf.

(d) A settlor may not represent and bind a beneficiary under sections 30-3822 to 30-3826 with respect to the termination or modification of a trust under subsection (a) of section 30-3837.

(UTC 302) The holder of a power of appointment or other power to terminate an interest may represent and bind persons whose interests, as permissible appointees, takers in default, or otherwise, are subject to the power.

(UTC 303) To the extent there is no conflict of interest between the representative and the person represented or among those being represented with respect to a particular question or dispute:

(1) a conservator may represent and bind the estate that the conservator controls;

(2) a guardian may represent and bind the ward if a conservator of the ward's estate has not been appointed;

(3) an agent having authority to act with respect to the particular question or dispute may represent and bind the principal;

(5) a personal representative of a decedent's estate may represent and bind persons interested in the estate; and

(6) a parent may represent and bind the parent's minor or unborn child if a conservator or guardian for the child has not been appointed.

(UTC 304) Unless otherwise represented, a minor, incapacitated, or unborn individual, or a person whose identity or location is unknown and not reasonably ascertainable, may be represented by and bound by another having a substantially identical interest with respect to the particular question or dispute, but only to the extent there is no conflict of interest between the representative and the person represented.

Annotations

Under section 30-3837(b), the party seeking a modification of a trust must affirmatively demonstrate that all beneficiaries have consented to the modification. The issue of consent for unknown beneficiaries must be resolved pursuant to this section and section 30-3826. In re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).

(UTC 305) (a) If the court determines that an interest is not represented under sections 30-3822 to 30-3826, or that the otherwise available representation might be inadequate, the court may appoint a representative to receive notice, give consent, and otherwise represent, bind, and act on behalf of a minor, incapacitated, or unborn individual, or a person whose identity or location is unknown. A representative may be appointed to represent several persons or interests.

(b) A representative may act on behalf of the individual represented with respect to any matter arising under the Nebraska Uniform Trust Code, whether or not a judicial proceeding concerning the trust is pending.

(c) In making decisions, a representative may consider general benefit accruing to the living members of the individual's family.

Annotations

Under section 30-3837(b), the party seeking a modification of a trust must affirmatively demonstrate that all beneficiaries have consented to the modification. The issue of consent for unknown beneficiaries must be resolved pursuant to section 30-3825 and this section. In re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).

(1) transfer of property to another person as trustee during the settlor's lifetime or by will or other disposition taking effect upon the settlor's death;

(2) except as required by a statute other than the Nebraska Uniform Trust Code, declaration by the owner of property that the owner holds identifiable property as trustee; or

Annotations

Under subsection (1) of this section, a trust may be created in life insurance death benefits. In re Trust of Rosenberg, 273 Neb. 59, 727 N.W.2d 430 (2007).

A contract to make a trust, or not to revoke a trust, if executed on or after January 1, 1977, shall only be established by: (1) Provisions of a will or a trust stating the material provisions of the contract; (2) an express reference in a will or trust to a contract and extrinsic evidence proving the terms of the contract; or (3) a writing signed by the decedent evidencing the contract. The execution of a joint trust does not create a presumption of a contract not to revoke the trust.

A provision in a trust purporting to penalize any interested person for contesting the trust or instituting other proceedings relating to the trust is unenforceable if probable cause exists for instituting proceedings.

(1) the settlor has capacity to create a trust and meets one of the following requirements:

(b) A beneficiary is definite if the beneficiary can be ascertained now or in the future, subject to any applicable rule against perpetuities.

(c) A power in a trustee to select a beneficiary from an indefinite class is valid. If the power is not exercised within a reasonable time, the power fails and the property subject to the power passes to the persons who would have taken the property had the power not been conferred.

Annotations

A beneficiary must be "definite." A class of beneficiaries is not indefinite merely because it consists of a changing or shifting group, the number of whose members may increase or decrease. Typical examples of definite classes for trust beneficiaries are "children" or "grandchildren," the "issue" or "descendants," or the "heirs" or "next of kin" of a designated person. In re William R. Zutavern Revocable Trust, 309 Neb. 542, 961 N.W.2d 807 (2021).
The provision in subsection (b) of this section that a "beneficiary is definite if the beneficiary can be ascertained now or in the future" did not change the common-law rule that the beneficiary must be ascertainable from the trust instrument. Newman v. Liebig, 282 Neb. 609, 810 N.W.2d 408 (2011).

(UTC 403) A trust not created by will is validly created if its creation complies with the law of the jurisdiction in which the trust instrument was executed, or the law of the jurisdiction in which, at the time of creation:

(2) except with respect to Nebraska real estate, (A) a trustee was domiciled or had a place of business; or (B) any trust property was located.

(UTC 404) A trust may be created only to the extent its purposes are lawful, not contrary to public policy, and possible to achieve. A trust and its terms must be for the benefit of its beneficiaries.

(UTC 405) (a) A charitable trust may be created for the relief of poverty, the advancement of education or religion, the promotion of health, governmental or municipal purposes, or other purposes the achievement of which is beneficial to the community.

(b) If the terms of a charitable trust do not indicate a particular charitable purpose or beneficiary, the court may select one or more charitable purposes or beneficiaries. The selection must be consistent with the settlor's intention to the extent it can be ascertained.

(UTC 406) A trust is void to the extent its creation was induced by fraud, duress, or undue influence.

(UTC 407) Except as required by a statute other than the Nebraska Uniform Trust Code, a trust need not be evidenced by a trust instrument, but the creation of an oral trust and its terms, or an amendment or revocation of an oral trust, may be established only by clear and convincing evidence.

(UTC 408) (a) A trust may be created to provide for the care of an animal alive during the settlor's lifetime. The trust terminates upon the death of the animal or, if the trust was created to provide for the care of more than one animal alive during the settlor's lifetime, upon the death of the last surviving animal.

(b) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court. A person having an interest in the welfare of the animal may request the court to appoint a person to enforce the trust or to remove a person appointed.

(c) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use must be distributed to the settlor, if then living, otherwise to the settlor's successors in interest.

(UTC 409) Except as otherwise provided in section 30-3834 or Chapter 12, article 5, or by another statute, the following rules apply:

(1) A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficiary or for a noncharitable but otherwise valid purpose to be selected by the trustee. The trust may not be enforced for more than twenty-one years.

(2) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court.

(3) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use must be distributed to the settlor, if then living, otherwise to the settlor's successors in interest.

(UTC 410) (a) In addition to the methods of termination prescribed by sections 30-3837 to 30-3840, a trust terminates to the extent the trust is revoked or expires pursuant to its terms, no purpose of the trust remains to be achieved, or the purposes of the trust have become unlawful, contrary to public policy, or impossible to achieve.

(b) A proceeding to approve or disapprove a proposed modification or termination under sections 30-3837 to 30-3842, or trust combination or division under section 30-3843, may be commenced by a trustee or beneficiary. The settlor of a charitable trust may maintain a proceeding to modify the trust under section 30-3839.

Annotations

When a trust does not contain a termination clause, its termination date is implied from its terms. In re Estate of Hedke, 278 Neb. 727, 775 N.W.2d 13 (2009).
Where a trust did not contain a termination clause, the trust impliedly terminated with the settlor's death, because the settlor's beneficial interests in the trust ended upon her death when providing for her care and support was the only purpose for the trust. The trustee's payments for a settlor's outstanding debts, taxes, and expenses upon the settlor's death are part of the trustee's winding-up duties after a trust terminates. In re Estate of Hedke, 278 Neb. 727, 775 N.W.2d 13 (2009).
A trust may expire or terminate by its own terms, thereby triggering the period for winding up the trust; the winding-up period continues to exist until the trust is fully terminated by distribution of the trust property. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
If a trustee knows or should know of circumstances that justify judicial action to modify an administrative or distributive provision of a trust because of circumstances not anticipated by the settlor, the trustee has a duty to petition the court for appropriate modification of, or deviation from, the terms of the trust. The possible imposition of such a duty on a trustee further supports permitting a trustee to seek modification under section 30-3838 even in those instances where a trust may have terminated or expired by its own terms, but the winding up and distribution of trust property is still pending. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
If the trustees fail to distribute the property once the purpose of the trust was fulfilled, a court can enter an order fully terminating the trust with directions to distribute the trust property in accordance with the terms of the trust or, if appropriate, enter an order modifying (or reforming) the trust terms. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
Regardless of how a trust may terminate, subsection (b) of this section authorizes a trustee or beneficiary to commence a proceeding to approve or disapprove a proposed modification or termination under sections 30-3837 to 30-3842. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
The Nebraska Uniform Trust Code allows a beneficiary or trustee to petition a county court to consider modification or termination of a trust which has expired or terminated pursuant to its own terms but remains in the winding-up period, including the possible modification of, or deviation from, dispositive terms. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
The Nebraska Uniform Trust Code provides statutory options for a trustee to seek a modification of the trust during the winding-up period following the expiration or termination of a trust by its own terms. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).

(UTC 411) (a) If, upon petition, the court finds that the settlor and all beneficiaries consent to the modification or termination of a noncharitable irrevocable trust, the court shall approve the modification or termination even if the modification or termination is inconsistent with a material purpose of the trust. A settlor's power to consent to a trust's modification or termination may be exercised by an agent under a power of attorney only to the extent expressly authorized by the power of attorney or the terms of the trust; by the settlor's conservator with the approval of the court supervising the conservatorship if an agent is not so authorized; or by the settlor's guardian with the approval of the court supervising the guardianship if an agent is not so authorized and a conservator has not been appointed.

(b) A noncharitable irrevocable trust may be terminated upon consent of all of the beneficiaries if the court concludes that continuance of the trust is not necessary to achieve any material purpose of the trust. A noncharitable irrevocable trust may be modified upon consent of all of the beneficiaries if the court concludes that modification is not inconsistent with a material purpose of the trust.

(d) Upon termination of a trust under subsection (a) or (b) of this section, the trustee shall distribute the trust property as agreed by the beneficiaries.

(e) If not all of the beneficiaries consent to a proposed modification or termination of the trust under subsection (a) or (b) of this section, the modification or termination may be approved by the court if the court is satisfied that:

(1) if all of the beneficiaries had consented, the trust could have been modified or terminated under this section; and

(2) the interests of a beneficiary who does not consent will be adequately protected.

Annotations

Under subsection (b) of this section, the party seeking a modification of a trust must affirmatively demonstrate that all beneficiaries have consented to the modification. The issue of consent for unknown beneficiaries must be resolved pursuant to sections 30-3825 and 30-3826. In re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).
Under subsection (e) of this section, there must be a showing that the interests of nonconsenting beneficiaries will be adequately protected by a modification. For the interests of nonconsenting beneficiaries to be adequately protected, the court must determine that modification will not affect those interests and impose safeguards to prevent them from being affected, when deemed necessary. In re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).
Although subsection (e) of this section authorizes a court to modify a trust without the consent of all beneficiaries, it can only do so if the modification is not inconsistent with a material purpose of the trust and any nonconsenting beneficiary would be adequately protected. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
While this section refers to a noncharitable irrevocable trust, and the trusts at issue here were revocable when made, this section's application is nevertheless appropriate because of the death of the last surviving grantor/settlor. A trust which is revocable when made remains revocable during the settlor's lifetime; however, a revocable trust necessarily becomes irrevocable upon the settlor's death. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).

(UTC 412) (a) The court may modify the administrative or dispositive terms of a trust or terminate the trust if, because of circumstances not anticipated by the settlor, modification or termination will further the purposes of the trust. To the extent practicable, the modification must be made in accordance with the settlor's probable intention.

(b) The court may modify the administrative terms of a trust if continuation of the trust on its existing terms would be impracticable or wasteful or impair the trust's administration.

(c) Upon termination of a trust under this section, the trustee shall distribute the trust property in a manner consistent with the purposes of the trust.

Annotations

If a trustee knows or should know of circumstances that justify judicial action to modify an administrative or distributive provision of a trust because of circumstances not anticipated by the settlor, the trustee has a duty to petition the court for appropriate modification of, or deviation from, the terms of the trust. The possible imposition of such a duty on a trustee further supports permitting a trustee to seek modification under this section even in those instances where a trust may have terminated or expired by its own terms, but the winding up and distribution of trust property is still pending. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).
This section broadens the court's ability to apply equitable deviation to modify a trust. The application of equitable deviation allows a court to modify the dispositive provisions of a trust, as well as its administrative terms. The purpose of equitable deviation is not to disregard the settlor's intent but to modify inopportune details to effectuate better the settlor's broader purpose. In re Trust Created by Augustin, 27 Neb. App. 593, 935 N.W.2d 493 (2019).

(UTC 413) (a) Except as otherwise provided in subsection (b) of this section, if a particular charitable purpose becomes unlawful, impracticable, impossible to achieve, or wasteful:

(2) the trust property does not revert to the settlor or the settlor's successors in interest; and

(3) the court may apply cy pres to modify or terminate the trust by directing that the trust property be applied or distributed, in whole or in part, in a manner consistent with the settlor's charitable purposes or to the Legal Aid and Services Fund.

(b) Subsection (a) of this section does not apply if the document creating the charitable interest expressly provides for an alternate disposition of the charitable interest in the event the charitable purpose becomes unlawful, impracticable, impossible to achieve, or wasteful. A general residuary disposition by trust shall not be considered an express provision for an alternate disposition.

(c) This section shall not be deemed to limit application of the common law doctrines of cy pres and deviation or section 58-615.

(UTC 414) (a) After notice to the qualified beneficiaries, the trustee of a trust consisting of trust property having a total value less than one hundred thousand dollars may terminate the trust if the trustee concludes that the value of the trust property is insufficient to justify the cost of administration.

(b) The court may modify or terminate a trust or remove the trustee and appoint a different trustee if it determines that the value of the trust property is insufficient to justify the cost of administration.

(c) Upon termination of a trust under this section, the trustee shall distribute the trust property in a manner consistent with the purposes of the trust.

(d) This section does not apply to an easement for conservation or preservation.

(UTC 415) The court may reform the terms of a trust, even if unambiguous, to conform the terms to the settlor's intention if it is proved by clear and convincing evidence that both the settlor's intent and the terms of the trust were affected by a mistake of fact or law, whether in expression or inducement.

Annotations

A document by which a settlor purports to revoke a revocable trust is a term of that trust. In re Trust Created by Isvik, 274 Neb. 525, 741 N.W.2d 638 (2007).
Absent clear and convincing evidence that a settlor's stated intent to revoke her trust was a product of mistake, the trust was revoked and ceased to exist. In re Trust Created by Isvik, 274 Neb. 525, 741 N.W.2d 638 (2007).
A document by which a settlor purports to revoke a revocable trust is a term of that trust within the meaning of this section. In re Trust of O'Donnell, 19 Neb. App. 696, 815 N.W.2d 640 (2012).

(UTC 416) To achieve the settlor's tax objectives, the court may modify the terms of a trust in a manner that is not contrary to the settlor's probable intention. The court may provide that the modification has retroactive effect.

(UTC 417) After notice to the qualified beneficiaries, a trustee may combine two or more trusts into a single trust or divide a trust into two or more separate trusts, if the result does not impair rights of any beneficiary or adversely affect achievement of the purposes of the trust.