SENATE BILL NO. 289
AN ACT TO AMEND TITLE 12 OF THE DELAWARE CODE RELATING TO WILLS AND TRUSTS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE :
Section 1. Amend Title 12, § 901 of the Delaware Code by deleting subsection (b) thereof and substituting in lieu thereof the following:
“(b) In determining the elective share under subsection (a) of this section or in the case of the death of a married person not domiciled in this State, the right, if any, of the surviving spouse to take an elective share in real or tangible personal property shall be governed by the law of the situs of such property.”
Section 2. Amend Title 12, § 3528 of the Delaware Code by deleting subsection (a) thereof and substituting in lieu thereof the following:
“(a) Unless the terms of the instrument expressly provide otherwise, a trustee who has authority, under the terms of a testamentary instrument or irrevocable inter vivos trust agreement, to invade the principal of a trust (the “first trust”) to make distributions to, or for the benefit of, 1 or more proper objects of the exercise of the power, may instead exercise such authority by appointing all or part of the principal subject to the power in favor of a trustee of a trust (the “second trust”) under an instrument other than that under which the power to invade is created or under the same instrument, provided, however, that, except as otherwise provided in this subsection (a): (i) the exercise of such authority is in favor of a second trust having only beneficiaries who are proper objects of the exercise of the power; and (ii) in the case of any trust contributions to which have been treated as gifts qualifying for the exclusion from gift tax described in § 2503(b) of the Internal Revenue Code of 1986 [26 U.S.C. § 2503(b)], the governing instrument for the second trust shall provide that the beneficiary’s remainder interest shall vest and become distributable no later than the date upon which such interest would have vested and become distributable under the terms of the governing instrument for the first trust. Notwithstanding the foregoing provisions of this subsection (a), the governing instrument for the second trust may provide that, at a time or upon an event specified in the governing instrument, the remaining trust assets shall thereafter be held for the benefit of the beneficiaries of the first trust upon terms and conditions concerning the nature and extent of each such beneficiary’s interest that are substantially identical to the first trust’s terms and conditions concerning such beneficial interests.”
Section 3. Amend Title 12, § 3545 of the Delaware Code by designating the existing section as subsection (a) and by inserting immediately thereafter the following new subsection (b):
“(b) A trust created by a writing shall not be void merely because of the application of subsection (a) if such writing was validly executed in compliance with the law, at the time of execution, of the place which serves as the initial place of administration of the trust, or, if the trust is not yet actively administered, the initial situs of the trust.”
Section 4. Section 1 of this Act shall be effective for the estates of decedents dying after the date of enactment. Sections 2 and 3 of this Act shall be effective on the date of enactment and shall apply to trusts whenever created.
Approved June 24, 2004