New Hampshire Revised Statutes 564-B:4-406 – Validity of Trusts
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(a) A trust is void to the extent that it was not validly created in accordance with this chapter or its creation was induced by fraud, duress, or undue influence.
(b) A person may commence a judicial proceeding to contest the validity of a trust within the earlier of:
(1) in the case of a trust that was revocable at the settlor’s death, 3 years after the settlor’s death;
(2) in the case of an irrevocable trust, including a formerly revocable trust that has become irrevocable, 3 years after the trustee sent to the beneficiary a notice described in N.H. Rev. Stat. § 564-B:8-813(c)(3); or
(3) in the case of an irrevocable trust, including a trust that was revocable at the settlor’s death or a formerly revocable trust that has become irrevocable, 180 days after the trustee sent the person a copy of the trust instrument and a notice informing the person of the trust’s existence, the trustee’s name, address, and telephone number, and the time allowed for commencing a proceeding to contest the validity of a trust.
(c) A trustee may send the notice described in subsection (b)(3) for purposes of commencing the 180-day limitation period, but the trustee does not have a duty to do so. A trustee shall not be liable to any person for not sending the notice described in subsection (b)(3).
(d) During his or her life, a settlor may commence a judicial proceeding to determine the validity of a trust that he or she created, subject only to the trust’s subsequent amendment or revocation if the trust is revocable.
(1) The trust instrument must expressly provide that this state‘s laws govern the trust’s validity, interpretation, and administration, and the trust must have its principal place of administration within this state.
(2) The venue for the judicial proceeding is in the county where the trust has its principal place of administration.
(3) In addition to the settlor, each of the following persons is an interested person in the judicial proceeding:
(A) the settlor’s spouse;
(B) the persons who, if the settlor had died on the date of filing the petition, would be the settlor’s heirs;
(C) the qualified beneficiaries;
(D) the trustees, trust advisors, and trust protectors;
(E) if the trust is wholly or partially a charitable trust, the director of charitable trusts;
(F) if the trust is a trust for the care of an animal under N.H. Rev. Stat. § 564-B:4-408, the persons who, under the terms of the trust, have the power to enforce the trust;
(G) if the trust is a trust authorized under N.H. Rev. Stat. § 564-B:4-409, the persons who, under the terms of the trust, have the power to enforce the trust; and
(H) any other persons who would be an interested person in a judicial proceeding to determine the validity of the trust.
(4) In the case of a revocable trust, the qualified beneficiaries and other interested persons shall be determined as if the trust was irrevocable on the date of filing the petition, and each of the qualified beneficiaries and other interested persons shall be deemed possessed of inchoate property rights.
(5) Notice shall be given to each of the interested persons. The court may order notice be given to other persons.
(6) After a hearing, the court shall declare whether the trust is valid or invalid, and it may make other findings of fact and conclusions of law that are appropriate under the circumstances.
(7) A trust for which there is a declaration of validity under this subsection may be modified or revoked in the same manner as a trust for which there is no declaration of validity under this subsection.
(8) A settlor’s failure to commence a judicial proceeding under this subsection shall not be construed as evidence or as an admission that the trust is invalid for any reason.
(e) A trustee may proceed to distribute the trust property in accordance with the terms of the trust even though the period for contesting the validity of the trust has not expired. The trustee is not subject to liability for doing so unless:
(1) the trustee knows of a pending judicial proceeding contesting the validity of the trust; or
(2) a potential contestant has notified the trustee of a possible judicial proceeding to contest the trust and a judicial proceeding is commenced within 60 days after the contestant sent the notification.
(f) A beneficiary of a trust that is determined to have been invalid is liable to return any distribution received.
(g) If the laws of this state govern a trust’s validity and the trust has its principal place of administration in this state, then the trust and any transfer of property by a settlor to the trust shall not be void or voidable for either of the following reasons:
(1) The laws of a foreign jurisdiction prohibit or do not recognize the concept of a trust; or
(2) The trust or the transfer defeats any forced heirship, legitime, forced share, or any similar heirship right under the laws of a foreign jurisdiction.
(b) A person may commence a judicial proceeding to contest the validity of a trust within the earlier of:
Terms Used In New Hampshire Revised Statutes 564-B:4-406
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- following: when used by way of reference to any section of these laws, shall mean the section next preceding or following that in which such reference is made, unless some other is expressly designated. See New Hampshire Revised Statutes 21:13
- Fraud: Intentional deception resulting in injury to another.
- Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- person: may extend and be applied to bodies corporate and politic as well as to individuals. See New Hampshire Revised Statutes 21:9
- petition: when used in connection with the equity jurisdiction of the superior court, and referring to a document filed with the court, shall mean complaint, and "petitioner" shall mean plaintiff. See New Hampshire Revised Statutes 21:51
- Revocable trust: A trust agreement that can be canceled, rescinded, revoked, or repealed by the grantor (person who establishes the trust).
- state: when applied to different parts of the United States, may extend to and include the District of Columbia and the several territories, so called; and the words "United States" shall include said district and territories. See New Hampshire Revised Statutes 21:4
- Trustee: A person or institution holding and administering property in trust.
- Venue: The geographical location in which a case is tried.
(1) in the case of a trust that was revocable at the settlor’s death, 3 years after the settlor’s death;
(2) in the case of an irrevocable trust, including a formerly revocable trust that has become irrevocable, 3 years after the trustee sent to the beneficiary a notice described in N.H. Rev. Stat. § 564-B:8-813(c)(3); or
(3) in the case of an irrevocable trust, including a trust that was revocable at the settlor’s death or a formerly revocable trust that has become irrevocable, 180 days after the trustee sent the person a copy of the trust instrument and a notice informing the person of the trust’s existence, the trustee’s name, address, and telephone number, and the time allowed for commencing a proceeding to contest the validity of a trust.
(c) A trustee may send the notice described in subsection (b)(3) for purposes of commencing the 180-day limitation period, but the trustee does not have a duty to do so. A trustee shall not be liable to any person for not sending the notice described in subsection (b)(3).
(d) During his or her life, a settlor may commence a judicial proceeding to determine the validity of a trust that he or she created, subject only to the trust’s subsequent amendment or revocation if the trust is revocable.
(1) The trust instrument must expressly provide that this state‘s laws govern the trust’s validity, interpretation, and administration, and the trust must have its principal place of administration within this state.
(2) The venue for the judicial proceeding is in the county where the trust has its principal place of administration.
(3) In addition to the settlor, each of the following persons is an interested person in the judicial proceeding:
(A) the settlor’s spouse;
(B) the persons who, if the settlor had died on the date of filing the petition, would be the settlor’s heirs;
(C) the qualified beneficiaries;
(D) the trustees, trust advisors, and trust protectors;
(E) if the trust is wholly or partially a charitable trust, the director of charitable trusts;
(F) if the trust is a trust for the care of an animal under N.H. Rev. Stat. § 564-B:4-408, the persons who, under the terms of the trust, have the power to enforce the trust;
(G) if the trust is a trust authorized under N.H. Rev. Stat. § 564-B:4-409, the persons who, under the terms of the trust, have the power to enforce the trust; and
(H) any other persons who would be an interested person in a judicial proceeding to determine the validity of the trust.
(4) In the case of a revocable trust, the qualified beneficiaries and other interested persons shall be determined as if the trust was irrevocable on the date of filing the petition, and each of the qualified beneficiaries and other interested persons shall be deemed possessed of inchoate property rights.
(5) Notice shall be given to each of the interested persons. The court may order notice be given to other persons.
(6) After a hearing, the court shall declare whether the trust is valid or invalid, and it may make other findings of fact and conclusions of law that are appropriate under the circumstances.
(7) A trust for which there is a declaration of validity under this subsection may be modified or revoked in the same manner as a trust for which there is no declaration of validity under this subsection.
(8) A settlor’s failure to commence a judicial proceeding under this subsection shall not be construed as evidence or as an admission that the trust is invalid for any reason.
(e) A trustee may proceed to distribute the trust property in accordance with the terms of the trust even though the period for contesting the validity of the trust has not expired. The trustee is not subject to liability for doing so unless:
(1) the trustee knows of a pending judicial proceeding contesting the validity of the trust; or
(2) a potential contestant has notified the trustee of a possible judicial proceeding to contest the trust and a judicial proceeding is commenced within 60 days after the contestant sent the notification.
(f) A beneficiary of a trust that is determined to have been invalid is liable to return any distribution received.
(g) If the laws of this state govern a trust’s validity and the trust has its principal place of administration in this state, then the trust and any transfer of property by a settlor to the trust shall not be void or voidable for either of the following reasons:
(1) The laws of a foreign jurisdiction prohibit or do not recognize the concept of a trust; or
(2) The trust or the transfer defeats any forced heirship, legitime, forced share, or any similar heirship right under the laws of a foreign jurisdiction.