Virginia Code 64.2-2735: Creditor claim; general power created by powerholder.
A. As used in this section, “power of appointment created by the powerholder” includes a power of appointment created in a transfer by another person to the extent that the powerholder contributed value to the transfer.
Terms Used In Virginia Code 64.2-2735
- Appointive property: means the property or property interest subject to a power of appointment. See Virginia Code 64.2-2700
- Decedent: A deceased person.
- General power of appointment: means a power of appointment exercisable in favor of the powerholder, the powerholder's estate, a creditor of the powerholder, or a creditor of the powerholder's estate. See Virginia Code 64.2-2700
- Includes: means includes, but not limited to. See Virginia Code 1-218
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Person: means an individual; estate; trust; business or nonprofit entity; public corporation; government or governmental subdivision, agency, or instrumentality; or other legal entity. See Virginia Code 64.2-2700
- Power of appointment: means a power that enables a powerholder acting in a nonfiduciary capacity to designate a recipient of an ownership interest in or another power of appointment over the appointive property. See Virginia Code 64.2-2700
- Powerholder: means a person in which a donor creates a power of appointment. See Virginia Code 64.2-2700
B. Appointive property subject to a general power of appointment created by the powerholder is subject to a claim of a creditor of the powerholder or of the powerholder’s estate to the extent provided in Chapter 4 of Title 55.1.
C. Subject to subsection B, appointive property subject to a general power of appointment created by the powerholder is not subject to a claim of a creditor of the powerholder or the powerholder’s estate to the extent that the powerholder irrevocably appointed the property in favor of a person other than the powerholder or the powerholder’s estate.
D. Subject to subsections B and C, and notwithstanding the presence of a spendthrift provision or whether the claim arose before or after the creation of the power of appointment, appointive property subject to a general power of appointment created by the powerholder is subject to a claim of a creditor of:
1. The powerholder, to the same extent as if the powerholder owned the appointive property, if the power is presently exercisable; and
2. The powerholder’s estate, to the extent that the estate is insufficient to satisfy the claim and subject to the right of a decedent to direct the source from which liabilities are paid, if the power is exercisable at the powerholder’s death.
2016, c. 266.