(a) A nonvested property interest is invalid unless one (1) of the following conditions is satisfied:

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Terms Used In Tennessee Code 66-1-202

  • Irrevocable trust: A trust arrangement that cannot be revoked, rescinded, or repealed by the grantor.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.
  • Precedent: A court decision in an earlier case with facts and law similar to a dispute currently before a court. Precedent will ordinarily govern the decision of a later similar case, unless a party can show that it was wrongly decided or that it differed in some significant way.
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Trustee: A person or institution holding and administering property in trust.
(1) When the interest is created, it is certain to vest or terminate no later than twenty-one (21) years after the death of an individual then alive;
(2) The interest either vests or terminates within ninety (90) years after its creation; or
(3) The interest satisfies the conditions set forth in subsection (f).
(b) A general power of appointment not presently exercisable because of a condition precedent is invalid unless one (1) of the following conditions is satisfied:

(1) When the power is created, the condition precedent is certain to be satisfied or becomes impossible to satisfy no later than twenty-one (21) years after the death of an individual then alive;
(2) The condition precedent either is satisfied or becomes impossible to satisfy within ninety (90) years after its creation; or
(3) The condition precedent satisfies the conditions set forth in subsection (f).
(c) A non-general power of appointment or a general testamentary power of appointment is invalid unless one (1) of the following conditions is satisfied:

(1) When the power is created, it is certain to be irrevocably exercised or otherwise to terminate no later than twenty-one (21) years after the death of an individual then alive; or
(2) The power is irrevocably exercised or otherwise terminates within ninety (90) years after its creation.
(d) In determining whether a nonvested property interest or a power of appointment is valid under subdivision (a)(1), (b)(1), or (c)(1), the possibility that a child will be born to an individual after the individual’s death is disregarded.
(e) If, in measuring a period from the creation of a trust or other property arrangement, language in a governing instrument seeks to disallow the vesting or termination of any interest or trust beyond, seeks to postpone the vesting or termination of any interest or trust until, or seeks to operate in effect in any similar fashion upon, the later of:

(1) The expiration of a period of time not exceeding twenty-one (21) years after the death of the survivor of specified lives in being at the creation of the trust or other property arrangement; or
(2) The expiration of a period of time that exceeds or might exceed twenty-one (21) years after the death of the survivor of lives in being at the creation of the trust or other property arrangement;

such language is inoperative to the extent it produces a period of time that exceeds twenty-one (21) years after the death of the survivor of the specified lives.

(f) As to any trust created after June 30, 2007, or that becomes irrevocable after June 30, 2007, the terms of the trust shall require that all beneficial interests in the trust vest or terminate or the power of appointment is exercised within three hundred sixty (360) years.
(g) If a trustee of an irrevocable trust transfers to this state the principal place of administration of a trust validly created in a foreign jurisdiction, as defined in § 35-15-103, then all beneficial interests in the trust must vest or terminate and any power of appointment must be exercised within:

(1) If the trust instrument does not contain a state jurisdiction provision as defined in § 35-15-107, the least of three-hundred sixty (360) years from the date of creation of the trust, the period stated in the trust instrument, or the period governing under the law of the foreign jurisdiction in effect in the jurisdiction at the time the trust became irrevocable; or
(2) If the trust instrument does contain a state jurisdiction provision as defined in § 35-15-107, the lesser of the period stated in the trust instrument, or the period governing under the law provided in the state jurisdiction provision.
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