Title: |
SENATE
BILL NO. 162 |
"An
Act relating to the rule against perpetuities,
nonvested property interests, and powers of
appointment; and providing for an effective
date." |
BE
IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
*
Section 1. AS 34.27 is amended by adding new sections
to article 1 to read:
Sec.
34.27.040. Abolition of rule against perpetuities.
(a)
Unless expressly stated otherwise in the governing
instrument, the duration of a nonvested property interest,
a general power of appointment not presently exercisable
because of a condition precedent, a nongeneral power
of appointment, and a general testamentary power of
appointment is perpetual and is not subject to termination,
limitation, or restriction.
(b)
This section supersedes the rule of the common law
known as the rule against perpetuities.
(c)
Except as provided in AS 34.27.042, this section does
not apply if the governing instrument was entered
into before the effective date of this Act.
Sec. 34.27.042. Applicability of AS 34.27.040 to
certain nonvested property 02 interests.
(a)
AS 34.27.040 applies to an instrument creating a nonvested
property interest in a trust under which all or part
of the income or principal of the trust may be distributed,
in the discretion of the trustee, to a person who
was living when the trust was created if the nonvested
interest in the trust was executed on or after April
2, 1997.
(b)
AS 34.27.040 applies to an instrument creating a nonvested
property interest in a trust if the trust instrument
was created in another state or country before April
2, 1997, and the situs of the trust was moved to this
state on or after April 2, 1997.
*
Sec. 2. AS 34.27.050(a) is amended to read:
(a)
A nonvested property interest is invalid unless the interest is created on or after January 1, 1996,
and before the effective date of this Act and
(1)
when the interest is created, it is certain to vest
or terminate no later than 21 years after the death
of an individual then alive; or
(2)
the interest either vests or terminates within 90
years after its creation
[;
OR (3) THE INTEREST IS IN A TRUST AND ALL OR PART
OF THE INCOME OR PRINCIPAL OF THE TRUST MAY BE DISTRIBUTED,
IN THE DISCRETION OF THE TRUSTEE, TO A PERSON WHO
IS LIVING WHEN THE TRUST IS CREATED].
* Sec. 3. AS 34.27.050(b) is amended to read:
(b)
A general power of appointment not presently exercisable
because of a condition precedent is invalid unless the power of appointment is created on or after January
1, 1996, and before the effective date of this Act
and
(1)
when the power is created, the condition precedent
is certain to be satisfied or become impossible
to satisfy no later than 21 years after the death
of an individual then alive; or
(2)
the condition precedent either is satisfied or becomes
impossible to satisfy within 90 years after its creation.
* Sec. 4. AS 34.27.050(c) is amended to read:
(c)
A nongeneral power of appointment or a general testamentary
power of appointment is invalid unless the power
is created on or after January 1, 1996, and before
the effective date of this Act and
(1)
when the power is created, it is certain to be irrevocably
exercised or otherwise to terminate no later than
21 years after the death of an individual then alive;
or
(2)
the power is irrevocably exercised or otherwise terminates
within 90 years after its creation.
*
Sec. 5. AS 34.27.070(a) is amended to read:
(a)
Except as extended by (b) of this section, AS 34.27.050
- 34.27.090 apply to a nonvested property interest
or a power of appointment that is created on or after
January 1, 1996, and before the effective date
of this Act . For purposes of this section, a
nonvested property interest or a power of appointment
created by the exercise of a power of appointment
is created when the power is irrevocably exercised
or when a revocable exercise becomes irrevocable.
*
Sec. 6. AS 34.27.075 is amended to read:
Sec.
34.27.075. Supersession of common law rule. AS 34.27.050 - 34.27.090 supersede the rule of the
common law known as the rule against perpetuities to the extent provided under AS 34.27.050 - 34.27.090
.
*
Sec. 7. AS 34.27.042, added by sec. 1 of this
Act, is retroactive to April 2, 1997, and applies
to nonvested property interests in trusts as described
in that section.
* Sec. 8. This Act takes effect immediately
under AS 01.10.070(c).
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