USA Statutes : nevada
Title : Title 13 - GUARDIANSHIPS; CONSERVATORSHIPS; TRUSTS
Chapter : CHAPTER 163 - TRUSTS
As used in this chapter, unless the
context otherwise requires, the words and terms defined in NRS 163.0011
to 163.0017 , inclusive, have the meanings ascribed to
them in those sections.
(Added to NRS by 2001, 2350 )
“Electronic record” has
the meaning ascribed to it in NRS 132.117 .
(Added to NRS by 2001, 2350 )
“Electronic
signature” has the meaning ascribed to it in NRS 132.118 .
(Added to NRS by 2001, 2350 )
“Electronic trust” means
a trust instrument that complies with the requirements of NRS 163.0095
.
(Added to NRS by 2001, 2350 )
“Record” has the meaning ascribed
to it in NRS 132.287 .
(Added to NRS by 2001, 2350 )
” As used in this
chapter, unless the context otherwise requires, when the term “writing”
or “written” is used in reference to a will, trust or instrument to
convey property, the term includes an electronic will as defined in NRS
132.119 or an electronic trust as
defined in NRS 163.0015 , as
appropriate.
(Added to NRS by 2001, 2350 )
CREATION AND VALIDITY OF TRUSTS
Except as otherwise provided by
specific statute, a trust may be created by any of the following methods:
1. A declaration by the owner of property that he holds the
property as trustee.
2. A transfer of property by the owner during his lifetime to
another person as trustee.
3. A testamentary transfer of property by the owner to another
person as trustee.
4. An exercise of a power of appointment to another person as
trustee.
5. An enforceable promise to create a trust.
(Added to NRS by 1991, 1704)
A trust is created only if:
1. The settlor properly manifests an intention to create a trust;
and
2. There is trust property, except as otherwise provided in NRS
163.230 .
(Added to NRS by 1991, 1704; A 1999, 2367 )
1. A trust may be created for any purpose that is not illegal or
against public policy.
2. A trust created for an indefinite or general purpose is not
invalid for that reason if it can be determined with reasonable certainty
that a particular use of the trust property is within that purpose.
(Added to NRS by 1991, 1704)
Consideration is not
required to create a trust, but a promise to create a trust in the future
is enforceable only if it meets the requirements for enforcement as a
contract.
(Added to NRS by 1991, 1705)
A trust, other than a
charitable trust, is created only if there is a beneficiary. This
requirement is satisfied if the trust instrument provides for:
1. A beneficiary or class of beneficiaries that is ascertainable
with reasonable certainty or that is sufficiently described so that it
can be determined whether a person meets the description or is within the
class; or
2. A grant of power to the trustee or some other person to select
the beneficiary based on a standard or in the discretion of the trustee
or other person.
(Added to NRS by 1991, 1704)
If a trust provides for one or more successor
beneficiaries after the death of the settlor, the trust is not
invalidated, merged or terminated because:
1. There is one settlor who is the sole trustee and the sole
beneficiary during the lifetime of the settlor; or
2. There are two or more settlors, one or more of whom are
trustees, and the beneficial interest in the trust is in one or more of
the settlors during the lifetime of the settlors.
(Added to NRS by 1991, 1704)
1. A trust created for the care of one or more animals that are
alive at the time of the settlor’s death is valid. Such a trust
terminates upon the death of all animals covered by the terms of the
trust. A settlor’s expression of intent must be liberally construed in
favor of the creation of such a trust.
2. Except as otherwise provided in this subsection, property of a
trust described in subsection 1 may not be used in a manner inconsistent
with its intended use. Except as otherwise directed by the terms of the
trust, if a court determines that the value of a trust described in
subsection 1 exceeds the amount required to care for the animal
beneficiary, the excess amount must be distributed to the person who
would have taken the trust property if the trust had terminated on the
date of the distribution.
3. The intended use of a trust described in subsection 1 may be
enforced by the trustee or, if a trustee was not designated, by a person
appointed by the court to act as the trustee. A person having a
demonstrated interest in the welfare of the animal beneficiary may
petition the court for an order to appoint himself as trustee or to
remove the trustee. The court shall give preference for appointment to a
person who demonstrates such an interest.
(Added to NRS by 2001, 958 )
1. A trust created in relation to real property is not valid
unless it is created by operation of law or is evidenced by:
(a) A written instrument signed by the trustee, or by the agent of
the trustee if he is authorized in writing to do so; or
(b) A written instrument, including, without limitation, an
electronic trust, conveying the trust property and signed by the settlor,
or by the agent of the settlor if he is authorized in writing to do so.
2. Such a trust may be recorded in the office of the county
recorder in the county where all or a portion of the real property is
located.
(Added to NRS by 1991, 1704; A 2001, 2350 )
1. The existence and terms of an oral trust of personal property
may be established only by clear and convincing evidence. The oral
declaration of the settlor, in and of itself, is not sufficient to
establish the creation of such a trust.
2. A reference in statute to a trust instrument or declaration
means, in the case of an oral trust, the terms of the trust as
established by clear and convincing evidence.
(Added to NRS by 1991, 1705)
1. An electronic trust is a trust instrument that:
(a) Is written, created and stored in an electronic record;
(b) Contains the electronic signature of the settlor; and
(c) Meets the requirements set forth in this chapter for a valid
trust.
2. An electronic trust shall be deemed to be executed in this
State if the electronic trust is:
(a) Transmitted to and maintained by a custodian designated in the
trust instrument at his place of business in this State or at his
residence in this State; or
(b) Maintained by the settlor at his place of business in this
State or at his residence in this State, or by the trustee at his place
of business in this State or at his residence in this State.
3. The provisions of this section do not apply to a testamentary
trust.
(Added to NRS by 2001, 2350 )
GENERAL UNIFORM ACT
NRS 163.010 to 163.200 ,
inclusive, may be cited as the Uniform Trusts Act.
[20:136:1941; 1931 NCL § 7718.49]—(NRS A 1967, 763; 1999, 2367
)
As used in NRS 163.010 to 163.200 ,
inclusive, unless the context or subject matter otherwise requires:
1. “Affiliate” means any person directly or indirectly controlling
or controlled by another person, or any person under direct or indirect
common control with another person. It includes any person with whom a
trustee has an express or implied agreement regarding the purchase of
trust investments by each from the other, directly or indirectly, except
a broker or stock exchange.
2. “Relative” means a spouse, ancestor, descendant, brother or
sister.
3. “Trust” means an express trust only.
4. “Trustee” means the person holding property in trust and
includes trustees, a corporate as well as a natural person and a
successor or substitute trustee.
[1:136:1941; 1931 NCL § 7718.30]—(NRS A 1967, 763; 1985, 510; 1999,
2367 )
A trustee has the powers provided
in the trust instrument, expressed by law or granted by the court upon
petition, as necessary or appropriate to accomplish a purpose of the
trust, but the court may not grant a power expressly prohibited by the
trust instrument.
(Added to NRS by 1999, 2366 )
1. Except as otherwise provided in subsection 2 or in the trust, a
trustee may distribute property and money:
(a) In divided or undivided interests; and
(b) With or without proration.
2. Each affected beneficiary must consent before property or money
is distributed without proration, unless the trust specifically
authorizes the trustee to make that distribution.
(Added to NRS by 1999, 2366 )
Except as provided in
NRS 163.040 , no corporate trustee shall
lend trust funds to itself or an affiliate, or to any director, officer,
or employee of itself or of an affiliate; nor shall any noncorporate
trustee lend trust funds to himself, or to his relative, employer,
employee, partner, or other business associate.
[2:136:1941; 1931 NCL § 7718.31]
1. A corporate trustee which is subject to regulation and
supervision by state or federal authorities may deposit with itself trust
funds which are being held necessarily pending investment, distribution,
or the payment of debts, provided it pays into the trust for the deposit
such interest as it is required by statute to pay on uninvested trust
funds, or, if there is no statute, the same rate of interest it pays upon
similar nontrust deposits, and maintains in its trust department as
security for those deposits a separate fund consisting of securities
legal for trust investments and at all times equal in total market value
to the amount of the deposits. No security may be required to the extent
that the deposit is insured or given a preference by any state or federal
law.
2. The separate fund of securities must be marked as such.
Withdrawals from or additions to it may be made from time to time, as
long as the required value is maintained. The income of the securities
belongs to the corporate trustee. In all statements of its financial
condition published, or delivered to the Commissioner of Financial
Institutions, the corporate trustee shall show as separate items the
amount of trust funds which it has deposited with itself and the amount
of securities which it holds as security for the payment of those
deposits.
[3:136:1941; 1931 NCL § 7718.32]—(NRS A 1983, 1697; 1987, 1875)
1. Except as otherwise provided in subsection 2, no trustee may
directly or indirectly buy or sell any property for the trust from or to
itself or an affiliate, or from or to a director, officer or employee of
the trustee or of an affiliate, or from or to a relative, employer,
partner or other business associate of a trustee, except with the prior
approval of the court having jurisdiction of the trust estate.
2. If authorized by the trust instrument or consented to by all
beneficiaries of the trust, a corporate trustee may directly or
indirectly buy or sell any property, other than real property, for the
trust from or to itself or an affiliate, or from or to a director,
officer or employee of the trustee or of an affiliate, or from or to a
relative, employer, partner or other business associate of the trustee.
[4:136:1941; 1931 NCL § 7718.33]—(NRS A 1999, 2367 ; 2003, 2265 )
1. Except as otherwise provided in subsection 2 or authorized by
the trust instrument, a trustee shall not as trustee of one trust sell
property to itself as trustee of another trust except with the approval
of the court having jurisdiction of the trust estate.
2. A bank or other corporate trustee which is subject to
regulation by state or federal authorities may sell a security which is
listed on a regulated stock exchange or sold over the counter by the
National Association of Securities Dealers and is held by it as fiduciary
in one account to itself as fiduciary in another account if the
transaction is fair to the beneficiaries of both accounts and is not
otherwise expressly prohibited by a particular statute.
[5:136:1941; 1931 NCL § 7718.34]—(NRS A 1981, 557; 1999, 2367
)
Except as otherwise authorized by the trust instrument or order of the
court, a corporate trustee shall not purchase for a trust shares of its
own stock, or its bonds or other securities, or the stock, bonds or other
securities of an affiliate.
[6:136:1941; 1931 NCL § 7718.35]—(NRS A 1999, 2367 )
A trustee owning corporate stock may
vote it by proxy, but shall be liable for any loss resulting to the
beneficiaries from a failure to use reasonable care in deciding how to
vote the stock and in voting it.
[7:136:1941; 1931 NCL § 7718.36]
A trustee owning
stock may hold it in the name of a nominee without mention of the trust
in the stock certificate or stock registration books; providing that:
1. The trust records and all reports or accounts rendered by the
trustee clearly show the ownership of the stock by the trustee and the
facts regarding its holding; and
2. The nominee shall deposit with the trustee a signed statement
showing the trust ownership.
Ê The trustee shall be personally liable for any loss to the trust
resulting from any act of such nominee in connection with stock so held.
[8:136:1941; 1931 NCL § 7718.37]—(NRS A 1961, 471)
Unless it is
otherwise provided by the trust instrument or by court order, all powers
of a trustee are attached to the office and are not personal.
[9:136:1941; 1931 NCL § 7718.38]—(NRS A 1999, 2368 )
1. Unless it is otherwise provided by the trust instrument or by
court order, any power vested in three or more trustees may be exercised
by a majority of the trustees. A trustee who has not joined in exercising
a power is not liable to the beneficiaries or to others for the
consequences of the exercise of power and a dissenting trustee is not
liable for the consequences of an act in which that trustee joined at the
direction of the majority trustees, if he expressed his dissent in
writing to any of his cotrustees at or before the time of the joinder.
2. This section does not excuse a cotrustee from liability for
inactivity in the administration of the trust nor for failure to attempt
to prevent a breach of trust.
3. Except as otherwise authorized in the trust instrument or by
order of the court, a power vested in two trustees may only be exercised
by unanimous action.
4. If the trustees cannot exercise a power vested in them in a
manner permitted by this section, an interested person may petition the
court for appropriate instructions pursuant to NRS 164.010 and 164.015 .
[10:136:1941; 1931 NCL § 7718.39]—(NRS A 1999, 2368 )
1. If a trustee commits or threatens to commit a breach of trust,
a beneficiary or cotrustee of the trust may maintain a proceeding for any
of the following purposes that is appropriate:
(a) To compel the trustee to perform his duties.
(b) To enjoin the trustee from committing the breach of trust.
(c) To compel the trustee to redress the breach of trust by payment
of money or otherwise.
(d) To appoint a receiver or temporary trustee to take possession
of the trust property and administer the trust.
(e) To remove the trustee.
(f) To set aside acts of the trustee.
(g) To reduce or deny compensation of the trustee.
(h) To impose an equitable lien or a constructive trust on trust
property.
(i) To trace trust property that has been wrongfully disposed of
and recover the property or its proceeds.
2. The provision of remedies in subsection 1 does not preclude
resort to any other appropriate remedy provided by statute or common law.
3. A proceeding under this section must be commenced by filing a
petition under NRS 164.010 and 164.015
.
(Added to NRS by 1999, 2365 )
1. A claim based on a contract entered into by a trustee in the
capacity of representative, or on an obligation arising from ownership or
control of trust property, may be asserted against the trust by
proceeding against the trustee in the capacity of representative, whether
or not the trustee is personally liable on the claim.
2. A judgment may not be entered in favor of the plaintiff in the
action unless the plaintiff proves that within 30 days after filing the
action, or within 30 days after the filing of a report of an early case
conference if one is required, whichever is longer, or within such other
time as the court may fix, and more than 30 days before obtaining the
judgment, the plaintiff notified each of the beneficiaries known to the
trustee who then had a present interest, or in the case of a charitable
trust, the Attorney General and any corporation which is a beneficiary or
agency in the performance of the charitable trust, of the existence and
nature of the action. The notice must be given by mailing copies to the
beneficiaries at their last known addresses. The trustee shall furnish
the plaintiff a list of the beneficiaries to be notified, and their
addresses, within 10 days after written demand therefor, and notification
of the persons on the list constitutes compliance with the duty placed on
the plaintiff by this section. Any beneficiary, or in the case of
charitable trusts the Attorney General and any corporation which is a
beneficiary or agency in the performance of the charitable trust, may
intervene in the action and contest the right of the plaintiff to recover.
3. Except as otherwise provided in this chapter or in the
contract, a trustee is not personally liable on a contract properly
entered into in the capacity of representative in the course of
administration of the trust unless the trustee fails to reveal the
representative capacity or identify the trust in the contract. The
addition of the word “trustee” or the words “as trustee” after the
signature of a trustee to a contract are prima facie evidence of an
intent to exclude the trustee from personal liability.
[11:136:1941; 1931 NCL § 7718.40]—(NRS A 1999, 2368 )
1. A trustee who has incurred personal liability for a tort
committed in the administration of the trust is entitled to exoneration
therefor from the trust property if he has not discharged the claim, or
to be reimbursed therefor out of trust funds if he has paid the claim, if:
(a) The tort was a common incident of the kind of business activity
in which the trustee was properly engaged for the trust; or
(b) Although the tort was not a common incident of such activity,
neither the trustee nor any officer or employee of the trustee was guilty
of personal fault in incurring the liability.
2. If a trustee commits a tort which increases the value of the
trust property, he shall be entitled to exoneration or reimbursement with
respect thereto to the extent of such increase in value, even though he
would not otherwise be entitled to exoneration or reimbursement.
3. Nothing in this section shall be construed to change the
existing law with regard to the liability of trustees of charitable
trusts for torts of themselves or their employees.
[12:136:1941; 1931 NCL § 7718.41]
1. If a trustee or his predecessor has committed a tort in the
course of his administration of the trust, the trustee in the capacity of
representative may be sued and collection had from the trust property, if
the court determines in the action that:
(a) The tort was a common incident of the kind of business activity
in which the trustee or his predecessor was properly engaged for the
trust;
(b) That, although the tort was not a common incident of such
activity, neither the trustee nor his predecessor, nor any officer or
employee of the trustee or his predecessor, was guilty of personal fault
in incurring the liability; or
(c) That, although the tort did not fall within paragraph (a) or
(b), it increased the value of the trust property.
Ê If the tort is within paragraph (a) or (b), collection may be had of
the full amount of damage proved, and if the tort is within paragraph (c)
above, collection may be had only to the extent of the increase in the
value of the trust property.
2. In an action against the trustee in the capacity of
representative under this section, the plaintiff need not prove that the
trustee could have secured reimbursement from the trust fund if the
trustee had paid the plaintiff’s claim.
3. A judgment may not be entered in favor of the plaintiff in the
action unless he proves that, within 30 days after filing the action, or
within 30 days after the filing of a report of an early case conference
if one is required, whichever is longer, or within such other period as
the court may fix, and more than 30 days before obtaining the judgment,
he notified each of the beneficiaries known to the trustee who then had a
present interest of the existence and nature of the action. The notice
must be given by mailing copies to the beneficiaries at their last known
addresses. The trustee shall furnish the plaintiff a list of the
beneficiaries and their addresses, within 10 days after written demand
therefor, and notification of the persons on the list constitutes
compliance with the duty placed on the plaintiff by this section. Any
beneficiary may intervene in the action and contest the right of the
plaintiff to recover.
4. Subject to the rights of exoneration or reimbursement provided
in NRS 163.130 , the trustee may also be
held personally liable for any tort committed by him, or by his agents or
employees in the course of their employments only if the trustee, agent
or employee is personally at fault.
5. This section does not change the existing law with regard to
the liability of trustees of charitable trusts for torts of themselves or
their employees.
[13:136:1941; 1931 NCL § 7718.42]—(NRS A 1999, 2369 )
Except as otherwise
specifically provided in the trust instrument, a person who holds a power
to appoint or distribute income or principal to or for the benefit of
others, individually or as trustee, may not use the power to discharge
his legal obligations.
(Added to NRS by 1999, 2365 )
Where a person who is a trustee of two or more trusts has mingled the
money of two or more trusts in the same aggregate of cash, or in the same
bank, credit union or brokerage account or other investment, and a
withdrawal is made therefrom by the trustee for his own benefit, or for
the benefit of a third person not a beneficiary or creditor of one or
more of the trusts, or for an unknown purpose, the withdrawal must be
charged first to the amount of cash, credit or other property of the
trustee in the mingled fund, if any, and after the exhaustion of the
trustee’s cash, credit or other property, then to the trusts in
proportion to their interests in the cash, credit or other property at
the time of the withdrawal.
[14:136:1941; 1931 NCL § 7718.43]—(NRS A 1999, 1459 )
1. The settlor of a trust affected by NRS 163.010 to 163.200 ,
inclusive, may, by provision in the instrument creating the trust if the
trust was created by a writing, or by oral statement to the trustee at
the time of the creation of the trust if the trust was created orally, or
by an amendment of the trust if the settlor reserved the power to amend
the trust, relieve his trustee from any or all of the duties,
restrictions and liabilities which would otherwise be imposed upon him by
NRS 163.010 to 163.200 , inclusive, or alter or deny to his trustee
any or all of the privileges and powers conferred upon the trustee by NRS
163.010 to 163.200 , inclusive, or add duties, restrictions,
liabilities, privileges or powers to those imposed or granted by NRS
163.010 to 163.200 , inclusive, but no act of the settlor relieves
a trustee from the duties, restrictions and liabilities imposed upon him
by NRS 163.030 , 163.040 and 163.050 .
2. Except as otherwise provided in subsections 1 and 3, a trustee
may be relieved of liability for breach of trust by provisions of the
trust instrument.
3. A provision of the trust instrument is not effective to relieve
a trustee of liability:
(a) For breach of trust committed intentionally, with gross
negligence, in bad faith, or with reckless indifference to the interest
of a beneficiary; or
(b) For any profit that he derives from a breach of trust.
[15:136:1941; 1931 NCL § 7718.44]—(NRS A 1999, 2370 )
A beneficiary of a trust
affected by NRS 163.010 to 163.200
, inclusive, may, if of full legal
capacity and acting upon full information, by written instrument
delivered to the trustee, relieve the trustee as to that beneficiary from
any or all of the duties, restrictions and liabilities which would
otherwise be imposed on the trustee by NRS 163.010 to 163.200 ,
inclusive, except as to the duties, restrictions and liabilities imposed
by NRS 163.030 , 163.040 and 163.050 .
The beneficiary may release the trustee from liability to him for past
violations of any of the provisions of NRS 163.010 to 163.200 ,
inclusive.
[16:136:1941; 1931 NCL § 7718.45]—(NRS A 1999, 2370 )
A court may, for cause shown and upon
notice to the beneficiaries, relieve a trustee from any or all of the
duties and restrictions which would otherwise be placed upon the trustee
by NRS 163.010 to 163.200 , inclusive, or wholly or partly excuse a
trustee who has acted honestly and reasonably from liability for
violation of the provisions of NRS 163.010 to 163.200 ,
inclusive.
[17:136:1941; 1931 NCL § 7718.46]—(NRS A 1967, 763; 1999, 2371
)
Upon such terms and
conditions as are just and proper, the court may order termination and
distribution of a trust before the time provided in the trust instrument,
if administration or continued administration of the trust is no longer
feasible or economical. A petition for such an order may be filed by an
interested person under. NRS 164.010
and 164.015 .
(Added to NRS by 1999, 2366 )
If a trustee violates any of the provisions of NRS 163.010
to 163.200 , inclusive, he may be removed and denied
compensation in whole or in part, and any beneficiary, cotrustee or
successor trustee may treat the violation as a breach of trust.
[18:136:1941; 1931 NCL § 7718.47]—(NRS A 1967, 763; 1999, 2371
)
NRS 163.010 to 163.200 ,
inclusive, must be so interpreted and construed as to effectuate their
general purpose to make uniform the law of those states which enact them.
[19:136:1941; 1931 NCL § 7718.48]—(NRS A 1967, 763; 1999, 2371
)
TESTAMENTARY ADDITIONS TO TRUSTS (UNIFORM ACT)
This section and NRS 163.230 and 163.250
may be cited as the Uniform Testamentary Additions to Trusts Act.
(Added to NRS by 1967, 762)
1. A devise, the validity of which is determinable by the law of
this state, may be made by a will to a trustee or trustees of a trust
established or created by the testator, or by the testator and some other
person or persons, or by some other person or persons, including a funded
or unfunded life insurance trust, although the settlor has reserved any
or all rights of ownership of the insurance contracts, if the trust is
identified in the testator’s will and the terms are set forth in a
written instrument other than a will, executed before or concurrently
with the execution of the testator’s will, or in the valid last will of a
person who has predeceased the testator, regardless of the existence,
size or character of the corpus of the trust.
2. The devise is not invalid because the trust is amendable or
revocable, or both, or because the trust was amended after the execution
of the will or after the death of the testator.
3. Unless the testator’s will provides otherwise, the property so
devised:
(a) Shall not be deemed to be held under a testamentary trust of
the testator but is a part of the trust to which it is given; and
(b) Must be administered and disposed of in accordance with the
provisions of the instrument or will setting forth the terms of the
trust, including any amendments thereto made before the death of the
testator, regardless of whether made before or after the execution of the
testator’s will, or any modifications or amendments whenever made, which
are made pursuant to the Charitable Trust Act of 1971, and, if the
testator’s will so provides, including any amendments to the trust made
after the death of the testator.
4. A revocation or termination of the trust before the death of
the testator causes the devise to lapse.
(Added to NRS by 1967, 762; A 1971, 634; 1985, 244; 1999, 2371
)
This section and NRS
163.220 and 163.230 shall be so construed as to effectuate their
general purpose to make uniform the law of those states which enact them.
(Added to NRS by 1967, 763)
TRUST POWERS WHICH MAY BE INCLUDED IN A WILL OR AGREEMENT BY REFERENCE
265 to 163.410 , inclusive; restriction on exercise of such
powers.
1. By an expressed intention of the testator or settlor to do so
contained in a will, or in an instrument in writing whereby a trust
estate is created inter vivos, any or all of the powers or any portion
thereof enumerated in NRS 163.265 to
163.410 , inclusive, as they exist at
the time that the testator signs the will or places his electronic
signature on the will, if it is an electronic will, or at the time that
the first settlor signs the trust instrument or places his electronic
signature on the trust instrument, if it is an electronic trust, may be,
by appropriate reference made thereto, incorporated in such will or other
written instrument, with the same effect as though such language were set
forth verbatim in the instrument. Incorporation of one or more of the
powers contained in NRS 163.265 to
163.410 , inclusive, by reference to the
proper section shall be in addition to and not in limitation of the
common-law or statutory powers of the fiduciary.
2. A fiduciary shall not exercise any power or authority conferred
as provided in NRS 163.260 to 163.410
, inclusive, in such a manner as, in the
aggregate, to deprive the trust or the estate involved of an otherwise
available tax exemption, deduction or credit, expressly including the
marital deduction, or operate to impose a tax upon a donor or testator or
other person as owner of any portion of the trust or estate involved.
“Tax” includes, but is not limited to, any federal income, gift, estate
or inheritance tax.
3. This section does not prevent the incorporation of the powers
enumerated in NRS 163.265 to 163.410
, inclusive, in any other kind of
instrument or agreement.
4. As used in this section, “electronic will” has the meaning
ascribed to it in NRS 132.119 .
(Added to NRS by 1969, 449; A 2001, 2350 )
A fiduciary may retain for
such time as the fiduciary deems advisable any property, real or
personal, which the fiduciary may receive, even though the retention of
such property by reason of its character, amount, proportion to the total
estate or otherwise would not be appropriate for the fiduciary apart from
this provision.
(Added to NRS by 1969, 449)
1. A fiduciary may:
(a) Sell, exchange, give options upon, partition or otherwise
dispose of any property or interest therein which the fiduciary may hold
from time to time, with or without order of court, at public or private
sale or otherwise, upon such terms and conditions, including credit, and
for such consideration as the fiduciary deems advisable.
(b) Transfer and convey the property or interest therein which is
at the disposal of the fiduciary, in fee simple, absolute or otherwise,
free of all trust.
2. The person dealing with the fiduciary has no duty to follow the
proceeds or other consideration received by the fiduciary from such sale
or exchange.
(Added to NRS by 1969, 449)
1. A fiduciary may invest and reinvest, as he deems advisable:
(a) In stocks, common or preferred, bonds, debentures, notes,
mortgages or other securities in or outside the United States;
(b) In insurance contracts on the life of any beneficiary or of any
person in whom a beneficiary has an insurable interest, or in annuity
contracts for any beneficiary;
(c) In any real or personal property;
(d) In investment trusts;
(e) In participations in common trust funds;
(f) In securities of any corporation, trust, association or fund:
(1) Which is engaged, or proposes to engage, in the business
of investing, reinvesting, owning, holding or trading in securities;
(2) Whose assets are invested principally in cash or in
securities of other issuers; and
(3) Which is registered as an investment company with the
Securities and Exchange Commission; and
(g) Generally in such property as the fiduciary deems advisable,
even though the investment is not of the character approved by applicable
law but for this section.
2. A fiduciary may delegate the authority to invest, but he is not
thereby relieved of any liability that exists in the absence of
delegation.
(Added to NRS by 1969, 450; A 1985, 17; 1999, 2372 )
A fiduciary may
make investments which cause a greater proportion of the total property
held by the fiduciary to be invested in investments of one type or of one
company than would be considered appropriate for the fiduciary apart from
this section.
(Added to NRS by 1969, 450)
1. A fiduciary may, to the extent and upon such terms and
conditions and for such periods of time as the fiduciary deems necessary
or advisable, continue or participate in the operation of any business or
other enterprise, whatever its form of organization, including but not
limited to the power to:
(a) Effect incorporation, dissolution, or other change in the form
of the organization of the business or enterprise;
(b) Dispose of any interest therein or acquire the interest of
others therein;
(c) Contribute thereto or invest therein additional capital or to
lend money thereto, in any such case upon such terms and conditions as
the fiduciary approves from time to time; or
(d) Determine whether the liabilities incurred in the conduct of
the business are to be chargeable solely to the part of the estate or
trust set aside for use in the business or to the estate or trust as a
whole; and
2. In all cases in which the fiduciary is required to file
accounts in any court or in any other public office, it is not necessary
to itemize receipts and disbursements and distributions of property but
it is sufficient for the fiduciary to show in the account a single figure
or consolidation of figures; and the fiduciary may account for money and
property received from the business and any payments made to the business
in lump sum without itemization.
(Added to NRS by 1969, 450)
A fiduciary may form a corporation, limited-liability
company or other entity, and transfer, assign and convey to the
corporation, limited-liability company or entity all or any part of the
estate or of any trust property in exchange for the stock, securities or
obligations of the corporation, limited-liability company or entity, and
continue to hold the stock and securities and obligations.
(Added to NRS by 1969, 450; A 1999, 2372 )
A fiduciary may
continue any farming operation received by the fiduciary pursuant to the
will, trust or other instrument and do any and all things deemed
advisable by the fiduciary in the management and maintenance of such farm
and the production and marketing of crops and dairy, poultry, livestock,
orchard and the forest products, including, but not limited to, the
following powers:
1. To operate the farm with hired labor, tenants or sharecroppers;
2. To lease or rent the farm for cash or for a share of the crops;
3. To purchase or otherwise acquire farm machinery and equipment
and livestock;
4. To construct, repair and improve farm buildings of all kinds
needed, in the fiduciary’s judgment, for the operation of the farm;
5. To make or obtain loans or advances at the prevailing rate or
rates of interest for farm purposes such as for production, harvesting or
marketing, or for the construction, repair or improvement of farm
buildings, or for the purchase of farm machinery, equipment or livestock;
6. To employ approved soil conservation practices in order to
conserve, improve and maintain the fertility and productivity of the soil;
7. To protect, manage and improve the timber and forest on the
farm and sell the timber and forest products when it is to the best
interest of the estate;
8. To ditch, dam and drain damp or wet fields and areas of the
farm when and where needed;
9. To engage in the production of livestock, poultry or dairy
products, and to construct such fences and buildings and plant such
pastures and crops as may be necessary to carry on such operations;
10. To market the products of the farm; and
11. In general, to employ good husbandry in the farming operation.
(Added to NRS by 1969, 450; A 1999, 2372 )
In the management of
real property a fiduciary may:
1. Improve, manage, protect and subdivide any real property;
2. Dedicate or withdraw from dedication parks, streets, highways
or alleys;
3. Terminate any subdivision or part thereof;
4. Borrow money for the purposes authorized by this section for
such periods of time and upon such terms and conditions as to rates,
maturities and renewals as the fiduciary deems advisable and mortgage or
otherwise encumber any such property or part thereof, whether in
possession or reversion;
5. Lease any such property or part thereof to commence at the
present or in the future, upon such terms and conditions, including
options to renew or purchase, and for such period or periods of time as
the fiduciary deems advisable although such period or periods may extend
beyond the duration of the trust or the administration of the estate
involved;
6. Make gravel, sand, oil, gas and other mineral leases,
contracts, licenses, conveyances or grants of every nature and kind which
are lawful in the jurisdiction in which such property lies;
7. Manage and improve timber and forests on such property, sell
the timber and forest products, and make grants, leases and contracts
with respect thereto;
8. Modify, renew or extend leases;
9. Employ agents to rent and collect rents;
10. Create easements and release, convey or assign any right,
title or interest with respect to any easement on such property or part
thereof;
11. Erect, repair or renovate any building or other improvement on
such property, and remove or demolish any building or other improvement
in whole or in part; and
12. Deal with any such property and every part thereof in all
other ways and for such other purposes or considerations as it would be
lawful for any person owning the same to deal with such property either
in the same or in different ways from those specified elsewhere in this
section.
(Added to NRS by 1969, 451)
A fiduciary may pay
taxes, assessments, compensation of the fiduciary, and other expenses
incurred in the collection, care, administration and protection of the
trust or estate.
(Added to NRS by 1969, 452)
A fiduciary may
receive additional property from any source and administer such
additional property as a portion of the appropriate trust or estate under
the management of the fiduciary, but may not be required to receive such
property without his consent.
(Added to NRS by 1969, 452)
In dealing with one
or more fiduciaries, a fiduciary may:
1. Sell property, real or personal, to, or exchange property with,
the trustee of any trust which the decedent or the settlor or the
settlor’s spouse or any child of the settlor has created, for such
estates and upon such terms and conditions as to sale price, terms of
payment and security as to the fiduciary seem advisable. The fiduciary
has no duty to follow the proceeds of any such sale.
2. Borrow money for such periods of time and upon such terms and
conditions as to rates, maturities, renewals and securities as the
fiduciary deems available from any trust created by the decedent, or the
spouse or child of the decedent, for the purpose of:
(a) Paying debts of the decedent, taxes, the costs of the
administration of the estate and like charges against the estate, or any
part thereof; or
(b) Discharging the liability of any fiduciary thereof. A fiduciary
may mortgage, pledge or otherwise encumber such portion of the estate or
any trust as may be required to obtain the loan or loans and to renew the
loans.
(Added to NRS by 1969, 452; A 1999, 2373 )
A fiduciary
may:
1. Borrow money for such periods of time and upon such terms and
conditions as to rates, maturities, renewals and security as the
fiduciary deems advisable, including the power of a corporate fiduciary
to borrow from its own banking department, for the purpose of paying
debts, taxes or other charges against the estate or any trust, or any
part thereof;
2. Provide a guarantee by the trust or mortgage, pledge or
otherwise encumber such portion of the estate or any trust as may be
required to obtain loan or loans; and
3. Renew existing loans either as maker or endorser.
(Added to NRS by 1969, 452; A 1999, 2373 )
A fiduciary may advance money for
the protection of the trust or estate, and for all expenses, losses and
liabilities sustained in the administration of the trust or estate or
because of the holding or ownership of any trust or estate assets, for
which advances with any interest the fiduciary shall have a lien on the
assets of the trust or estate as against a beneficiary.
(Added to NRS by 1969, 452)
A fiduciary may vote shares of stock
owned by the estate or any trust at stockholders’ meetings in person or
by special, limited or general proxy, with or without power of
substitution.
(Added to NRS by 1969, 452; A 1975, 446)
A fiduciary may hold
a security in the name of a nominee or in other form without disclosure
of the fiduciary relationship so that title to the security may pass by
delivery, but the fiduciary shall be liable for any act of the nominee in
connection with the stock so held.
(Added to NRS by 1969, 452)
A
fiduciary may:
1. Exercise all options, rights and privileges to convert stocks,
bonds, debentures, notes, mortgages or other property into other stocks,
bonds, debentures, notes, mortgages or other property;
2. Subscribe for other or additional stocks, bonds, debentures,
notes, mortgages or other property; and
3. Hold such stocks, bonds, debentures, notes, mortgages or other
property so acquired as investments of the estate or trust so long as the
fiduciary deems advisable.
(Added to NRS by 1969, 453)
A fiduciary may:
1. Unite with other owners of property similar to any which may be
held at any time in the decedent’s estate or in any trusts in carrying
out any plan for the consolidation or merger, dissolution or liquidation,
foreclosure, lease or sale of the property, incorporation or
reincorporation, reorganization or readjustment of the capital or
financial structure of any corporation, company or association the
securities of which may form any portion of an estate or trust;
2. Become and serve as a member of a stockholders or bondholders
protective committee;
3. Deposit securities in accordance with any plan agreed upon;
4. Pay any assessments, expenses or sums of money that may be
required for the protection or furtherance of the interest of the
distributees of an estate or beneficiaries of any trust with reference to
any such plan; and
5. Receive as investments of any estate or any trust any
securities issued as a result of the execution of such plan.
(Added to NRS by 1969, 453)
A fiduciary may reduce
the interest rate from time to time on any obligation, whether secured or
unsecured, constituting a part of an estate or trust.
(Added to NRS by 1969, 453)
A fiduciary may continue
any obligation, whether secured or unsecured, upon and after maturity
with or without renewal or extension upon such terms as the fiduciary
deems advisable, without regard to the value of the security, if any, at
the time of such continuance.
(Added to NRS by 1969, 453)
A fiduciary may:
1. Foreclose, as an incident to the collection of any bond, note
or other obligation, any mortgage, deed of trust or other lien securing
such bond, note or other obligation;
2. Bid in the property at such foreclosure sale, or acquire the
property by deed from the mortgagor or obligor without foreclosure; and
3. Retain the property so bid in or taken over without foreclosure.
(Added to NRS by 1969, 453)
A fiduciary may carry such insurance
coverage, including public liability, for such hazards and in such
amounts, either in stock companies or in mutual companies, as the
fiduciary deems advisable.
(Added to NRS by 1969, 453)
A fiduciary may collect, receive and
receipt for rents, issues, profits and income of an estate or trust.
(Added to NRS by 1969, 453)
A
fiduciary may compromise, adjust, arbitrate, sue on or defend, abandon or
otherwise deal with and settle claims in favor of or against the estate
or trust as the fiduciary deems advisable, and the fiduciary’s decision
shall be conclusive between the fiduciary and the beneficiaries of the
estate or trust and the person against or for whom the claim is asserted,
in the absence of fraud by such person, and, in the absence of fraud, bad
faith or gross negligence of the fiduciary, shall be conclusive between
the fiduciary and the beneficiaries of the estate or trust.
(Added to NRS by 1969, 453)
A fiduciary
may employ and compensate, out of income or principal or both and in such
proportion as the fiduciary deems advisable, persons deemed by the
fiduciary needful to advise or assist in the proper settlement of the
estate or administration of any trust, including, but not limited to,
agents, accountants, brokers, attorneys at law, attorneys-in-fact,
investment brokers, rental agents, realtors, appraisers and tax
specialists; and do so without liability for any neglect, omission,
misconduct or default of such agent or representative if he was selected
and retained with due care on the part of the fiduciary.
(Added to NRS by 1969, 454)
1. A fiduciary may:
(a) Acquire, receive, hold and retain the principal of several
trusts created by a single instrument undivided until division becomes
necessary in order to make distributions.
(b) Hold, manage, invest, reinvest and account for the several
shares or parts of shares by appropriate entries in the fiduciary’s books
of account, and allocate to each share or part of share its proportionate
part of all receipts and expenses.
2. The provisions of this section shall not defer the vesting in
possession of any share or part of share of the estate or trust.
(Added to NRS by 1969, 454)
1. A fiduciary may:
(a) Set up proper and reasonable reserves for taxes, assessments,
insurance premiums, depreciation, obsolescence, amortization, depletion
of mineral or timber properties, repairs, improvements and general
maintenance of buildings or other property out of rents, profits or other
income received; and
(b) Set up reserves also for the equalization of payments to or for
beneficiaries.
2. The provisions of this section shall not affect the ultimate
interests of beneficiaries in such reserves.
(Added to NRS by 1969, 454)
1. A fiduciary may:
(a) Make distribution of capital assets of the estate or trust in
kind or in cash, or partially in kind and partially in cash, in divided
or undivided interests, as the fiduciary finds to be most practicable and
for the best interests of the distributees; and
(b) Determine the value of capital assets for the purpose of making
distribution thereof if and when there is more than one distributee
thereof, which determination shall be binding upon the distributees
unless clearly capricious, erroneous and inequitable.
2. The fiduciary shall not exercise any power under this section
unless the fiduciary holds title to or an interest in the property to be
distributed and is required or authorized to make distribution thereof.
(Added to NRS by 1969, 454)
A
fiduciary may:
1. Make payments in money, or in property in lieu of money, to or
for a minor or incapacitated person in any one or more of the following
ways:
(a) Directly to the minor or incapacitated person.
(b) To apply directly in payment for the support, maintenance,
education and medical, surgical, hospital or other institutional care of
the minor or incapacitated person.
(c) To the legal or natural guardian of the minor or incapacitated
person.
(d) To any other person, whether or not appointed guardian of the
person by any court, who has, in fact, the care and custody of the person
of the minor or incapacitated person.
2. The fiduciary has no duty to see to the application of the
payments so made, if the fiduciary exercised due care in the selection of
the person, including the minor or incapacitated person, to whom the
payments were made, and the receipt of that person is full acquittance to
the fiduciary.
(Added to NRS by 1969, 454; A 1999, 2373 )
A fiduciary may determine:
1. What is principal and what is income of any estate or trust and
may allocate or apportion receipts and expenses as between principal and
income in the exercise of the fiduciary’s discretion, and, by way of
illustration and no limitation of the fiduciary’s discretion, may charge
premiums on securities purchased at a premium against principal or income
or partly against each.
2. Whether to apply stock dividends and other noncash dividends to
income or principal or apportion them as the fiduciary deems advisable.
3. What expenses, costs, taxes (other than estate, inheritance and
succession taxes) and other governmental charges shall be charged against
principal or income or apportioned between principal and income and in
what proportions.
(Added to NRS by 1969, 455)
A
fiduciary may make contracts and execute instruments, under seal or
otherwise, as may be necessary in the exercise of the powers herein
granted.
(Added to NRS by 1969, 455)
CHARITABLE TRUSTS
NRS 163.420 to 163.550 ,
inclusive, shall be known as the Charitable Trust Act of 1971.
(Added to NRS by 1971, 632)
The legislature hereby
declares that the policy of the State is to maximize the funds available
for charitable purposes by minimizing, to the greatest extent
practicable, the imposition of federal income and excise taxes upon trust
assets otherwise available for charitable purposes.
(Added to NRS by 1971, 632)
As used in NRS
163.420 to 163.550 , inclusive, unless otherwise indicated,
section references are to the Internal Revenue Code of 1986, as in effect
on January 1, 1999, and include future amendments to such sections and
corresponding provisions of future federal internal revenue laws.
(Added to NRS by 1971, 632; A 1999, 2374 )
As used in NRS 163.420 to 163.550 ,
inclusive, unless the context otherwise requires, the words and terms
defined in NRS 163.460 to 163.500
, inclusive, have the meanings ascribed
to them in NRS 163.460 to 163.500
, inclusive.
(Added to NRS by 1971, 632)
“Charitable trust” means
an organization described in Section 4947(a)(1).
(Added to NRS by 1971, 633)
“Private
foundation trust” means a trust as defined in Section 509(a), including a
trust described in Section 4947(a)(1).
(Added to NRS by 1971, 633)
“Split interest
trust” means a trust for individual and charitable beneficiaries as
defined in and subject to the provisions of Section 4947(a)(2).
(Added to NRS by 1971, 633)
“Trust” means an express trust
created by a trust instrument, including a last will and testament.
(Added to NRS by 1971, 633)
“Trustee” means a trustee,
trustees, person or persons possessing a power or powers referred to in
NRS 163.420 to 163.550 , inclusive.
(Added to NRS by 1971, 633)
The provisions of NRS 163.420 to 163.550 ,
inclusive, which are applicable to any of the trusts defined in NRS
163.460 to 163.500 , inclusive, apply to all trusts, whether they
were created before, on or after April 17, 1971.
(Added to NRS by 1971, 633)
1. In the administration of any private foundation trust, split
interest trust or charitable trust which is subject to the provisions of
the Internal Revenue Code of 1986, as in effect on January 1, 1999, the
following acts are prohibited:
(a) Engaging in any act or “self-dealing,” as defined in Section
4941(d), which would give rise to any liability for the tax imposed by
Section 4941(a);
(b) Retaining any “excess business holdings,” as defined in Section
4943(c), which would give rise to any liability for the tax imposed by
Section 4943(a);
(c) Making any investments which would jeopardize the carrying out
of any of the exempt purposes of the trust within the meaning of Section
4944, so as to give rise to any liability for the tax imposed by Section
4944(a); and
(d) Making any “taxable expenditures,” as defined in Section
4945(d), which would give rise to any liability for the tax imposed by
Section 4945(a).
2. This section does not apply to those split interest trusts or
amounts of such split interest trusts which are not subject to the
prohibitions applicable to private foundations by reason of the
provisions of Section 4947.
(Added to NRS by 1971, 633; A 1999, 2374 )
In the administration
of any trust which is a private foundation trust or a charitable trust,
there shall be distributed for the purposes specified in the trust
instrument, for each taxable year, amounts at least sufficient to avoid
liability for the tax imposed by Section 4942(a).
(Added to NRS by 1971, 633)
1. A court of this state having jurisdiction over any trust to
which NRS 163.420 to 163.550 , inclusive, apply may amend any trust
instrument to conform to the provisions of NRS 163.420 to 163.550 ,
inclusive.
2. Any such amendment must be effected by the trustee filing a
petition with the court. The clerk of the court shall set a date for the
hearing of the petition, and the trustee shall cause notice of the
hearing of the petition to be:
(a) Personally served on the settlor or settlors of the trust, if
living, and on all named beneficiaries of the trust, if any, for the
period and in the manner provided in NRS 155.010 ;
(b) Published on three dates of publication before the hearing, and
if the newspaper is published more than once each week, there must be at
least 10 days from the first to last date of publication, including both
the first and the last days; and
(c) Delivered, together with a copy of the petition, to the
Attorney General of the State of Nevada at the time of the filing of the
petition.
3. At the hearing of the petition, the court may authorize the
trustee to amend, revise, delete or add provisions to the trust
instrument to conform to NRS 163.420 to
163.550 , inclusive, to avoid the
penalties and liabilities described in Sections 4941(a), 4942(a),
4943(a), 4944(a) and 4945(a), but if the settlor or settlors of the trust
are living and competent to act, written consent of the settlor or
settlors must first be obtained.
(Added to NRS by 1971, 633; A 1999, 2374 )
In addition to amending,
revising, deleting or adding provisions to the articles of the trust to
conform to the sections set out in subsection 3 of NRS 163.540 , the petition may include a request, and the
court or judge may authorize any modifications, revisions, deletions or
additions to the term, or to the conditions and provisions of the
articles of any trust subject to the jurisdiction of the court, for the
trust to conform with the requirements for termination of private
foundation status as provided in Section 507, or in order to avoid the
tax provided in Section 507(c).
(Added to NRS by 1971, 634)
MISCELLANEOUS PROVISIONS
1. If the settlor of any trust specifically declares in the
instrument creating the trust that such trust is irrevocable it shall be
irrevocable for all purposes, even though the settlor is also the
beneficiary of such trust.
2. Such trust shall, under no circumstances, be construed to be
revocable for the reason that the settlor and beneficiary is the same
person.
(Added to NRS by 1973, 372)
Divorce or annulment of the marriage of
a settlor revokes every devise, beneficial interest or designation to
serve as trustee given by the settlor to the former spouse of the settlor
in a revocable inter vivos trust executed before the entry of the decree
of divorce or annulment unless otherwise:
1. Provided in a property or separation agreement that is approved
by the court in the divorce or annulment proceedings; or
2. Ordered by the court in the divorce or annulment proceedings,
Ê and the revocable inter vivos trust provisions take effect in the same
manner as if the spouse had predeceased the trustor.
(Added to NRS by 2003, 342 )
A trustee may:
1. Join with a decedent’s surviving spouse or the personal
representative of the decedent’s estate in the execution and filing of a
joint income tax return for any period before the decedent’s death for
which the decedent had not filed an income tax or gift tax return on
gifts made by the spouse;
2. Consent to treat such gifts as having been made one-half by the
decedent for any period before his death; and
3. Pay such taxes thereon as are chargeable to the decedent.
(Added to NRS by 1979, 455; A 1999, 2375 )
A third person who acts in good faith is not bound to
ensure the proper application of trust property paid or delivered to a
trustee.
(Added to NRS by 1999, 2366 )
1. Whether or not the provisions relating to electronic trusts
apply, a trust may refer to a written statement or list, including,
without limitation, a written statement or list contained in an
electronic record, to dispose of items of tangible personal property not
otherwise specifically disposed of by the trust, other than money,
evidences of indebtedness, documents of title, securities and property
used in a trade or business.
2. To be admissible as evidence of the intended disposition, the
statement or list must contain:
(a) The date of its execution.
(b) A title indicating its purpose.
(c) A reference to the trust to which it relates.
(d) A reasonably certain description of the items to be disposed of
and the beneficiaries.
(e) The handwritten signature or electronic signature of the
settlor.
3. The statement or list may be:
(a) Referred to as a writing to be in existence at the death of the
settlor.
(b) Prepared before or after the execution of the trust instrument.
(c) Altered by the settlor after its preparation.
(d) A writing which has no significance apart from its effect upon
the dispositions made by the trust.
(Added to NRS by 1999, 2366 ; A 2001, 2351 )
