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HF 951

as introduced - 87th Legislature (2011 - 2012) Posted on 03/09/2011 09:23am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to probate; changing, updating, and clarifying certain provisions of the
Uniform Disclaimer of Property Interests Act; amending Minnesota Statutes
2010, sections 524.2-1103; 524.2-1104; 524.2-1106; 524.2-1107; 524.2-1114;
524.2-1115; 524.2-1116.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2010, section 524.2-1103, is amended to read:


524.2-1103 SCOPE.

Sections deleted text begin 524.2-1101 to 524.2-1116 apply to disclaimers of any interest in or power
over property, whenever created. Except as provided in section 524.2-1116, sections
deleted text end 524.2-1101 to 524.2-1116 are the exclusive means by which a disclaimer may be made
under Minnesota law regardless of whether it is qualified under section 2518 of the
Internal Revenue Code of 1986 deleted text begin in effect on January 1, 2010deleted text end new text begin as defined in section 291.005,
subdivision 1, clause 3
new text end .

Sec. 2.

Minnesota Statutes 2010, section 524.2-1104, is amended to read:


524.2-1104 TAX-QUALIFIED DISCLAIMER.

Notwithstanding any other provision of this chapter, other than section 524.2-1106,
if, as a result of a disclaimer or transfer, the disclaimed or transferred interest is treated
pursuant to the provisions of section 2518 of the Internal Revenue Code of 1986, as deleted text begin in
effect on January 1, 2010
deleted text end new text begin defined in section 291.005, subdivision 1, clause 3new text end , as never
having been transferred to the disclaimant, then the disclaimer or transfer is effective as a
disclaimer under sections 524.2-1101 to 524.2-1116.

Sec. 3.

Minnesota Statutes 2010, section 524.2-1106, is amended to read:


524.2-1106 WHEN DISCLAIMER IS BARRED OR LIMITED.

(a) A disclaimer is barred by a written waiver of the right to disclaim.

(b) A disclaimer of an interest in property is barred if any of the following events
occur before the disclaimer becomes effective:

(1) the disclaimant accepts the portion of the interest sought to be disclaimed;

(2) the disclaimant voluntarily assigns, conveys, encumbers, pledges, or transfers the
portion of the interest sought to be disclaimed or contracts to do so;

(3) the portion of the interest sought to be disclaimed is sold pursuant to a judicial
sale; or

(4) the disclaimant is insolvent when the disclaimer becomes irrevocable.

new text begin (c) Acceptance of a distribution from a trust shall constitute acceptance of only
that portion of the beneficial interest in that trust that has been distributed, and shall not
constitute acceptance or bar disclaimer of that portion of the beneficial interest in the trust
that has not yet been distributed.
new text end

deleted text begin (c)deleted text end new text begin (d)new text end A disclaimer, in whole or in part, of the future exercise of a power held in a
fiduciary capacity is not barred by its previous exercise.

deleted text begin (d)deleted text end new text begin (e)new text end A disclaimer, in whole or in part, of the future exercise of a power not held in
a fiduciary capacity is not barred by its previous exercise unless the power is exercisable
in favor of the disclaimant.

deleted text begin (e)deleted text end new text begin (f)new text end A disclaimer of an interest in, or a power over, property which is barred by
this section is ineffective.

Sec. 4.

Minnesota Statutes 2010, section 524.2-1107, is amended to read:


524.2-1107 POWER TO DISCLAIM; GENERAL REQUIREMENTS; WHEN
IRREVOCABLE.

(a) A person may disclaim, in whole or in part, any interest in or power over
property, including a power of appointment. A person may disclaim the interest or power
even if its creator imposed a spendthrift provision or similar restriction on transfer or a
restriction or limitation on the right to disclaim.

(b) With court approval, a fiduciary may disclaim, in whole or in part, any interest in
or power over property, including a power of appointment when acting in a representative
capacity. Without court approval, a fiduciary may disclaim, in whole or in part, any interest
in or power over property, including a power of appointment, if and to the extent that the
instrument creating the fiduciary relationship explicitly grants the fiduciary the right to
disclaim. With court approval, a custodial parent may disclaim on behalf of a minor child
for whom no conservator has been appointed, in whole or in part, any interest in or power
over property, including a power of appointment, which the minor child is to receive.

(c) To be effective, a disclaimer must be in writing, declare the writing as a
disclaimer, describe the interest or power disclaimed, and be signed by the person or
fiduciary making the disclaimer and acknowledged in the manner provided for deeds of
real estate to be recorded in this state. In addition, for a disclaimer to be effective, an
original of the disclaimer must be delivered or filed in the manner provided in section
524.2-1114.

(d) A partial disclaimer may be expressed as a fraction, percentage, monetary
amount, new text begin specific property, new text end term of years, new text begin portion of a beneficial interest in or right to
distributions from a trust,
new text end limitation of a power, or any other interest or estate in the
property.

(e) A disclaimer becomes irrevocable when the disclaimer is delivered or filed
pursuant to section 524.2-1114 or it becomes effective as provided in sections 524.2-1108
to 524.2-1113, whichever occurs later.

(f) A disclaimer made under sections 524.2-1101 to 524.2-1116 is not a transfer,
assignment, or release.

Sec. 5.

Minnesota Statutes 2010, section 524.2-1114, is amended to read:


524.2-1114 DELIVERY OR FILING.

(a) Subject to paragraphs (b) to (l), delivery of a disclaimer may be effective
by personal delivery, first-class mail, or any other method that results in its receipt.
A disclaimer sent by first-class mail is deemed to have been delivered on the date it is
postmarked. Delivery by any other method is effective upon receipt by the person to
whom the disclaimer is to be delivered under this section.

(b) In the case of a disclaimer of an interest created under the law of intestate
succession or an interest created by will, other than an interest in a testamentary trust:

(1) the disclaimer must be delivered to the personal representative of the decedent's
estate; or

(2) if no personal representative is serving when the disclaimer is sought to be
delivered, the disclaimer must be filed with the clerk of the court in any county where
venue of administration would be proper.

(c) In the case of a disclaimer of an interest in a testamentary trust:

(1) the disclaimer must be delivered to the trustee serving when the disclaimer is
delivered or, if no trustee is then serving, to the personal representative of the decedent's
estate; or

(2) if no personal representative is serving when the disclaimer is sought to be
delivered, the disclaimer must be filed with the clerk of the court in any county where
venue of administration of the decedent's estate would be proper.

(d) In the case of a disclaimer of an interest in an inter vivos trust:

(1) the disclaimer must be delivered to the trustee serving when the disclaimer is
delivered;

(2) if no trustee is then serving, it must be filed with the clerk of the court in any
county where the filing of a notice of trust would be proper; or

(3) if the disclaimer is made before the time the instrument creating the trust becomes
irrevocable, the disclaimer must be delivered to the person with the power to revoke the
revocable trust or the transferor of the interest or to such person's legal representative.

(e) In the case of a disclaimer of an interest created by a beneficiary designation made
before the time the designation becomes irrevocable, the disclaimer must be delivered to
the person making the beneficiary designation or to such person's legal representative.

(f) In the case of a disclaimer of an interest created by a beneficiary designation
made after the time the designation becomes irrevocable, the disclaimer must be delivered
to the person obligated to distribute the interest.

(g) In the case of a disclaimer by a surviving holder of jointly held property, the
disclaimer must be delivered to the person to whom the disclaimed interest passes or, if
such person cannot reasonably be located by the disclaimant, the disclaimer must be
delivered as provided in paragraph (b).

(h) In the case of a disclaimer by an object, or taker in default of exercise, of a
power of appointment at any time after the power was created, the disclaimer must be
delivered to:

(1) the holder of the power; or

(2) the fiduciary acting under the instrument that created the power or, if no fiduciary
is serving when the disclaimer is sought to be delivered, filed with a court having authority
to appoint the fiduciary.

(i) In the case of a disclaimer by an appointee of a nonfiduciary power of
appointment, the disclaimer must be delivered to:

(1) the holder of the power or the personal representative of the holder's estate; or

(2) the fiduciary under the instrument that created the power or, if no fiduciary is
serving when the disclaimer is sought to be delivered, filed with a court having authority
to appoint the fiduciary.

(j) In the case of a disclaimer by a fiduciary of a power over a trust or estate, the
disclaimer must be delivered as provided in paragraph (b), (c), or (d) as if the power
disclaimed were an interest in property.

(k) In the case of a disclaimer of a power exercisable by an agent, other than a power
exercisable by a fiduciary over a trust or estate, the disclaimer must be delivered to the
principal or the principal's representative.

(l) Notwithstanding paragraph (a), delivery of a disclaimer of an interest in or
relating to real estate shall be presumed upon the recording of the disclaimer in the office
of the deleted text begin clerk of the courtdeleted text end new text begin county recorder or registrar of titles new text end of the county or counties
where the real estate is located.

(m) A fiduciary or other person having custody of the disclaimed interest is not
liable for any otherwise proper distribution or other disposition made without actual
notice of the disclaimer or, if the disclaimer is barred under section 524.2-1106, for any
otherwise proper distribution or other disposition made in reliance on the disclaimer, if
the distribution or disposition is made without actual knowledge of the facts constituting
the bar of the right to disclaim.

Sec. 6.

Minnesota Statutes 2010, section 524.2-1115, is amended to read:


524.2-1115 RECORDING OF DISCLAIMER RELATING TO REAL ESTATE.

(a) A disclaimer of an interest in or relating to real estate does not provide
constructive notice to all persons unless the disclaimer contains a legal description of the
real estate to which the disclaimer relates and unless the disclaimer is deleted text begin filed for recordingdeleted text end new text begin
recorded
new text end in the office of the county recorder new text begin or registrar of titles new text end in the county or counties
where the real estate is located.

(b) An effective disclaimer meeting the requirements of paragraph (a) constitutes
constructive notice to all persons from the time of deleted text begin filingdeleted text end new text begin recordingnew text end . Failure to record the
disclaimer does not affect its validity as between the disclaimant and persons to whom the
property interest or power passes by reason of the disclaimer.

Sec. 7.

Minnesota Statutes 2010, section 524.2-1116, is amended to read:


524.2-1116 APPLICATION TO EXISTING RELATIONSHIPS.

deleted text begin Except as otherwise provided in section 524.2-1106, andeleted text end new text begin Sections 524.2-1101 to
524.2-1116 apply to disclaimers of any
new text end interest in or power over property existing on
January 1, 2010, deleted text begin as to which the time for delivering or filing a disclaimer under laws
superseded by sections 524.2-1101 to 524.2-1116 has not expired, may be disclaimed
after January 1, 2010
deleted text end new text begin whenever creatednew text end .