HB-6693, As Passed House, December 6, 2006
November 30, 2006, Introduced by Rep. Schuitmaker and referred to the Committee on Judiciary.
A bill to amend 1988 PA 418, entitled
"Uniform statutory rule against perpetuities,"
by amending sections 2 and 5 (MCL 554.72 and 554.75).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
2. (1) A nonvested property interest in real property
is invalid unless 1 or more of the following are applicable to the
interest:
(a) 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.
(b) The interest either vests or terminates within 90 years
after its creation.
(2) A general power of appointment not presently exercisable
because of a condition precedent is invalid unless 1 or more of the
following are applicable to the power:
(a) When the power is created, the condition precedent is
certain either to be satisfied or become impossible to satisfy no
later than 21 years after the death of an individual then alive.
(b) The condition precedent either is satisfied or becomes
impossible to satisfy within 90 years after its creation.
(3) A nongeneral power of appointment or a general
testamentary power of appointment is invalid unless 1 or more of
the following are applicable to the power:
(a) 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.
(b) The power is irrevocably exercised or otherwise terminates
within 90 years after its creation.
(4) In determining whether a nonvested property interest or a
power of appointment is valid under subsection (1)(a), (2)(a), or
(3)(a), the possibility that a child will be born to an individual
after the individual's death is disregarded.
(5) This section does not apply to interests in personal
property.
Sec. 5. Section 2 shall not apply to any of the following:
(a) A nonvested property interest or a power of appointment
arising out of a nondonative transfer, except a nonvested property
interest or a power of appointment arising out of a premarital or
postmarital agreement; a separation or divorce settlement; a
spouse's election; a similar arrangement arising out of a
prospective, existing, or previous marital relationship between the
parties; a contract to make or not to revoke a will or trust; a
contract to exercise or not to exercise a power of appointment; a
transfer in satisfaction of a duty of support; or a reciprocal
transfer.
(b) A fiduciary's power relating to the administration or
management of assets, including the power of a fiduciary to sell,
lease, or mortgage property, and the power of a fiduciary to
determine principal and income.
(c) A power to appoint a fiduciary.
(d) A discretionary power of a trustee to distribute principal
before termination of a trust to a beneficiary having an
indefeasibly vested interest in the income and principal.
(e) A property interest, power of appointment, or any other
arrangement that was not subject to the common-law rule against
perpetuities or is excluded by another statute.
(f) An interest in personal property.