SB-0979, As Passed House, December 12, 2012
February 23, 2012, Introduced by Senators SCHUITMAKER and JONES and referred to the Committee on Judiciary.
A bill to amend 2008 PA 148, entitled
"Personal property trust perpetuities act,"
by amending sections 2 and 3 (MCL 554.92 and 554.93).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. As used in this act:
(a) "Fiduciary" means, with respect to a power of appointment,
that the power is held by a trustee in a fiduciary capacity.
(b) (a)
"First power" means a
nonfiduciary, nongeneral power
of appointment over personal property held in trust that is
exercised so as to subject the property to, or to create, another
power of appointment.
(c) (b)
"Nonfiduciary" means,
with respect to a power of
appointment, that the power of appointment is not held by a trustee
in a fiduciary capacity.
(d) "Second-order fiduciary power" means a fiduciary power of
appointment that is created or has property subjected to it by the
exercise of 1 of the following:
(i) A first power.
(ii) A fiduciary power of appointment that was created or had
property subjected to it by the exercise of a first power.
(iii) A fiduciary power of appointment whose creation or control
over property subject to the power is traceable through a
succession of previous exercises of fiduciary powers to the
exercise of a fiduciary power that was created or had property
subjected to it by the exercise of a first power.
(e) (c)
"Second power" means a nonfiduciary
power of
appointment over personal property held in trust, other than a
presently exercisable general power, that is created or to which
property
is subjected by the exercise of either
a first power and
that
is not a presently exercisable general power.or a second-order
fiduciary power.
(f) (d)
"Uniform statutory rule
against perpetuities" means
the uniform statutory rule against perpetuities, 1988 PA 418, MCL
554.71 to 554.78.
Sec. 3. (1) Except as provided in subsection (3), an interest
in, or power of appointment over, personal property held in trust
is not invalidated by a rule against any of the following:
(a) Perpetuities.
(b) Suspension of absolute ownership.
(c) Suspension of the power of alienation.
(d) Accumulations of income.
(2) Except as provided in subsection (3), all of the following
may be indefinitely suspended, postponed, or allowed to go on with
respect to personal property held in trust:
(a) The vesting of a future interest.
(b) The satisfaction of a condition precedent to the exercise
of a general power of appointment.
(c) The exercise of a nongeneral or testamentary power of
appointment.
(d) Absolute ownership.
(e) The power of alienation.
(f) Accumulations of income.
(3)
If a first power is exercised so as to subject the
property
to, or to create, a second power, the The period during
which
the vesting of a future interest in the property may be
postponed
by the exercise of the a second power shall be determined
under the uniform statutory rule against perpetuities by reference
to
the time of the creation of the first power was of appointment
that subjected property to, or created, the second power. A
nonvested interest, general power of appointment not presently
exercisable because of a condition precedent, or nongeneral or
testamentary power of appointment created, or to which property is
subjected, by the exercise of the second power is invalid, to the
extent of the exercise of the second power, unless the interest or
power satisfies the uniform statutory rule against perpetuities
measured
from the time of the creation of the first power of
appointment that subjected property to, or created, the second
power.