New Hampshire § 564-B-4-406 - Section 564-B:4-406 Validity of Trusts.

§ 564-B-4-406. Section 564-B:4-406 Validity of Trusts.

(a) A trust is void to the extent that it was not validly created in accordance with this chapter or its creation was induced by fraud, duress, or undue influence. (b) A person may commence a judicial proceeding to contest the validity of a trust within the earlier of: (1) in the case of a trust that was revocable at the settlor's death, 3 years after the settlor's death; (2) in the case of an irrevocable trust, including a formerly revocable trust that has become irrevocable, 3 years after the trustee sent to the beneficiary a notice described in RSA 564-B:8-813(c)(3); or (3) in the case of an irrevocable trust, including a trust that was revocable at the settlor's death or a formerly revocable trust that has become irrevocable, 180 days after the trustee sent the person a copy of the trust instrument and a notice informing the person of the trust's existence, the trustee's name, address, and telephone number, and the time allowed for commencing a proceeding to contest the validity of a trust. (c) A trustee may send the notice described in subsection (b)(3) for purposes of commencing the 180-day limitation period, but the trustee does not have a duty to do so. A trustee shall not be liable to any person for not sending the notice described in subsection (b)(3). (d) During his or her life, a settlor may commence a judicial proceeding to determine the validity of a trust that he or she created, subject only to the trust's subsequent amendment or revocation if the trust is revocable. (1) The trust instrument must expressly provide that this state's laws govern the trust's validity, interpretation, and administration, and the trust must have its principal place of administration within this state. (2) The venue for the judicial proceeding is in the county where the trust has its principal place of administration. (3) In addition to the settlor, each of the following persons is an interested person in the judicial proceeding: (A) the settlor's spouse; (B) the persons who, if the settlor had died on the date of filing the petition, would be the settlor's heirs; (C) the qualified beneficiaries; (D) the trustees, trust advisors, and trust protectors; (E) if the trust is wholly or partially a charitable trust, the director of charitable trusts; (F) if the trust is a trust for the care of an animal under RSA 564-B:4-408, the persons who, under the terms of the trust, have the power to enforce the trust; (G) if the trust is a trust authorized under RSA 564-B:4-409, the persons who, under the terms of the trust, have the power to enforce the trust; and (H) any other persons who would be an interested person in a judicial proceeding to determine the validity of the trust. (4) In the case of a revocable trust, the qualified beneficiaries and other interested persons shall be determined as if the trust was irrevocable on the date of filing the petition, and each of the qualified beneficiaries and other interested persons shall be deemed possessed of inchoate property rights. (5) Notice shall be given to each of the interested persons. The court may order notice be given to other persons. (6) After a hearing, the court shall declare whether the trust is valid or invalid, and it may make other findings of fact and conclusions of law that are appropriate under the circumstances. (7) A trust for which there is a declaration of validity under this subsection may be modified or revoked in the same manner as a trust for which there is no declaration of validity under this subsection. (8) A settlor's failure to commence a judicial proceeding under this subsection shall not be construed as evidence or as an admission that the trust is invalid for any reason. (e) A trustee may proceed to distribute the trust property in accordance with the terms of the trust even though the period for contesting the validity of the trust has not expired. The trustee is not subject to liability for doing so unless: (1) the trustee knows of a pending judicial proceeding contesting the validity of the trust; or (2) a potential contestant has notified the trustee of a possible judicial proceeding to contest the trust and a judicial proceeding is commenced within 60 days after the contestant sent the notification. (f) A beneficiary of a trust that is determined to have been invalid is liable to return any distribution received. (g) If the laws of this state govern a trust's validity and the trust has its principal place of administration in this state, then the trust and any transfer of property by a settlor to the trust shall not be void or voidable for either of the following reasons: (1) The laws of a foreign jurisdiction prohibit or do not recognize the concept of a trust; or (2) The trust or the transfer defeats any forced heirship, legitime, forced share, or any similar heirship right under the laws of a foreign jurisdiction.