North Carolina § 36C-11-1106 - Application to existing relationships.

§ 36C-11-1106. Application to existing relationships.

Except as otherwise provided in this Chapter, this Chapter applies to (i) all trusts created before, on, or after January 1, 2006; (ii) all judicial proceedings concerning trusts commenced on or after January 1, 2006; and (iii) judicial proceedings concerning trusts commenced before January 1, 2006, unless the court finds that application of a particular provision of this Chapter would substantially interfere with the effective conduct of the judicial proceedings or prejudice the rights of the parties, in which case the particular provision of this Chapter does not apply and the superseded law applies. Except as otherwise provided in this Chapter, any rule of construction or presumption provided in this Chapter applies to trust instruments executed before January 1, 2006, unless there is a clear indication of a contrary intent in the terms of the trust or unless application of that rule of construction or presumption would impair substantial rights of a beneficiary. Except as otherwise provided in this Chapter, an act done before January 1, 2006, is not affected by this Chapter. If a right is acquired, extinguished, or barred upon the expiration of a prescribed period that has commenced to run under any other statute before January 1, 2006, that statute continues to apply to the right even if it has been repealed or superseded. History (2005-192, ss. 7(a), (b); 2006-226, ss. 31(a), (b).) Official Comment on Effective Date and Applicability. - The Uniform Trust Code is intended to have the widest possible effect within constitutional limitations. Specifically, the Code applies to all trusts whenever created, to judicial proceedings concerning trusts commenced on or after its effective date, and unless the court otherwise orders, to judicial proceedings in progress on the effective date. In addition, any rules of construction or presumption provided in the Code apply to preexisting trusts unless there is a clear indication of a contrary intent in the trust's terms. By applying the Code to preexisting trusts, the need to know two bodies of law will quickly lessen. This Code cannot be fully retroactive, however. Constitutional limitations preclude retroactive application of rules of construction to alter property rights under trusts that became irrevocable prior to the effective date. Also, rights already barred by a statute of limitation or rule under former law are not revived by a possibly longer statute or more liberal rule under this Code. Nor is an act done before the effective date of the Code affected by the Code's enactment. The Uniform Trust Code contains an additional effective date provision. Pursuant to Section 602(a), prior law will determine whether a trust executed prior to the effective date of the Code is presumed to be revocable or irrevocable. For a comparable uniform law effective date provision, see Uniform Probate Code § 8-101. North Carolina Comment on Effective Date and Applicability. - The drafters modified the provisions of the Uniform Trust Code relating to its application to trust instruments executed before its effective date by adding the phrase "or unless application of that rule of construction or presumption would impair substantial rights of a beneficiary" to the end of the first sentence of the second paragraph. Although this Chapter is intended to have broad application, the drafters concluded that a rule of construction or presumption provided in this Chapter should not be applied to a trust instrument executed before the effective date of this Chapter if the application of such rule or presumption would impair the substantial rights of a beneficiary of a trust established under such a trust instrument. Editor's Note. - Session Laws 2006-226, s. 31(c), provides: "The Revisor of Statutes is authorized to cause to be printed along with G.S. 36C-11-1106 , as enacted by this section, all relevant portions of the Official Commentary to this section of the Uniform Trust Code and all explanatory comments of the drafters as the Revisor deems appropriate." Effect of Amendments. - Session Laws 2005-192, s. 7(a), as codified by Session Laws 2006-226, s. 31(a), effective August 10, 2006, rewrote the section.