New Rights for Trust Beneficiaries

October 14, 2008

Previously under Pennsylvania law, it was possible for a person to be a beneficiary of a trust and be unaware of the existence of the trust. This lack of information was particularly disturbing because protections for the beneficiaries generally depended upon the vigilance of the beneficiary to enforce his or her rights. 

Under the relatively new Pennsylvania Uniform Trust Act, trustees of Pennsylvania trusts have until November 6, 2008 to comply with the new notice requirements to send information about certain trusts, their investments and provisions.

The Act applies only to trusts that are funded and those where the terms are not going to change. Accordingly, the revocable trusts that are frequently used in estate planning would not be affected as long as the Settlor, the creator of the trust, is alive and competent. 

The events that trigger the sending of notices are as follows:

  1. The death of the Settlor.
  2. New current beneficiaries, for example, a beneficiary taking a deceased beneficiaries’ share. The term "current beneficiary" is a person who is 18 years of age or older to or for whom income or principal of a trust must be distributed currently, or a person 25 years of age or older, to or for whom income or principal may, in the trustee’s discretion, be distributed currently.
  3. The change of trustee for an irrevocable trust.
  4. The incapacity of the Settlor.
  5.  Beneficiaries who "opt-in" which includes persons who sent the trustee a written request for notice.

 The notice must include the following:

  1. The trust’s existence.
  2. The identity of the Settlor.
  3. The trustee’s name, address and telephone number.
  4. The beneficiary’s right to receive upon request a copy of the trust. 
  5. The beneficiary’s right to receive upon request a written report of the trust’s assets and their market values (if that is possible).
  6. The trust’s liabilities and the trust’s receipts and disbursements since the date of the last report.