Private Clients Alert
August 2008
Authors:
Andrew L. Gespass
+1.412.355.8664
andrew.gespass@klgates.com
Charles F. Pegher
+1.412.355.6509
charles.pegher@klgates.com
Scott E. Mooney
+1.412.355.8361
scott.mooney@klgates.com
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Pennsylvania Law of Trusts Commentary
Discharging a Trustee’s Duty to Inform and Report
under Pennsylvania’s Uniform Trust Act
Introduction
Some of our clients may be impacted by a recent Pennsylvania trust act. If you are currently
serving as a trustee, or are a beneficiary, of a Pennsylvania trust, these rules may have
relevance to you.
Under Pennsylvania’s recently enacted Uniform Trust Act (“UTA”), a trustee of a
Pennsylvania trust is now required to provide trust beneficiaries with notice of the trust’s
existence and certain other information. In some cases, the deadline for providing such
notice and information is November 6, 2008. Trust beneficiaries have a corresponding right
to receive certain information regarding the trust and its administration.
The UTA, enacted in 2006 and codified in Chapter 77 of the Pennsylvania Probate, Estates
& Fiduciaries Code (“PEF Code”), imposes on trustees a duty to provide certain information
to trust beneficiaries under prescribed circumstances (i.e., the trustee’s duty to inform and
report under PEF Code § 7780.3).1 Generally, in connection with triggering events that
occurred before November 6, 2006, a trustee must provide prescribed information to trust
beneficiaries no later than November 6, 2008; and in connection with triggering events
that occur on or after November 6, 2006, a trustee must provide prescribed information to
trust beneficiaries within 30 days of learning of a triggering event.
This Alert summarizes the provisions of PEF Code § 7780.3. This Alert is only a summary
and not intended to be comprehensive. We refer you to the legislation and official
commentary for more detail, and we would be pleased to answer any questions.
A Trustee’s Duty to Inform and Report under PEF Code § 7780.3
Except for a revocable trust the settlor of which is still living and competent, a trustee
must respond to a beneficiary’s reasonable request for trust administration information.2 In
addition, a trustee of a trust must provide notice of (i) the trust’s existence, (ii) the identity
of the trust’s settlor, (iii) the trustee’s name, address and telephone number, (iv) the notice
recipient’s right to receive a copy of the trust instrument and (v) the notice recipient’s right
to receive annual reports of the trust’s assets (including their fair market values), liabilities,
receipts and disbursements since the date of the last report, to the following persons and
within 30 days of learning of the following triggering events:
• Adjudication of incapacity of the settlor of a revocable trust: the settlor’s
guardian;
• Death of the settlor of a revocable trust: the settlor’s personal representative (i.e., executor or executrix), spouse and children and the trust’s “current beneficiaries”;3
1 The PEF Code is Title 20 of the Pennsylvania Consolidated Statutes.
2 A trust’s creator is sometimes called “settlor,” “grantor,” or “donor.”
3 A “current beneficiary” of a trust is (i) any person who is at least 18 years old and to whom trust income or
principal must be distributed currently or (ii) any person who is at least 25 years old and to whom trust income
or principal may, in the trustee’s discretion, be distributed currently.
Private Clients Alert
•
Adjudication of incapacity or death of the
settlor of an irrevocable trust: the trust’s
current beneficiaries (unless, in the case of
the settlor’s death, the trustee provided
notice in connection with a prior adjudication
of incapacity);
•
A person who did not previously receive notice
as described in (iii) becomes a current
beneficiary of an irrevocable trust: such
current beneficiary; and
• Change in trustee: current beneficiaries.
A settlor may, in the trust instrument, designate one or
more persons to receive the required notice on behalf
of named current beneficiaries. Any beneficiary may
waive (and revoke a waiver of) the right to receive
notice.
Generally, a trustee must comply with the notice
requirements by November 6, 2008, except for the
notice requirements described in (i) through (iii) in the
case of a settlor’s death or adjudicated incapacity on
or after November 6, 2006 (in which case compliance
is required within 30 days of the trustee’s learning of
the settlor’s death or the adjudication).
If you have any questions about this Alert, please
contact Andrew Gespass (412.355.8664 / andrew.
gespass@klgates.com), Buzz Hutchison (412.355.6452
/ stuart.hutchison@klgates.com), Walter Lannis
(412.355.6345 / walter.lannis@klgates.com), Charles
Pegher (412.355.6509 / charles.pegher@klgates.
com), Paul Schwendeman (412.355.6570 / paul.
schwendeman@klgates.com), Barbara Simanek
(412.355.8674 / barbara.simanek@klgates.com), Scott
Mooney (412.355.8361 / scott.mooney@klgates.com),
Martha Nepa (412.355.6273 / martha.nepa@klgates.
com) or Christina Burke (412.355.8690 / christina.
burke@klgates.com)
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