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Florida Electronic Wills Act Removes Benefit-of-the-Beneficiary Rule

Posted on: June 7th, 2017
legislationThe Florida Electronic Wills Act (House Bill 277) takes effect July 1, 2017. The legislation has garnered wide attention as it will make Florida the second jurisdiction in the nation to legalize use of electronic wills. While this has been the focus of the Act, further amendments to the law are included that also affect trusts.

Several provisions in the Act directly address the testamentary matters of revocable trusts. When the Act becomes law next month, the Florida Trust Code will be revised. As of this writing, the Florida Trust Code includes a statute that states “A trust and its terms must be for the benefit of its beneficiaries.” This benefit-of-the-beneficiary rule is completely removed in the new law.

The new legislation includes the addition of a statute that broadens the scope of the settlor’s intent. The new provisions clarify this with Subsection (11) of Section 736.0103: “’Interests of the beneficiaries’ means the beneficial interests intended by the settlor as provided in the terms of a trust.” (Added items noted in italics.) 

Beyond the removal of the benefit-of-the-beneficiary rule, the new law includes several provisions that address disabled trust beneficiaries, supplemental needs trusts, trust accountings, and trustee powers, among other items. These changes should prompt review of existing trusts as well as trust administration duties of active trustees. 

The forthcoming changes will affect how trust provisions will be enforced. It remains to be seen to what degree the trust code provisions will impact trust administration and trust litigation.

While the Act becomes effective July 1, 2017, some provisions take effect April 1, 2018. Read the full text of the bill and review with a Florida trust attorney to learn how the law applies to existing trusts.
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