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LRB095 05934 AJO 49059 a |
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| Section shall be considered to be a restriction on the transfer |
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| of the settlor's beneficial interest in the trust that is |
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| enforceable under applicable nonbankruptcy law within the |
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| meaning of Section 541(c)(2) of the Bankruptcy Code or any |
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| successor provision. |
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| (b) (1) If the settlor is a beneficiary of the trust, at |
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| least one trustee of a trust described in this Section must be |
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| a corporate fiduciary authorized by the laws of this State to |
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| act as a trustee and whose activities are subject to |
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| supervision by the Director of the Division of Banking of this |
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| State, the Office of the Comptroller of the Currency, or the |
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| Office of Thrift Supervision, or any successor thereto; and |
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| (2) maintains or arranges for custody in this State of |
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| some or all of the property that is the subject of the |
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| trust described in this Section, maintains records for the |
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| trust on an exclusive or nonexclusive basis, prepares or |
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| arranges for the preparation of fiduciary income tax |
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| returns for the trust, or otherwise materially |
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| participates in the administration of the trust. |
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| (c) (1) Except as provided in this subsection, if a trust |
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| has a restriction as provided in subsection (a) of this |
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| Section, a creditor or other claimant of the settlor may not |
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| satisfy a claim, or liability on a claim, in either law or |
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| equity, out of the settlor's transfer or the settlor's |
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| beneficial interest in the trust. For purposes of this Section, |
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| a creditor includes one holding or seeking to enforce a |
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09500SB2725sam002 |
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LRB095 05934 AJO 49059 a |
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| judgment entered by a court or other body having adjudicative |
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| authority as well as one with a right to payment, whether or |
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| not reduced to judgment, liquidated, unliquidated, fixed, |
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| contingent, matured, unmatured, disputed, undisputed, legal, |
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| equitable, secured, or unsecured. |
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| (2) A trust described in this Section does not prevent |
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| a creditor or person described in this subsection (c) from |
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| satisfying a claim or liability out of the settlor's |
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| beneficial interest in or transfer into trust if: |
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| (i) the claim is a judgment, order, decree, or |
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| other legally enforceable decision or ruling resulting |
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| from a judicial, arbitration, mediation, or |
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| administrative proceeding commenced prior to or within |
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| 3 years after the trust is created; |
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| (ii) the settlor's transfer into trust is made with |
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| actual intent to hinder, delay, or defraud that |
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| creditor or claimant; |
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| (iii) the trust provides that the settlor may |
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| revoke or terminate all or part of the trust; |
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| (iv) the claim is for a payment owed by the settlor |
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| under a child support judgment or order; |
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| (v) the claim is by a spouse or former spouse of |
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| the settlor on account of an agreement or court order |
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| for the payment of support or maintenance or for a |
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| division or distribution of property; |
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| (vi) the claim is a tax or other amount owed by the |
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LRB095 05934 AJO 49059 a |
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| settlor to any governmental entity; |
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| (vii) the claim is by a governmental entity for |
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| recovery of public assistance received by the settlor |
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| from the governmental entity; |
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| (viii) the transfer is made when the settlor is |
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| insolvent or the transfer renders the settlor |
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| insolvent; |
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| (ix) the claim is a judgment, award, order, |
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| sentence, fine, penalty, or other determination of |
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| liability of the settlor for conduct of the settlor |
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| constituting fraud, intentional infliction of harm, or |
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| a crime; or |
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| (x) the settlor transferred assets into the trust |
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| that: (1) were listed in a written representation of |
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| the settlor's assets given to a claimant to induce the |
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| claimant to enter into a transaction or agreement with |
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| the settlor; or (2) were transferred from the settlor's |
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| control in breach of any written agreement, covenant, |
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| or security interest between the settlor and the |
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| claimant. |
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| (d) The statute of limitations for actions to satisfy a |
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| claim or liability out of the settlor's beneficial interest in |
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| or transfer into trust under this Section is the statute of |
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| limitations applicable to the underlying action. |
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| (e) The satisfaction of a claim under this Section is |
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| limited to that part of the trust or transfer to which it |
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LRB095 05934 AJO 49059 a |
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| applies. |
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| (f) For purposes of this Section, a trust is not revoked or |
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| terminated by: |
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| (i) a power to veto a distribution from the trust; |
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| (ii) a testamentary special power of appointment or |
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| similar power; |
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| (iii) the right to receive a distribution of income, |
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| principal, or both in the discretion of another, including |
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| a trustee other than the settlor; |
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| (iv) an interest in a charitable remainder unitrust or |
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| charitable remainder annuity trust as defined in Internal |
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| Revenue Code Section 664 or any successor provision; |
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| (v) a right to receive principal subject to an |
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| ascertainable standard set forth in the trust; or |
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| (vi) the power to appoint a nonsubordinate adviser or |
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| trust protector who can remove and appoint trustees, who |
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| can direct, consent to, or disapprove distributions, or who |
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| is an investment adviser or has the power to appoint an |
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| investment adviser or investment director pursuant to the |
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| laws of this State. |
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| (g) The courts of this State shall have exclusive |
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| jurisdiction over any action brought under this Section. ".
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