Governor Strickland recently signed Substitute House Bill Number 499 (“Sub. H.B. 499”), which affects a number of changes to the Ohio Trust Code as codified under Ohio Revised Code (“ORC”) Title 58. While many of these changes are technical in nature, others are more substantive and should be noted by those institutions that serve as fiduciaries of Ohio trusts.

One notable change is that a trustee may now shorten the statute of limitations for contesting the validity of a trust that became irrevocable upon the death of the settlor. Under the Ohio Trust Code, the statute of limitations for such actions generally is two years from the date of the settlor’s death. However, as a result of Sub. H.B. 499, a trustee can now provide a notice to a person who may potentially contest the trust, and, by doing so, the potential contestant will be required to bring his or her action within six months of the notice. In order to trigger this shorter statute of limitations, the trustee must provide the potential contestant with a copy of the trust instrument and a notice informing the person of the trust’s existence, the trustee’s name and address, and the time allowed for commencing an action. See ORC § 5806.04. This change will help expedite the administration of trusts where the potential for a trust contest exists.

Another notable change relates to providing copies of trust instruments to beneficiaries. Under the Ohio Trust Code, a trustee is generally required to promptly furnish to a beneficiary upon request a copy of the trust instrument. (While a trust instrument may waive this requirement for some beneficiaries, it cannot be waived for current beneficiaries.) Under Sub. H.B. 499, unless a beneficiary expressly requests a copy of the entire trust instrument, a trustee may now satisfy this requirement by providing a redacted copy of the trust instrument to the beneficiary. See ORC § 5808.13(B)(1). Thus, this change will help trustees maintain, to a certain extent, the privacy of trust instruments.

Some other noteworthy aspects of Sub. H.B. 499 include the following:

  • If a trust instrument does not designate what law governs the administration of the trust, the law of the trust’s principal place of administration will govern. See ORC § 5801.06(B).
  • If any provision of a private settlement agreement authorized under ORC § 5801.10 is determined to be invalid, such invalidity does not affect the validity of other provisions of the agreement. See ORC § 5801.10(C).
  • Certifications of trust, which may be provided in lieu of a trust instrument to persons other than beneficiaries, no longer must include the trust’s taxpayer identification number and other information. See ORC § 5810.13.

Sub. H.B. 499 becomes effective on September 12, 2008.