§ 15-5-502 — Spendthrift provision

(1) A spendthrift provision is valid only if it
restrains both voluntary and involuntary transfer of a beneficiary's interest.

(2) A term of a trust providing that the interest of a beneficiary is held
subject to a spendthrift trust, or words of similar import, is sufficient to restrain
both voluntary and involuntary transfer of the beneficiary's interest.

(3) A beneficiary may not transfer an interest in a trust in violation of a valid
spendthrift provision and, except as otherwise provided in this part 5, a creditor or
assignee of the beneficiary may not reach the interest or a distribution by the
trustee before its receipt by the beneficiary.

(4) A trustee of a trust that is subject to a spendthrift provision may make a
distribution that is required or authorized by the terms of the trust by applying the
distribution for the beneficiary's benefit. A creditor or assignee of the beneficiary
may not reach a distribution that is applied for the beneficiary's benefit, and no
trustee is liable to any creditor of a beneficiary for making such a distribution.

(5) Real property or tangible personal property that is owned by the trust but
that is made available for a beneficiary's use or occupancy in accordance with the
trustee's authority under the terms of the trust is not considered to have been
distributed by the trustee or received by the beneficiary for purposes of allowing a
creditor or assignee of the beneficiary to reach the property.

Legislative History

Source: L. 2021: Entire part added, (SB 21-162), ch. 170, p. 939, � 1, effective September 7.