Tennessee § 35-15-504 Discretionary interests - Effect thereof

Tennessee Statutes

§ 35-15-504 — Discretionary interests - Effect thereof

(a)A discretionary interest is neither a property interest nor an enforceable right; it is a mere expectancy.

(b)Relative to a discretionary interest, whether or not a trust contains a spendthrift provision:

(1)No creditor or assignee shall force or otherwise reach a distribution with regard to a discretionary interest;

(2)No creditor or assignee shall require a trustee, cotrustee or other fiduciary to exercise the trustee's, cotrustee's or other fiduciary's discretion to make a distribution with regard to a discretionary interest;

(3)Regardless of whether a beneficiary has any outstanding creditors or assignees, a trustee, cotrustee or other fiduciary of a discretionary interest may directly pay any expense on behalf of such beneficiary and may exhaust the income and principal of the

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(a) A discretionary interest is neither a property interest nor an enforceable right; it is a mere expectancy. (b) Relative to a discretionary interest, whether or not a trust contains a spendthrift provision: (1) No creditor or assignee shall force or otherwise reach a distribution with regard to a discretionary interest; (2) No creditor or assignee shall require a trustee, cotrustee or other fiduciary to exercise the trustee's, cotrustee's or other fiduciary's discretion to make a distribution with regard to a discretionary interest; (3) Regardless of whether a beneficiary has any outstanding creditors or assignees, a trustee, cotrustee or other fiduciary of a discretionary interest may directly pay any expense on behalf of such beneficiary and may exhaust the income and principal of the trust for the benefit of such beneficiary; (4) No trustee, cotrustee or other fiduciary is liable to any creditor or assignee for paying the expenses of a beneficiary of a discretionary interest; (5) (A) Regardless of whether a beneficiary holding a discretionary interest is also a trustee, cotrustee or other fiduciary, subdivisions (b)(1)-(4) remain applicable if: (i) The beneficiary-fiduciary does not have the discretion to make or participate in making distributions to such beneficiary-fiduciary; (ii) The beneficiary-fiduciary's discretion to make or participate in making distributions to such beneficiary-fiduciary is limited by an ascertainable standard; or (iii) The beneficiary-fiduciary's discretion to make or participate in making distributions to such beneficiary-fiduciary is exercisable only with the consent of a cotrustee or another person holding an adverse interest; (B) A creditor or assignee may compel or otherwise reach a distribution only to the extent the creditor or assignee may compel or otherwise reach a distribution if the beneficiary was not acting as a trustee, cotrustee or other fiduciary.

Tennessee § 35-15-504 (Discretionary interests - Effect thereof) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.