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HB 6011

Probate: trusts; process for settling an account; modify. Amends 1998 PA 386 (MCL 700.1101 - 700.8206) by adding sec. 7908a.

2023-2024 Regular Session Introduced by Joey Andrews and 12 co-sponsors

The bill requires trustees to give standardized disclosures and a 45-day objection window for proposed trust account settlements, enabling nonjudicial resolutions or court review i

referred to second reading
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Bill Summary · HB 6011

Summary — HB 6011 (proposed MCL 700.7908a)

Status: Reported from Judiciary Committee; referred to second reading (reported without amendment 12/4/24). Introduced in the House by Rep. Penelope Tsernoglou (with cosponsors listed in the bill text) on 9/26/2024.

Purpose

To add a new section (700.7908a) to the Michigan Trust Code requiring standardized notice, accounting disclosures, and a 45‑day objection process when a trustee seeks settlement (final or interim) of trust accounts following certain events. The change creates a streamlined noncourt process for settling accounts while providing recipients a clear opportunity to object or pursue court review.

Key provisions

  • When a trustee seeks settlement of accounts after any of these events, the trustee must provide specified information within a reasonable time:
    • Events covered: trust termination under its terms; early termination under MCL 700.7414; trustee resignation or removal; or discharge of an interim accounting period while trust continues.
    • Required disclosures: fair market value of net assets to be distributed; a trust report for the prior 2 years showing receipts/disbursements and inventory value; estimates of anticipated receipts/disbursements; amounts of fees remaining (including trustee fees); notice of termination/resignation/removal and the accounting period at issue; trustee name, mailing address, and a contact phone number.
    • Trustee may also provide these materials to other persons reasonably believed to have an interest.
  • Objection window and consequences:
    • Recipients have 45 days after notice is sent to file a written objection to any disclosed act or omission.
    • If no timely objection, information is deemed approved and the trustee must distribute assets per the trust (or to successor trustee) within a reasonable time; recipients who consent or fail to object are barred from later suing or challenging the trust/accounting as if a court had entered a final order approving those accounts.
    • If objection is timely, the trustee or objector may (a) submit the issue to court (costs chargeable to the trust) or (b) resolve it by nonjudicial settlement agreement or other written agreement. Such agreements may include releases and indemnities in favor of the trustee.
  • Successor trustees may rely on the provided accounting and on written statements from notice recipients that they do not object; successor trustees are released from liability where no objections were timely made.
  • The section does not preclude a trustee from seeking court settlement under existing section 7201.

Who is affected

  • Trustees (original, additional, successor), qualified trust beneficiaries (as defined in MCL 700.7103), co‑trustees, successor trustees, and other persons the trustee reasonably believes have an interest in the trust. Banks and trust companies, and beneficiaries involved in trust distributions, are likely most affected.

Timing & procedure

  • 45‑day objection period from date notice is sent.
  • Trustee must provide 2 years of accounting information and other specified disclosures within a reasonable time after the triggering event and then distribute assets within a reasonable time after the 45‑day period if no objections.

Fiscal and administrative impact

  • No expected state fiscal impact. Potential indeterminate fiscal impact on local courts if the bill increases filings (objections submitted for court resolution).

Notes

  • The bill aligns settlement‑by‑notice with protections similar to court‑approved accountings by barring later claims where recipients consent or fail to object.
  • Cross-references: existing trust provisions cited include MCL 700.7201, 700.7414, 700.7604, 700.7905, and definitions in MCL 700.1107 and 700.7103.

Compiled from official sources — confirm details with the bill’s official record.

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