North Dakota HB 1228 Summary

• Establishes that settlor capacity for trusts equals the capacity required to make a will, applicable to creation, amendment, revocation, or adding property to trusts.

• Creates new procedures for challenging trust validity through declaratory judgment, with limitation periods ranging from 120 days after notice to three years after settlor's death.

• Authorizes trustees to "decant" (appoint) irrevocable trust assets to new trusts with modified terms, subject to fiduciary duties and restrictions on reducing beneficiary rights or extending perpetuities periods.

• Creates roles for directed trustees including investment trust advisors, distribution trust advisors, and trust protectors with specified powers to direct trust decisions, limiting fiduciary liability when following directions.

• Permits conversion of income trusts to total return unitrusts (distributing fixed percentage of assets annually) with trustee authority and beneficiary notice requirements, allowing flexibility in trust administration.