§ 36C-4-411. Modification or termination of noncharitable irrevocable trust by consent. - North Carolina Statutes

§ 36C‑4‑411. Modification or termination of noncharitable irrevocable trust by consent.

(a)        If the settlor andall beneficiaries of a noncharitable irrevocable trust consent, they may compelthe modification or termination of the trust without the approval of the courteven if the modification or termination is inconsistent with a material purposeof the trust. If any beneficiary (i) is a minor or incompetent or a person whois unborn or whose identity or location is unknown and (ii) is unable to berepresented under Article 3 of this Chapter, the settlor or any competent adultbeneficiary or the representative of any beneficiary properly represented underArticle 3 of this Chapter may institute a proceeding before the court toappoint a guardian ad litem. The court shall allow the modification ortermination if the court finds that, following the appointment of a guardian adlitem, all beneficiaries or their representatives have consented. A settlor'spower to consent to a trust's modification or termination may be exercised by:

(1)        An agent under apower of attorney only to the extent expressly authorized by the power ofattorney or the terms of the trust.

(2)        The settlor'sgeneral guardian or the guardian of the estate with the approval of the courtsupervising the guardianship.

(b)        A noncharitableirrevocable trust may be terminated upon consent of all of the beneficiaries ifthe court concludes that continuance of the trust is not necessary to achieveany material purpose of the trust. A noncharitable irrevocable trust may bemodified upon consent of all of the beneficiaries, if the court concludes thatmodification is consistent with a material purpose of the trust.

(c)        Where thebeneficiaries of an a noncharitable irrevocable trust seek to compel a terminationof the trust and the continuance of the trust is necessary to carry out amaterial purpose of the trust, or where the beneficiaries seek to compel amodification of the trust in a manner that is inconsistent with its materialpurpose, the trust may be modified or terminated, in the discretion of thecourt, only if the court determines that the reason for modifying orterminating the trust under the circumstances substantially outweighs theinterest in accomplishing a material purpose of the trust.

(d)        If not all of thebeneficiaries consent to a proposed modification or termination of the trustunder subsection (a), (b), or (c) of this section, the modification ortermination may be approved by the court if the court is satisfied that all ofthe following apply:

(1)        If all of thebeneficiaries had consented, the trust could have been modified or terminatedunder this section.

(2)        The interests of abeneficiary who does not consent will be adequately protected.

(e)        Repealed by SessionLaws 2006‑259, s. 13(d), effective October 1, 2006.

(f)         In determining theclass of beneficiaries whose consent is necessary to modify or terminate atrust under this section, the presumption of fertility is rebuttable.

(g)        If a trustinstrument provides for the disposition of property to a class of personsdescribed only as "heirs" or "next of kin" of any person oruses other words that describe the class of all persons who would take underthe rules of intestacy, the court may limit the class of beneficiaries whoseconsent is needed to compel the modification or termination of the trust to thebeneficiaries who are reasonably likely to take under the circumstances. (2005‑192, s. 2; 2006‑259,s. 13(d); 2007‑106, s. 17.)