Notice of proposed action: Authorized; to whom notice must be sent; content; objection to proposed action; liability of trustee; court order to take action over objection; burden of proof; notice when action not taken.
1. As used in this section, “action” includes a course of action and a decision on whether or not to take action.
2. A trustee may provide a notice of proposed action regarding any matter governed by NRS 164.700 to 164.925, inclusive.
3. If a trustee provides a notice of proposed action, the trustee shall mail the notice of proposed action to every adult beneficiary who, at the time the notice is provided, receives, or is entitled to receive, income under the trust or who would be entitled to receive a distribution of principal if the trust were terminated. A notice of proposed action need not be provided to a person who consents in writing to the proposed action. A consent to a proposed action may be executed before or after the proposed action is taken.
4. The notice of proposed action must state:
(a) That the notice is provided pursuant to this section;
(b) The name and mailing address of the trustee;
(c) The name and telephone number of a person with whom to communicate for additional information regarding the proposed action;
(d) A description of the proposed action and an explanation of the reason for taking the action;
(e) The time within which objection to the proposed action may be made, which must be not less than 30 days after the notice of proposed action is mailed; and
(f) The date on or after which the proposed action is to be taken or is to be effective.
5. A beneficiary may object to the proposed action by mailing a written objection to the trustee at the address and within the time stated in the notice.
6. If no beneficiary entitled to receive notice of a proposed action objects to the proposed action and the other requirements of this section are met, the trustee is not liable to any present or future beneficiary with respect to that proposed action.
7. If the trustee received a written objection to the proposed action within the period specified in the notice, the trustee or a beneficiary may petition the court for an order to take the action as proposed, take the action with modification or deny the proposed action. A beneficiary who failed to object to the proposed action is not estopped from opposing the proposed action. The burden is on a beneficiary to prove that the proposed action should not be taken or should be modified.
8. If the trustee decides not to take a proposed action for which notice has been provided, the trustee shall notify the beneficiaries of his decision not to take the proposed action and the reasons for his decision. The trustee is not liable to any present or future beneficiary with respect to the decision not to take the proposed action. A beneficiary may petition the court for an order to take the action as proposed. The burden is on the beneficiary to prove that the proposed action should be taken.
9. If the proposed action for which notice has been proved is an adjustment to principal and income pursuant to NRS 164.795, the sole remedy a court may order, pursuant to subsections 7 and 8, is to make the adjustment, to make the adjustment with a modification or to order the adjustment not to be made.
Last modified: February 25, 2006