New Michigan Trust Code Becomes Effective April 1, 2010

New Michigan Trust Code Becomes Effective April 1, 2010


Michigan’s Governor Granholm signed Public Acts 2009, Number 46, the new Michigan Trust Code (MTC), into law on June 18, 2009. The MTC replaces Article VII of the Estates and Protected Individuals Code (EPIC) and becomes effective April 1, 2010. With this enactment, Michigan becomes the 24th state to adopt a trust code based on the Uniform Trust Code (UTC) promulgated by the National Conference of Commissioners on Uniform State Laws.
 
The UTC, and therefore the MTC, aims to make Michigan equally as attractive as Florida and Arizona as trust domiciles by recognizing that revocable trusts, in particular, have become as popular as simple wills to settle an estate. Though the entire Code was replaced, only a few provisions were dramatically changed from the former Code. 
  • The MTC contains new law concerning the use of trust protectors, defined as persons designated in the trust with authority that can supersede the authority of a trustee to direct certain actions under certain conditions. Michigan attorneys have used the concept in the past, but this is the first time it has been codified.
  • The law sets the same standard of capacity to create a revocable trust as to make a will. The across-the-board capacity standards are now also in line with the standards to execute other documents like powers of attorney.
  • Codifies well-established rules and common law concerning the rights of creditors.