House File 232, which is currently before the Governor for signature, provides a mechanism whereby new trusts and existing trusts will have a new tool to obtain information from third parties. The new provision allows a Trustee to present a written request to any person for the purpose to obtain information required to perform the Trustee’s duties or any information on property owned by the Trust and which is owned by the Trust Settlor at the time of death, including information about the property that has passed or will pass by beneficiary designations or joint tenancy ownership.
The request must contain a Certification of Trust under Section 633A.4604. The person to whom the request is provided may request proof of the Trustees identity. The person who receives the request must provide the information within ten business days after receiving the request. If the information is not provided within the ten-day period, an action may be brought within one year after the date of the act or failure to act. If the Court finds that the person acted unreasonably in failing to deliver the information, the Court has the authority to award damages sustained by the Trust or Estate, the costs of the action, a penalty of not less than $500 and not greater than $10,000 to be determined by the Court, and reasonable attorney fees which are based on the value of the time reasonably expended by the attorney. Note that under the Act the time to respond is measured from the date of the receipt by the third party. As such, it would appear that it would be prudent to send the request by Certified Mail Return Receipt Requested.
In my blog next month I will update you as to the date that the Governor approves the bill or vetoes the bill.