CO Code § 15-16-915 (2021)
2021 Colorado Code|Title 15 - Probate, Trusts, and Fiduciaries|Article 16 - Trust Administration|Part 9 - Colorado Uniform Trust Decanting Act|§ 15-16-915. Trust Limitation on Decanting

  An authorized fiduciary may not exercise the decanting power to the extent the first-trust instrument expressly prohibits exercise of:   The decanting power; or    A power granted by state law to the fiduciary to distribute part or all of the principal of the trust to another trust or to modify the trust.       Exercise of the decanting power is subject to any restriction in the first-trust instrument that expressly applies to exercise of:   The decanting power; or    A power granted by state law to a fiduciary to distribute part or all of the principal of the trust to another trust or to modify the trust.       A general prohibition of the amendment or revocation of a first trust, a spendthrift clause, or a clause restraining the voluntary or involuntary transfer of a beneficiary's interest does not preclude exercise of the decanting power.    Subject to subsections (1) and (2) of this section, an authorized fiduciary may exercise the decanting power under this part 9 even if the first-trust instrument permits the authorized fiduciary or another person to modify the first-trust instrument or to distribute part or all of the principal of the first trust to another trust.    If a first-trust instrument contains an express prohibition described in subsection (1) of this section or an express restriction described in subsection (2) of this section, the provision must be included in the second-trust instrument.     History. Source: L. 2016: Entire part added,(SB 16-085), ch. 228, p. 883, § 1, effective August 10.    COMMENT   A trust instrument may expressly preclude the exercise of a decanting power under the act or any similar state statute with respect to the entire trust or with respect to one or more provisions of the trust. See Section 15-16-915(1) . The exercise of a decanting power, however, is not prohibited by a statement that the trust is irrevocable or unamendable, or by a spendthrift provision. See Section 15-16-915(3) . In order to preclude the exercise of the decanting power, the first-trust instrument must expressly refer to the act or to a power granted by state law to the fiduciary to distribute part or all of the principal of the trust to another trust or to modify the trust. For example, assume a first-trust instrument states: “There shall always be a trustee who is an attorney or accountant.” That sentence alone would not prohibit the exercise of the decanting power to eliminate that requirement. If the first-trust instrument, however, also stated that “this provision may not be modified by the exercise of any decanting power,” then the exercise of the decanting power to modify that provision would be prohibited by Section 15-16-915(1) .   Any restriction in the first-trust instrument that expressly applies to decanting is honored. Thus, for example, a restriction in the first-trust instrument that requires court approval of any decanting that accelerates the distribution of trust assets would be enforced. As another example, a restriction requiring approval of any decanting by a particular third party would also be enforced.   An irrevocable trust may provide in the trust instrument a mechanism for modifying the trust, for example, by granting a trust protector the power to modify the trust. The fact that a trust instrument provides such a mechanism for modification does not preclude the application of this act. Any requirements or restrictions contained in the trust instrument for such modification mechanism do not apply to an exercise of a decanting power under this act unless such requirements or restrictions expressly apply to an exercise of a decanting power under this act or a similar state statute.   If the first-trust instrument contains a restriction on decanting, the provision must be included in the second-trust instrument. Section 15-16-915(5) . This provision is intended to prevent serial decanting in which the first decanting removes the restriction on changing a particular provision in the first-trust instrument, and the second decanting then changes such provision.