RS 1335 - Mode of creation; acceptance of beneficial interests; amendments
A. A trust shall be created, organized, structured, and empowered by a written instrument, which shall be in accordance with this Subpart. A trust agreement shall be subscribed by the corporation as settlor by authentic act or by act under private signature executed in the presence of two witnesses and duly acknowledged by the settlor or by the affidavit of one of the attesting witnesses. A trust agreement shall become effective upon acceptance by the trustee and the beneficiaries as provided in this Section. A trust's existence as a juridical person begins, and the trust is duly organized, when its trust agreement becomes effective, even if no property is contributed to that trust until a later time. Upon effectiveness, a trust agreement shall be and constitute a binding contract among the corporation as settlor, the beneficiaries, and the trustee, for the acceptance of the beneficial interests in the trust by the designated beneficiaries, and the application of the proceeds of the trust property and its operation for the purposes and in accordance with the stipulations of the approved trust agreement. A trust agreement shall not be an ancillary agreement as defined in R.S. 45:1312.
B. Before the execution of a trust agreement, that instrument shall be approved by the commission in a financing order, or by the use of an approval method provided in a financing order.
C. Before a trust agreement and a trust become effective, the trust agreement shall be accepted by the trustees and the beneficiaries. The trustee may accept the trust in the trust agreement, or in a separate written instrument within a reasonable amount of time after the trust agreement's execution. Each beneficiary may accept the trust in the trust agreement or by written acceptance of the beneficial interest endorsed thereon. The corporation settlor and the related utility shall be the trust's only beneficiaries.
D. Promptly after a trust agreement takes effect, the trust agreement, together with any separate written acceptances, shall be recorded in the conveyance records of the clerk of court of the parish of East Baton Rouge.
E. A trust agreement may be modified, amended, terminated, or rescinded only with the express approval of the commission, the corporation, the beneficiary-related utility, and its trustee. Each amendment to a trust agreement shall be recorded in the conveyance records of the clerk of court of the parish of East Baton Rouge.
F. A trust shall have duration for the term specified in the trust agreement. Notwithstanding any provisions of the trust agreement or the provisions of Subsection E of this Section, no termination, rescission, rehabilitation, liquidation, or dissolution of a trust shall take effect as long as any of the related bonds are outstanding. Upon termination, the trustee shall file a certificate of termination of the trust agreement in the conveyance records of the clerk of court of the parish of East Baton Rouge.
G. Each trust agreement shall establish a name for its trust that is distinguishable from the name of every other trust previously created by the corporation and from the name of any entity registered with the secretary of state. The name shall not imply that the trust is a political subdivision or an administrative agency of this state.
Acts 2021, No. 293, §3, eff. June 14, 2021.