A. Whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution upon termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the designated distribution date.
B. As used in this section, "mandatory distribution" means a distribution of income or principal that the trustee is required to make to a beneficiary under the terms of the trust, including a distribution upon termination of the trust. "Mandatory distribution" does not include a distribution subject to the exercise of the trustee's discretion even if the discretion is expressed in the form of a standard of distribution or the terms of the trust authorizing distribution combine language of discretion with language of direction.
History: Laws 2003, ch. 122, § 5-506; 2007, ch. 128, § 15.
ANNOTATIONSThe 2007 amendment, effective July 1, 2007, added Subsection B.
Law reviews. — For article, "The New Mexico Uniform Trust Code," see 34 N.M.L. Rev. 1 (2004).