130.560 Failure of specific distribution
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/or/ors-chapter-130/uniform-trust-code/rules-governing-revocable-trusts/130-560·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
130.560 Failure of specific distribution.
(1)Subject to this section, a specific distribution does not fail by reason of the destruction, damage, sale, condemnation or change in form of the property that is the subject of the specific distribution unless:
(a)The trust instrument provides that the specific distribution fails under the particular circumstances; or
(b)The settlor, during the lifetime of the settlor, or the trustee gives property to the beneficiary of the specific distribution with the intent of satisfying the specific distribution.
(2)If part of the property that is the subject of a specific distribution is destroyed, damaged, sold or condemned, the remaining interest in the property passes pursuant to the specific distribution. The part of the property that is destroyed, damaged, sold or condemned is subject to subsections
(3)to
(6)of this section if the property would have been adeemed under the common law had the property been subject to probate in the settlor’s estate.
(3)If property that is the subject of a specific distribution is insured and the property is destroyed or damaged, the beneficiary of the specific distribution is entitled to receive the following amounts, less any amount expended or incurred by the settlor or trust estate in restoration or repair of the property:
(a)Any insurance proceeds for the destroyed or damaged property unpaid at the time set in the trust instrument for the specific distribution; and
(b)An amount equal to all insurance payments paid to the settlor, and such proceeds or awards paid to the trustee for the destroyed or damaged property, during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.
(4)If property that is the subject of a specific distribution is sold by the settlor or the trustee, the beneficiary of the specific distribution is entitled to receive:
(a)Any balance of the purchase price unpaid at the time set in the trust instrument for the specific distribution, including any security interest in the property and interest accruing before the time set in the trust instrument for the specific distribution; and
(b)An amount equal to all payments paid to the settlor or the trustee for the property during the six-month period immediately preceding the time set in the trust instrument for the specific distribution. Acceptance of a promissory note of the purchaser or a third party is not considered payment under this paragraph, but payment on the note is payment on the purchase price.
(5)If property that is the subject of a specific distribution is taken by condemnation before the time set in the trust instrument for the specific distribution, the beneficiary of the specific distribution is entitled to receive:
(a)Any amount of the condemnation award unpaid at the time set in the trust instrument for the specific distribution; and
(b)An amount equal to the sums paid under the condemnation award to the settlor or the trustee during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.
(6)If securities as defined in ORS 59.015 are the subject of a specific distribution, and after the execution of the trust instrument other securities of the same or another entity are distributed to the trustee or trust estate by reason of a partial liquidation, stock dividend, stock split, merger, consolidation, reorganization, recapitalization, redemption, exchange or any other similar transaction, the specific distribution includes the additional or substituted securities.
(7)The amount that a beneficiary of a specific distribution receives under this section must be reduced by any expenses of the sale or of the collection of the proceeds of insurance, sale or condemnation award and by any amount by which income is increased by reasons of items provided for in this section. Expenses subject to this subsection include attorney fees. [Formerly 128.390]