General Provisions and Definitions

NMSA 1978 ch. 46A, art. 1

in effect

NMSA 1978, § 46A-1-101 Short title

46A-1-101. Short title Chapter 46A NMSA 1978 may be cited as the "Uniform Trust Code". Laws 2003, ch. 122, § 1 -101; 2007, ch. 128, § 1.

NMSA 1978, § 46A-1-102 Scope

46A-1-102. Scope The Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978] applies to express trusts, charitable or noncharitable, and trusts created pursuant to a statute, judgment or decree that requires the trust to be administered in the manner of an express trust. Laws 2003, ch. 122, § 1 -102.

NMSA 1978, § 46A-1-103 Definitions

46A-1-103. Definitions As used in the Uniform Trust Code: A. "action", with respect to an act of a trustee, includes a failure to act; B. "ascertainable standard" means a standard relating to an individual's health, education, support or maintenance within the meaning of Subparagraph (A) of Paragraph (1) of Subsection (b) of Section 2041 and Paragraph (1) of Subsection (c) of Section 2514 of the Internal Revenue Code of 1986, as amended; C. "beneficiary" means a person that: (1) has a present or future beneficial interest in a trust, vested or contingent; or (2) in a capacity other than that of trustee, holds a power of appointment over trust property; D. "charitable trust" means a trust or portion of a trust created for a charitable purpose described in Subsection A of Section 46A-4-405 NMSA 1978; E. "conservator" means a person appointed by the court to administer the estate of a minor or adult individual; F. "environmental law" means a federal, state or local law, rule, regulation or ordinance relating to protection of the environment; G. "guardian" means a person appointed by the court or a parent to make decisions regarding the support, care, education, health and welfare of a minor or adult person. "Guardian" does not include a guardian ad litem; H. "interests of the beneficiaries" means the beneficial interests provided in the terms of the trust; I. "jurisdiction", with respect to a geographic area, includes a state or country; J. "person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency or instrumentality, public corporation or any other legal or commercial entity; K. "power of withdrawal" means a presently exercisable general power of appointment other than a power exercisable: (1) by a trustee and limited by an ascertainable standard; or (2) by another person only upon consent of the trustee or a person holding an adverse interest; L. "property" means anything that may be the subject of ownership, whether real or personal, legal or equitable, or any interest therein; M. "qualified beneficiary" means a beneficiary who, on the date the beneficiary's qualification is determined: (1) is a distributee or permissible distributee of trust income or principal; (2) would be a distributee or permissible distributee of trust income or principal if the interests of the distributees described in Paragraph (1) of this subsection terminated on that date without causing the trust to terminate; or (3) would be a distributee or permissible distributee of trust income or principal if the trust terminated on that date; N. "revocable", as applied to a trust, means revocable by the settlor without the consent of the trustee or a person holding an adverse interest; O. "settlor" means a person, including a testator, who creates or contributes property to a trust. If more than one person creates or contributes property to a trust, each person is a settlor of the portion of the trust property attributable to that person's contribution, except to the extent another person has the power to revoke or withdraw that portion; P. "spendthrift provision" means a term of a trust that restrains both voluntary and involuntary transfer of a beneficiary's interest; Q. "state" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States. "State" includes an Indian tribe, pueblo, nation or band recognized by federal law or formally acknowledged by a state; R. "terms of a trust" means: (1) except as otherwise provided in Paragraph (2) of this subsection, the manifestation of the settlor's intent regarding a trust's provisions as: (a) expressed in the trust instrument; or (b) established by other evidence that would be admissible in a judicial proceeding; or (2) the trust's provisions as established, determined or amended by: (a) a trustee or trust director in accordance with applicable law; (b) court order; or (c) a nonjudicial settlement agreement under Section 46A-1-111 NMSA 1978; S. "trust instrument" means an instrument executed by the settlor that contains terms of the trust, including any amendments thereto; and T. "trustee" includes an original trustee, an additional trustee, a successor trustee and a co-trustee. Laws 2003, ch. 122, § 1 -103; 2007, ch. 128, § 2; 2018, ch. 63, § 20.

NMSA 1978, § 46A-1-104 Knowledge

46A-1-104. Knowledge A. Subject to Subsection B of this section, a person has knowledge of a fact if the person: (1) has actual knowledge; (2) has received a notice or notification of it; or (3) from all the facts and circumstances known to the person at the time in question, has reason to know it. B. An organization that conducts activities through employees has notice or knowledge of a fact involving a trust only from the time the information was received by an employee having responsibility to act for the trust, or would have been brought to the employee's attention if the organization had exercised reasonable diligence. An organization exercises reasonable diligence if it maintains reasonable routines for communicating significant information to the employee having responsibility to act for the trust and there is reasonable compliance with the routines. Reasonable diligence does not require an employee of the organization to communicate information unless the communication is part of the employee's regular duties or the employee knows that a matter involving the trust would be materially affected by the information. Laws 2003, ch. 122, § 1 -104; 2007, ch. 128, § 3.

NMSA 1978, § 46A-1-105 Default and mandatory rules

46A-1-105. Default and mandatory rules A. Except as otherwise provided in the terms of the trust, the Uniform Trust Code governs the duties and powers of a trustee, relations among trustees and the rights and interests of a beneficiary. B. The terms of a trust prevail over any provision of the Uniform Trust Code except: (1) the requirements for creating a trust; (2) subject to Sections 9, 11 and 12 [46-14-9, 46-14-11 and 46-14-12] of the Uniform Directed Trust Act, the duty of a trustee to act in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries; (3) the requirement that a trust and its terms be for the benefit of its beneficiaries and that the trust have a purpose that is lawful, not contrary to public policy and possible to achieve; (4) the power of the court to modify or terminate a trust under Sections 46A-4-410 through 46A-4-416 NMSA 1978; (5) the effect of a spendthrift provision and the rights of certain creditors and assignees to reach a trust as provided in Chapter 46A, Article 5 NMSA 1978; (6) the power of the court under Section 46A-7-702 NMSA 1978 to require, dispense with or modify or terminate a bond; (7) the power of the court under Subsection B of Section 46A-7-708 NMSA 1978 to adjust a trustee's compensation specified in the terms of the trust that is unreasonably low or high; (8) the duty under Paragraphs (2) and (3) of Subsection B of Section 46A-8-813 NMSA 1978 to notify qualified beneficiaries of an irrevocable trust who have attained twenty-five years of age of the existence of the trust, of the identity of the trustee and of their right to request reports of the trustee; (9) except as otherwise provided in Subsection F of Section 46A-8-813 NMSA 1978, the duty under Subsection A of Section 46A-8-813 NMSA 1978 to respond to the request of a qualified beneficiary of an irrevocable trust for a trustee's reports and other information reasonably related to the administration of a trust; (10) the effect of an exculpatory term under Section 46A-10-1008 NMSA 1978; (11) the rights under Sections 46A-10-1010 through 46A-10-1013 NMSA 1978 of a person other than a trustee or beneficiary; (12) periods of limitation for commencing a judicial proceeding; provided, however, any such period may be increased; (13) the power of the court to take such action and exercise such jurisdiction as may be necessary in the interests of justice; and (14) the subject-matter jurisdiction of the court and venue for commencing a proceeding as provided in Sections 46A-2-203 and 46A-2-204 NMSA 1978. Laws 2003, ch. 122, § 1 -105; 2007, ch. 128, § 4; 2018, ch. 63, § 21.

NMSA 1978, § 46A-1-106 Common law of trusts; principles of equity

46A-1-106. Common law of trusts; principles of equity The common law of trusts and principles of equity supplement the Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978], except to the extent modified by that code or another statute of this state. Laws 2003, ch. 122, § 1 -106.

NMSA 1978, § 46A-1-107 Governing law

46A-1-107. Governing law The meaning and effect of the terms of a trust are determined by: A. the law of the jurisdiction designated in the terms unless the designation of that jurisdiction's law is contrary to a strong public policy of the jurisdiction having the most significant relationship to the matter at issue; or B. in the absence of a controlling designation in the terms of the trust, the law of the jurisdiction having the most significant relationship to the matter at issue. Laws 2003, ch. 122, § 1 -107; 2007, ch. 128, § 5; 2011, ch. 124, § 94.

NMSA 1978, § 46A-1-108 Principal place of administration

46A-1-108. Principal place of administration A. Without precluding other means for establishing a sufficient connection with the designated jurisdiction, terms of a trust designating the principal place of administration are valid and controlling if: (1) a trustee's principal place of business is located in or a trustee is a resident of the designated jurisdiction; or (2) all or part of the administration occurs in the designated jurisdiction. B. A trustee is under a continuing duty to administer the trust at a place appropriate to its purposes, its administration and the interests of the beneficiaries. C. Without precluding the right of the court to order, approve or disapprove a transfer, the trustee, in furtherance of the duty prescribed by Subsection B of this section, may transfer the trust's principal place of administration to another state or to a jurisdiction outside of the United States. D. The trustee shall notify the qualified beneficiaries of a proposed transfer of a trust's principal place of administration not less than sixty days before initiating the transfer. The notice of proposed transfer must include: (1) the name of the jurisdiction to which the principal place of administration is to be transferred; (2) the address and telephone number at the new location at which the trustee can be contacted; (3) an explanation of the reasons for the proposed transfer; (4) the date on which the proposed transfer is anticipated to occur; and (5) the date, not less than sixty days after the giving of the notice, by which the qualified beneficiary must notify the trustee of an objection to the proposed transfer. E. The authority of a trustee under this section to transfer a trust's principal place of administration terminates if a qualified beneficiary notifies the trustee of an objection to the proposed transfer on or before the date specified in the notice. F. In connection with a transfer of the trust's principal place of administration, the trustee may transfer some or all of the trust property to a successor trustee designated in the terms of the trust or appointed pursuant to Section 7-704 [46A-7-704 NMSA 1978] of the Uniform Trust Code. Laws 2003, ch. 122, § 1 -108.

NMSA 1978, § 46A-1-109 Methods and waiver of notice

46A-1-109. Methods and waiver of notice A. Notice to a person under the Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978] or the sending of a document to a person under that code must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document. Permissible methods of notice or for sending a document include first-class mail, personal delivery, delivery to the person's last known place of residence or place of business or a properly directed electronic message. B. Notice otherwise required under the Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978] or a document otherwise required to be sent under that code need not be provided to a person whose identity or location is unknown to and not reasonably ascertainable by the trustee. C. Notice under the Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978] or the sending of a document under that code may be waived by the person to be notified or sent the document. D. Notice of a judicial proceeding must be given as provided in the applicable rules of civil procedure. Laws 2003, ch. 122, § 1 -109.

NMSA 1978, § 46A-1-110 Others treated as qualified beneficiaries

46A-1-110. Others treated as qualified beneficiaries A. A charitable organization expressly designated to receive distributions under the terms of a charitable trust has the rights of a qualified beneficiary under the Uniform Trust Code [46A-1-101 NMSA 1978] if the charitable organization, on the date the charitable organization's qualification is being determined: (1) is a distributee or permissible distributee of trust income or principal; (2) would be a distributee or permissible distributee of trust income or principal upon the termination of the interests of other distributees or permissible distributees then receiving or eligible to receive distributions; or (3) would be a distributee or permissible distributee of trust income or principal if the trust terminated on that date. B. A person appointed to enforce a trust created for the care of an animal or another noncharitable purpose as provided in Section 46A-4-408 or 46A-4-409 NMSA 1978 has the rights of a qualified beneficiary under the Uniform Trust Code. C. The attorney general has the rights of a qualified beneficiary with respect to a charitable trust having its principal place of administration in this state or its charitable beneficiary or beneficiaries that receive or are eligible to receive in the aggregate the trust's largest distribution in this state. Laws 2003, ch. 122, § 1 -110; 2007, ch. 128, § 6.

NMSA 1978, § 46A-1-111 Nonjudicial settlement agreements

46A-1-111. Nonjudicial settlement agreements A. For purposes of this section, "interested persons" means persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the court. B. Except as otherwise provided in Subsection C of this section, interested persons may enter into a binding nonjudicial settlement agreement with respect to any matter involving a trust. C. A nonjudicial settlement agreement is valid only to the extent it does not violate a material purpose of the trust and includes terms and conditions that could be properly approved by the court under the Uniform Trust Code [46A-1-101 to 46A-11-1104 NMSA 1978] or other applicable law. D. Matters that may be resolved by a nonjudicial settlement agreement include: (1) the interpretation or construction of the terms of the trust; (2) the approval of a trustee's report or accounting; (3) direction to a trustee to refrain from performing a particular act or the grant to a trustee of any necessary or desirable power; (4) the resignation or appointment of a trustee and the determination of a trustee's compensation; (5) transfer of a trust's principal place of administration; and (6) liability of a trustee for an action relating to the trust. E. Any interested person may request the court to approve a nonjudicial settlement agreement to determine whether the representation as provided in Article 3 [46A-3-301 to 46A-3-305 NMSA 1978] of the Uniform Trust Code was adequate and to determine whether the agreement contains terms and conditions the court could have properly approved. Laws 2003, ch. 122, § 1 -111.

NMSA 1978, § 46A-1-112 Rules of construction

46A-1-112. Rules of construction The rules of construction that apply in this state to the interpretation of and disposition of property by will also apply as appropriate to the interpretation of the terms of a trust and the disposition of the trust property. Laws 2003, ch. 122, § 1 -112.

NMSA 1978, § 46A-1-113 Insurable interest of trustee

46A-1-113. Insurable interest of trustee A. In this section, "settlor" means a person that executes a trust instrument. "Settlor" includes a person for which a fiduciary or agent is acting. B. A trustee of a trust has an insurable interest in the life of an individual insured under a life insurance policy that is owned by the trustee of the trust acting in a fiduciary capacity or that designates the trust itself as the owner if, on the date the policy is issued: (1) the insured is: (a) a settlor of the trust; or (b) an individual in whom a settlor of the trust has, or would have had if living at the time the policy was issued, an insurable interest; and (2) the life insurance proceeds are primarily for the benefit of one or more trust beneficiaries that have: (a) an insurable interest in the life of the insured; or (b) a substantial interest engendered by love and affection in the continuation of the life of the insured and, if not already included under Subparagraph (a) of this paragraph, who are: 1) related within the third degree or closer, as measured by the civil law system of determining degrees of relation, either by blood or law, to the insured; or 2) stepchildren of the insured. 1978 Comp., § 46A-1-113, enacted by Laws 2011, ch. 124, § 95; 2016, ch. 69, § 723.

Source: New Mexico Compilation Commission (nmonesource.com)URL: https://nmonesource.com/nmos/nmsa-unanno/en/item/18548/index.doFetched: 10/20/2026