June 7, 2006, Introduced by Reps. Dillon and Huizenga and referred to the Committee on Judiciary.
A bill to amend 1961 PA 101, entitled
"Supervision of trustees for charitable purposes act,"
by amending section 4 (MCL 14.254).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
4. (1) (a) The attorney general shall have has
jurisdiction and control and shall represent the people of the
state
and the uncertain or indefinite beneficiaries in of all
charitable
trusts in this state. , and The
attorney general may
enforce such
charitable trusts and
the grantors' intent
concerning grants and distributions from those trusts by proper
proceedings in the courts of this state.
(2) (b)
The attorney general is a necessary party to all
a
court proceedings
(1) action to terminate a charitable trust or
to
liquidate or distribute its assets;
, or (2) to
modify or
depart
from the objects or purposes of a charitable trust as the
same
are set forth in the instrument governing the trust,
including any proceeding for the application of the doctrine of cy
pres; ,
or (3) or to construe the provisions of an instrument
with
respect to a charitable trust. A judgment rendered in such
proceedings
a court action described in
this subsection without
service
of process and pleadings upon on
the attorney general ,
shall
be is voidable, unenforceable, and may be
set aside at the
option
of the attorney general upon his or
her motion seeking such
that relief. The attorney general shall intervene in any
proceedings
action affecting a charitable trust subject to this
act ,
when requested to do so by the court having
jurisdiction
of
the proceedings in which the
action is filed, and may intervene
in
any proceedings action affecting a
charitable trust when if
he or she determines that the public interest should be protected
in such
proceedings that action. With respect to such
proceedings,
no an action described in
this subsection, a
compromise, settlement agreement, contract, or judgment agreed to
by any or all parties having or claiming to have an interest in any
charitable
trust shall be is not valid unless the
attorney
general was
made is a party
to such proceedings in the action
and joined
joins in the compromise, settlement agreement,
contract, or judgment, or unless the attorney general, in writing,
waives
his or her right to participate. therein. The
attorney
general
is expressly authorized to enter into
such any
compromise,
settlement agreement, contract, or judgment
as that
in
his or her opinion
may be is in
the best interests of the
people of the state and the uncertain or indefinite beneficiaries
of the charitable trust.
(3) (c)
Whenever a petition is filed for probate of a last
will and testament containing any residuary bequest or devise to a
trustee, as
hereinbefore defined, or if such that
will creates
or purports to create a charitable trust, the petitioner shall
serve notice upon the attorney general, charitable trust division,
of the pendency of the proceedings, and the probate judge shall
make available and shall forward to the attorney general a copy of
the petition for probate of will and a copy of the instruments
filed for admission to probate. The notice and documents shall be
served by certified mail, return receipt requested, not less than
14 days before the hearing date on the petition. The judge of
probate
shall not pass upon the on a petition described in this
subsection in the absence of filing of proof of mailing. Upon
entering
his or her appearance, the attorney general shall
become
becomes a necessary party in interest in the estate proceedings,
either
in the probate court or by way of any appeal.
(4) (d)
The attorney general shall establish and maintain a
register of charitable trusts and trustees subject to this act and
of
the particular trust or other relationship under which they
the
trustees hold property for charitable
purposes. and The
attorney general shall conduct whatever investigation is necessary
,
and shall obtain from public
records, all courts of record,
court
officers, taxing authorities, trustees, and other sources ,
whatever information, copies of instruments, reports, and records
needed for
the establishment to
establish and maintenance
of
maintain
the register and files. The attorney
general shall be is
authorized
to require the necessary obtain any information and
documents ,
necessary to discharge the
requirements of this act
,
and to require true or certified copies thereof
of the
information
and documents to be furnished to him or her , and all
from
any public officials. A public official shall provide same,
without
payment of information and
documents to the attorney
general
under this subsection without any fee
or charge.
whatsoever.
(5) All of the following apply in an action under subsection
(1) to enforce the intent of the grantors of a charitable trust in
the distribution of assets:
(a) Unless a contrary intent is specifically established in
the trust instrument, proof of both of the following is considered
clear and convincing evidence of the intent of the grantors:
(i) The geographic location where the grantors originally
established the charitable trust.
(ii) The character, amount, and intended purpose of grants or
distributions, and the types of recipients to which grants and
distributions were made, by the charitable trust in the period from
the appointment of the original trustees of the trust to the time
that more than 50% of the trustees are not original trustees of the
trust.
(b) Each of the following is considered prima facie evidence
that a charitable trust is violating the intent of the grantors:
(i) If less than 50% of the amount of the trust's grants or
distributions in the most recent 3-year period before the action is
commenced were made to recipients located outside of the geographic
location where the grantors originally established the trust.
(ii) If less than 50% of the amount of the trust's grants or
distributions in the most recent 3-year period before the action is
commenced were made to different types of recipients than the types
of recipients to which grants or distributions were made by the
charitable trust in the period from the appointment of the original
trustees of the trust to the time that more than 50% of the
trustees are not original trustees of the trust.