Should Connecticut Enact a Unitrust Statute?

Christopher J. Novak has recently published his comment entitled A Recommendation to the Connecticut General Assembly for the Enactment of a Unitrust Statute, 19 Quinn. Prob. Law Jour. 303 (2006).    

Here is the conclusion to his article:

The states of New York, Illinois, Maryland, and Connecticut have recognized that substantive trust law is undergoing a metamorphosis. The antiquated prudent man theory and its focus upon individual investment, inhibits modern day trustees from effectively serving settlors, beneficiaries, and remaindermen. Thus, in order to free trustees from the shackles of the prudent man theory, New York, Illinois, Maryland, and Connecticut had the foresight to enact their own versions of the Prudent Investor Act of 1994 and the Principal and Income Act of 1997. The adoption of both acts and their philosophical base in MPT, empowered trustees to efficiently administer trusts by shifting the fiduciary duty imposed upon a trustee from individual investment decisions to overall investment performance.
   
New York, Illinois, and Maryland also empowered its citizens by formally adopting a unitrust statute. In a unitrust, the amount of distribution to a beneficiary, the remainderman’s share, and the trustee’s compensation are all related to the performance of the trust corpus. Therefore, a total return unitrust enables trustees, beneficiaries, and remaindermen to share the common interest of growing the trust corpus quickly and effectively. However, each state’s unitrust statute is not without flaws. For example, the Maryland legislature has given its courts no guidance when faced with the decision to convert an income trust to a unitrust. On the otherhand, as In re Ives  showed, the New York legislature has given its courts five criteria to apply when confronted with the decision to convert an income trust to a unitrust.
   
Nevertheless, this comment’s comparison of state unitrust statutes was not done to highlight flaws. Rather, this comment’s purpose was to inform the Connecticut General Assembly of the opportunity to empower its citizens by formally adopting a unitrust statute that incorporates provisions to best serve settlors, trustees, beneficiaries, and remaindermen.
   
Connecticut should be applauded for its adoption of the Prudent Investor Act, Principal and Income Act, and its recognition that modern financial investment strategies necessitated a change in governing trust law. However, to date, Connecticut has failed to recognize the next step in trust creation: unitrusts. It is my hope that this comment will bring the opportunity of unitrusts to Connecticut’s citizens.