STAND. COM. REP. NO. 396

Honolulu, Hawaii

, 2005

RE: H.B. No. 1756

H.D. 1

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred H.B. No. 1756 entitled:

"A BILL FOR AN ACT RELATING TO PROBATE,"

begs leave to report as follows:

The purpose of this bill is to lower the cost of administration of trusts and estates, by:

(1) Prohibiting attorneys serving as trustees or personal representatives from using trust or estate assets to defend actions, claims, or proceedings against them as trustees or personal representatives; and

(2) Requiring an attorney designated to serve as personal representative or trustee for a will or trust prepared by the attorney, to prepare a written estimate of compensation for the testator's or trustor's approval.

The Probate and Estate Planning Section of the Hawaii State Bar Association and a concerned individual testified in opposition to this bill. A concerned individual submitted comments.

Your Committee finds that while the intent of this bill is to prevent occurrences of abuse by trustees and personal representatives who happen to be attorneys, concerns have been raised over the potentially negative effects this measure may have on basic principles of probate and trust law, and on the ability of attorneys to effectively administer trusts and estates. This bill therefore merits further discussion.

Accordingly, your Committee has amended this bill by:

(1) Eliminating provisions prohibiting an attorney serving as a trustee or personal representative from using trust or estate assets to defend actions, claims, or proceedings against the attorney as a trustee or personal representative;

(2) Removing provisions requiring an attorney designated to serve as personal representative or trustee for a will or trust prepared by the attorney, to prepare a written estimate of compensation for the testator's or trustor's approval;

(3) Requiring an attorney designated to serve as personal representative or trustee for a will or trust prepared by the attorney, to prepare a written disclosure, for the testator's or trustor's approval, stating that the attorney anticipates compensation for the attorney's service, and the method by which compensation will be determined;

(4) Restricting the application of this bill to testamentary documents signed after the effective date of this measure;

(5) Adding a defective date to facilitate further discussion; and

(6) Making technical, nonsubstantive amendments for clarity and style.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1756, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1756, H.D. 1, and be referred to the Committee on Consumer Protection & Commerce.

Respectfully submitted on behalf of the members of the Committee on Judiciary,

 

____________________________

SYLVIA LUKE, Chair