Petition to Modify or Terminate Trust (Alabama)

PETITION TO MODIFY OR TERMINATE TRUST

(Ala. Code §§ 19-3B-410, 411, 412, 413, 414, 415, 416)

COURT INFORMATION

Filing Court (check one):
☐ CIRCUIT COURT OF [____________] COUNTY, ALABAMA (inter vivos trust — § 19-3B-203(a))
☐ PROBATE COURT OF [____________] COUNTY, ALABAMA (testamentary trust, or inter vivos trust where probate court has statutory equitable jurisdiction — § 19-3B-203(b))

Case Number: [________________________________]

Division: [________________________________]

Judge: [________________________________]

Hearing Date: [__/__/____] Time: [____]

IN THE MATTER OF:

Name of Trust: [________________________________]

Date of Trust Instrument: [__/__/____]

Settlor(s): [________________________________]

Date of Settlor's Death (if applicable): [__/__/____]

Type of Trust:
☐ Revocable Living Trust (now irrevocable by reason of death/incapacity of settlor)
☐ Irrevocable Inter Vivos Trust
☐ Testamentary Trust (under Will of [________________________________], admitted to probate in Case No. [____________])
☐ Charitable Trust (Attorney General notice required per § 19-3B-110 / § 19-3B-405)
☐ Special Needs Trust
☐ Other: [________________________________]

I. PETITIONER INFORMATION

Name of Petitioner: [________________________________]

Capacity of Petitioner (check one or more):
☐ Acting Trustee of the Trust
☐ Co-Trustee
☐ Successor Trustee (appointed [__/__/____])
☐ Settlor (living)
☐ Conservator / Guardian of the Settlor (court order dated [__/__/____])
☐ Qualified Beneficiary — current mandatory distributee (§ 19-3B-103(15))
☐ Qualified Beneficiary — first-line remainder / contingent
☐ Attorney-in-Fact for Settlor (express trust-modification authority in POA at § [____])
☐ Other: [________________________________]

Address of Petitioner:
Street: [________________________________]
City: [________________] State: AL Zip: [________]

Telephone: [(___) ___-____] Email: [________________________________]

Attorney for Petitioner:
Name: [________________________________]
Alabama Bar No.: [________________________________]
Firm: [________________________________]
Address: [________________________________]
Telephone: [(___) ___-____] Email: [________________________________]

II. TRUST IDENTIFICATION

Full Legal Name of Trust: [________________________________]

Date of Trust Instrument: [__/__/____]

Amendments / Restatements:

Taxpayer Identification Number (last four): XXX-XX-[____]

Trust Status:
☐ Revocable (settlor living and competent)
☐ Irrevocable by terms of instrument
☐ Irrevocable by reason of settlor's death on [__/__/____]
☐ Irrevocable by reason of settlor's incapacity (determined [__/__/____])

Governing Law: Alabama Uniform Trust Code, Ala. Code §§ 19-3B-101 et seq.

Principal Place of Administration (§ 19-3B-108): [County of ____________], Alabama

Current Acting Trustee(s): [________________________________]

Approximate Current Fair Market Value of Trust Assets: $[__________]

Summary of Trust Assets (full inventory attached as Exhibit B):

III. JURISDICTION AND VENUE

1. Subject matter jurisdiction. This Court has subject matter jurisdiction over this proceeding under Ala. Code § 19-3B-203: ☐ this is a Circuit Court and has exclusive jurisdiction over proceedings concerning the administration of an inter vivos trust under § 19-3B-203(a); ☐ this is a Probate Court granted statutory equitable jurisdiction and has concurrent jurisdiction under § 19-3B-203(b); ☐ this is the Probate Court that admitted the will of the Settlor to probate and has jurisdiction over the testamentary trust.

2. Venue. Venue is proper in this county pursuant to Ala. Code § 19-3B-204 because [☐ the principal place of administration of the Trust is in this county; ☐ this is the court in which the Settlor's will was admitted to probate; ☐ other: ____________].

3. Standing. Petitioner has standing to bring this petition as [☐ a trustee under § 19-3B-410(a); ☐ a beneficiary under § 19-3B-410(a); ☐ the settlor under § 19-3B-410(a) / § 19-3B-411(a); ☐ a representative under § 19-3B-301-305].

IV. STATUTORY BASIS FOR RELIEF

Petitioner seeks relief on each of the following grounds (check all that apply):

A. § 19-3B-411 — Modification or Termination by Consent

☐ § 19-3B-411(a) — Settlor + All Beneficiaries Consent. The Settlor is living and competent. The Settlor AND all beneficiaries consent in writing to the proposed modification or termination (Exhibit C). The Court "shall" approve, even if inconsistent with a material purpose.

☐ § 19-3B-411(b) — Termination by All Beneficiaries. This is a noncharitable irrevocable trust. All beneficiaries consent (Exhibit C). Continuance of the Trust is NOT necessary to achieve any material purpose because: [________________________________].

☐ § 19-3B-411(b) — Modification by All Beneficiaries. This is a noncharitable irrevocable trust. All beneficiaries consent (Exhibit C). The proposed modification is NOT inconsistent with a material purpose of the Trust because: [________________________________].

☐ § 19-3B-411(e) — Non-Consenting Beneficiary. One or more beneficiaries do not consent. Their identities are: [________________________________]. Petitioner alleges that (i) the trust could have been modified or terminated had all beneficiaries consented, AND (ii) the interests of the non-consenting beneficiaries will be adequately protected because: [________________________________].

B. § 19-3B-412 — Unanticipated Circumstances or Inability to Administer Effectively

☐ Owing to circumstances NOT anticipated by the Settlor, modification or termination of the Trust will further the purposes of the Trust. The unanticipated circumstances are: [________________________________].

☐ Modification of administrative terms is requested because continuation of the Trust on its existing terms would be impracticable or wasteful or would impair the Trust's administration. The administrative impairment is: [________________________________].

☐ To the extent practicable, the modification is consistent with the Settlor's probable intention.

C. § 19-3B-413 — Cy Pres (Charitable Trusts Only)

☐ A particular charitable purpose of the Trust has become unlawful, impracticable, impossible to achieve, or wasteful. That purpose is: [________________________________].

☐ Petitioner requests that the Court apply trust property cy pres in a manner consistent with the Settlor's charitable intent, specifically: [________________________________].

☐ Notice has been or will be given to the Alabama Attorney General pursuant to § 19-3B-110 / § 19-3B-405.

D. § 19-3B-414 — Uneconomic Trust

☐ Trustee non-court action (§ 19-3B-414(a), (e)). The total value of the Trust property is less than the Treasurer-published, annually adjusted threshold for the year of valuation (threshold: $[__________]; current trust value: $[__________]). After notice to qualified beneficiaries, Petitioner-Trustee has concluded that the value is insufficient to justify the cost of administration. This petition is filed for judicial confirmation or for an order under § 19-3B-414(b).

☐ Court order (§ 19-3B-414(b)). Petitioner requests the Court to [☐ modify; ☐ terminate; ☐ remove the trustee and appoint a different trustee] because the value of the Trust is insufficient to justify the cost of administration.

☐ Petitioner agrees to distribute trust property in a manner consistent with the purposes of the Trust pursuant to § 19-3B-414(c).

E. § 19-3B-415 — Reformation to Correct Mistake

☐ The Court may reform the terms of the Trust, even if unambiguous, to conform to the Settlor's intent. Petitioner will prove by CLEAR AND CONVINCING EVIDENCE that both the Settlor's intent and the terms of the Trust were affected by a mistake of fact or law, whether in expression or inducement. The mistake and the Settlor's true intent are set forth in Section V and Exhibits [____].

F. § 19-3B-416 — Modification to Achieve Settlor's Tax Objectives

☐ The proposed modification is necessary or appropriate to achieve the Settlor's tax objectives, including: [☐ qualifying for federal estate tax marital deduction; ☐ qualifying for federal charitable deduction; ☐ preserving GST exemption / grandfathered status; ☐ qualifying as a Qualified Subchapter S Trust (QSST); ☐ qualifying as a Special Needs Trust under 42 U.S.C. § 1396p(d)(4); ☐ other: ____________].

☐ The modification is not contrary to the Settlor's probable intention; Petitioner requests retroactive effect to [__/__/____] as permitted by § 19-3B-416.

G. § 19-3B-111 — Nonjudicial Settlement Agreement (Alternative)

☐ The interested persons have executed a binding Nonjudicial Settlement Agreement (Exhibit D) and request judicial approval under § 19-3B-111(e). The NJSA does not violate any material purpose and includes only terms that could be properly approved by a court.

V. FACTUAL BACKGROUND

4. The Trust was established by [________________________________] (the "Settlor") by instrument dated [__/__/____], a true and correct copy of which is attached as Exhibit A.

5. The Settlor [☐ is living and competent; ☐ is living but incapacitated; ☐ died on __/__/____].

6. The original Trustee was [________________________________]. The current acting Trustee(s) is/are [________________________________], having accepted office on [__/__/____].

7. The Trust currently holds assets with an approximate fair market value of $[__________], described in the inventory attached as Exhibit B.

8. The material purposes of the Trust, as expressed in the trust instrument or as may be inferred from its terms and the surrounding circumstances, are:
   (a) [________________________________]
   (b) [________________________________]
   (c) [________________________________]

9. Petitioner is informed and believes, and on that basis alleges, the following operative facts giving rise to this petition:

[________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________]

10. Specifically, with respect to consent, material purpose, unanticipated circumstances, mistake, charitable purpose, or tax objective (as relevant to the statutory basis checked in Section IV):

[________________________________________________________________________
________________________________________________________________________
________________________________________________________________________]

11. The position of each qualified beneficiary as to the proposed modification or termination is summarized in Section VI and, where applicable, in the written consents attached as Exhibit C.

VI. PARTIES; QUALIFIED BENEFICIARIES; PERSONS ENTITLED TO NOTICE

Pursuant to the AUTC and the rules of this Court, notice of this petition and the hearing has been or will be served on each of the following:

A. Trustees

B. Qualified Beneficiaries (§ 19-3B-103(15))

C. Settlor

☐ Settlor (if living): [________________________________], Address: [________________________________]
☐ Conservator/Guardian of Settlor (if any): [________________________________]

D. Alabama Attorney General (if charitable interest implicated)

☐ Office of the Attorney General, State of Alabama, 501 Washington Avenue, P.O. Box 300152, Montgomery, AL 36130-0152 — required under Ala. Code § 19-3B-110 and § 19-3B-405 for any charitable trust matter.

E. Persons Under Legal Disability — Representation Under §§ 19-3B-301 to 19-3B-305

☐ Minor beneficiaries (list): [________________________________]
☐ Beneficiaries lacking capacity (list): [________________________________]
☐ Unborn or unascertained beneficiaries

Petitioner requests that the Court [☐ approve representation by a holder of a power of appointment under § 19-3B-302; ☐ approve representation by a fiduciary or parent under § 19-3B-303; ☐ approve representation by a person with a substantially identical interest under § 19-3B-304; ☐ appoint a representative under § 19-3B-305 to represent and bind the interests of: ____________].

VII. PROPOSED MODIFICATION OR TERMINATION TERMS

12. Petitioner proposes the following specific modification, reformation, cy pres application, or termination of the Trust:

A. If Modification or Reformation:

B. If Termination:

☐ The Trust shall terminate effective [__/__/____].

☐ The Trustee shall, after payment of all debts, taxes, expenses, and reasonable fees, distribute the remaining trust property under the applicable provision: [☐ § 19-3B-411(d), as agreed by the beneficiaries; ☐ § 19-3B-412(c) or § 19-3B-414(c), in a manner consistent with the Trust's purposes], as follows: [____________ (identify recipients, shares, and specific assets)].

☐ The Trustee shall continue to have the powers reasonably necessary to wind up the affairs of the Trust under § 19-3B-817.

C. If Cy Pres Application (Charitable Trust):

☐ Trust property shall be applied to the following alternative charitable purpose, which is consistent with the Settlor's general charitable intent: [________________________________].

D. Effect on Material Purpose

The proposed modification/termination is consistent with — or, alternatively, where the statute permits, overrides — the Settlor's material purpose because: [________________________________].

VIII. PRIOR PROCEEDINGS AND RELATED MATTERS

13. There are no prior court proceedings concerning this Trust except: [☐ None ☐ Case No. ____________ in [court], styled [____________]].

14. There is no pending litigation involving the Trust or its assets except: [☐ None ☐ ____________].

15. No trust protector or other powerholder identified in the trust instrument has acted (or any available action by such powerholder has been considered and is insufficient) to address the issue in this petition, OR the action taken is as follows: [☐ N/A ☐ ____________].

IX. ATTORNEY'S FEES AND COSTS

16. Ala. Code § 19-3B-1004 is reserved and supplies no attorney-fee authority. Petitioner requests attorney's fees only if the following independent authority applies and is pleaded and proved: [IDENTIFY STATUTE, CONTRACT TERM, OR OTHER AUTHORITY / NONE].

17. If independent authority permits a fee award, Petitioner requests allocation as follows: [☐ the Trust as a whole; ☐ specific shares as the Court directs; ☐ another party under the identified authority; ☐ not requested].

X. PRAYER FOR RELIEF

WHEREFORE, Petitioner prays that the Court enter an order:

A. Finding that the Court has jurisdiction under § 19-3B-203 and that all qualified beneficiaries and other persons entitled to notice have been duly served;

B. Finding that the statutory grounds for relief checked in Section IV are satisfied, including specific findings as required by §§ 19-3B-411 (material purpose), 19-3B-412 (unanticipated circumstances), 19-3B-413 (cy pres), 19-3B-414 (uneconomic), 19-3B-415 (clear-and-convincing mistake), or 19-3B-416 (settlor's tax objectives), as applicable;

C. ☐ Modifying the Trust as set forth in Section VII.A;

D. ☐ Reforming the Trust under § 19-3B-415 to conform to the Settlor's actual intent as set forth in Section VII.A;

E. ☐ Modifying the Trust under § 19-3B-416 to achieve the Settlor's tax objectives, with retroactive effect to [__/__/____];

F. ☐ Terminating the Trust effective [__/__/____] and directing distribution under the applicable provision stated in Section VII.B;

G. ☐ Applying trust property cy pres under § 19-3B-413 to the alternative charitable purpose set forth in Section VII.C;

H. ☐ Approving the Nonjudicial Settlement Agreement attached as Exhibit D under § 19-3B-111(e);

I. ☐ Appointing a representative under § 19-3B-305 for any minor, incapacitated, unborn, or unascertained beneficiary;

J. Approving the Trustee's account, if filed concurrently, and discharging the Trustee from liability for acts taken in accordance with the Court's order;

K. ☐ Awarding attorney's fees and costs only under the independent authority identified in Section IX and only after the Court makes every finding that authority requires;

L. Granting such other and further relief as the Court deems just and proper.

XI. VERIFICATION

STATE OF ALABAMA
COUNTY OF [____________]

I, [________________________________], being first duly sworn, depose and state under oath that I am the Petitioner in this matter; that I have read the foregoing Petition to Modify or Terminate Trust; and that the factual allegations stated herein are true and correct of my own knowledge, except as to matters stated on information and belief, and as to those matters I believe them to be true.

Signature of Petitioner: ______________________________

Printed Name: [________________________________]

Sworn to and subscribed before me this [____] day of [____________], 20[____].

______________________________
Notary Public
My Commission Expires: [__/__/____]

[NOTARY SEAL]

XII. SIGNATURE OF ATTORNEY

Respectfully submitted,

Dated: [__/__/____]

________________________________
[Attorney Name]
Alabama Bar No. [____________]
[Firm Name]
[Address]
[Telephone] | [Email]
Attorney for Petitioner

EXHIBITS

• Exhibit A: Trust Instrument dated [__/__/____] and all amendments
• Exhibit B: Inventory of Trust Assets as of [__/__/____]
• Exhibit C: Written consents of settlor and/or qualified beneficiaries (§ 19-3B-411)
• Exhibit D: Nonjudicial Settlement Agreement, if any (§ 19-3B-111)
• Exhibit E: Evidence of changed circumstances / mistake / charitable / tax-objective basis
• Exhibit F: Order appointing conservator/guardian of settlor (if applicable)
• Exhibit G: Notice list and proof of service
• Exhibit H: [Other supporting documentation]

CERTIFICATE OF SERVICE

I certify that on [__/__/____], I caused a true and correct copy of the foregoing Petition to Modify or Terminate Trust, together with all exhibits and any Notice of Hearing, to be served on each person identified in Section VI in the manner indicated below.

________________________________
[Name of Person Serving]
[Address]
[Telephone]

ALABAMA-SPECIFIC PRACTICE NOTES

• Filing court (§ 19-3B-203): Circuit Court has exclusive jurisdiction over inter vivos trust administration proceedings; Probate Court has concurrent jurisdiction only if it has been granted statutory equitable jurisdiction (e.g., Jefferson, Mobile, Shelby, Pickens, and Houston Counties). Testamentary trusts: file in the Probate Court that admitted the will (or Circuit Court if removed there under § 12-11-41).
• Venue (§ 19-3B-204): county of the principal place of administration; or the court in which the Settlor's will was admitted to probate (testamentary).
• § 19-3B-411(a) — settlor + all beneficiaries: Alabama follows the UTC; the court "shall" approve even if contrary to a material purpose. This is a powerful tool when the settlor is living and willing.
• § 19-3B-411(b) — beneficiary-only termination: Requires the court to find continuance not necessary to achieve any material purpose. Spendthrift clauses do NOT automatically constitute a material purpose under Alabama law (cf. § 19-3B-411 comment), though they may be evidence of one.
• § 19-3B-411(e) — non-consenting beneficiaries: Court may still grant relief if the non-consenters' interests are adequately protected (e.g., by setting aside funds, providing security, or carving out their shares).
• § 19-3B-412 — equitable deviation: Show (1) circumstances not anticipated by settlor, and (2) modification/termination will FURTHER (not merely not defeat) trust purposes. Administrative-only modifications have a lower threshold.
• § 19-3B-414 uneconomic trust: The 2023 statutory base was $100,000; subsection (e) adjusts the threshold annually. Check the Treasurer-published amount for the valuation year before using the trustee route under subsection (a). The court route under subsection (b) is available when the trust value is insufficient to justify administration costs.
• § 19-3B-415 reformation: Clear-and-convincing standard. Available even for UNAMBIGUOUS instruments — Alabama follows Restatement (Third) of Property § 12.1.
• § 19-3B-416 tax modification: Retroactive effect allowed. Common uses: GST grandfathering, marital deduction fixes, QSST/ESBT elections, special needs trust qualification.
• § 19-3B-111 NJSA: Powerful nonjudicial alternative — consider whether court filing can be avoided through an NJSA among interested persons. NJSA cannot violate a material purpose and must include only terms a court could properly approve.
• Charitable trusts (§ 19-3B-110 / § 19-3B-405): Alabama Attorney General must be given notice of any judicial proceeding involving a charitable trust; failure is grounds to set aside any order.
• Decanting (§ 19-3B-418): Alabama authorizes decanting by a trustee with discretionary distribution authority — often an alternative to a court petition.
• Removal of trustee (§ 19-3B-706): If the petition seeks both modification AND removal of trustee, plead the § 19-3B-706 grounds separately.
• No-contest clauses (§ 19-3B-1014): Penalty clauses are generally enforceable; good-faith petitions raising a substantial issue may not trigger forfeiture, but confirm by analyzing the specific clause.
• Statute of limitations (§ 19-3B-1005): Beneficiary claims against trustees are subject to a two-year limitation period from receipt of report disclosing the matter.

SOURCES AND REFERENCES

• Ala. Code §§ 19-3B-101 et seq. (Alabama Uniform Trust Code)
• Ala. Code § 19-3B-111 (Nonjudicial Settlement Agreements)
• Ala. Code § 19-3B-203 (Subject Matter Jurisdiction)
• Ala. Code § 19-3B-204 (Venue)
• Ala. Code § 19-3B-301 to 19-3B-305 (Representation)
• Ala. Code §§ 19-3B-410 to 19-3B-416 (Modification and Termination of Trusts); § 19-3B-417 (Combination and Division)
• Ala. Code § 19-3B-418 (Decanting)
• Ala. Code § 19-3B-706 (Removal of Trustee)
• Ala. Code § 19-3B-1004 (Reserved; not attorney-fee authority)
• Ala. Code § 19-3B-1005 (Limitation of Actions Against Trustee)
• Ala. Code § 19-3B-1014 (No-Contest Clauses)
• Restatement (Third) of Trusts §§ 65-66 (Modification, Termination)
• Restatement (Third) of Property: Wills and Donative Transfers § 12.1 (Reformation)
• UTC §§ 410-417 (Uniform Trust Code Comments)
• Bogert, The Law of Trusts and Trustees §§ 991-1011