Petition to Modify or Terminate Trust (Colorado)

PETITION TO MODIFY OR TERMINATE TRUST

(C.R.S. §§ 15-5-410, -411, -412, -413, -414, -415, -416)

COURT INFORMATION

DISTRICT COURT, [____________] COUNTY, COLORADO
(Or: DENVER PROBATE COURT, CITY AND COUNTY OF DENVER, COLORADO)

PROBATE DIVISION

Court Address: [________________________________]

Case Number: [________________________________]

Division / Courtroom: [________________________________]

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 [________________________________])
☐ Charitable Trust (assess Attorney General notice rights under § 15-5-110(4))
☐ Special Needs Trust (42 U.S.C. § 1396p(d)(4))
☐ 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 of the Settlor (court order dated [__/__/____])
☐ Guardian of the Settlor (court order dated [__/__/____])
☐ Beneficiary — current income / mandatory distribution
☐ Beneficiary — discretionary distribution
☐ Qualified beneficiary (§ 15-5-103(16))
☐ Beneficiary — remainder / contingent
☐ Attorney-in-Fact for Settlor (express modification authority in POA at § [____])
☐ Other: [________________________________]

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

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

Attorney for Petitioner:
Name: [________________________________]
Colorado Atty. Reg. No.: [________________________________]
Firm: [________________________________]
Address: [________________________________]
Telephone: [(___) ___-____] Email: [________________________________]

II. TRUST IDENTIFICATION

Full Legal Name of Trust: [________________________________]

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

Amendments / Restatements (list date and exhibit reference):

1. [__/__/____] — Amendment No. [__], attached as Exhibit [__]
2. [__/__/____] — Restatement, attached as Exhibit [__]

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: Colorado Uniform Trust Code, C.R.S. § 15-5-101 et seq.

Principal Place of Administration: [County of ____________], Colorado

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. This Court has subject-matter jurisdiction over this proceeding under C.R.S. § 15-5-203 (subject-matter jurisdiction over proceedings concerning trusts) and § 15-5-201 (role of court in administration of trust). The District Court has trust jurisdiction; in Denver County, the Denver Probate Court has exclusive jurisdiction (C.R.S. § 13-9-103).

2. Venue is proper in this county pursuant to C.R.S. § 15-5-204 because [☐ the principal place of administration of the Trust is in this county; ☐ a trustee resides in this county; ☐ the Trust property is located in this county; ☐ other: ____________].

3. Petitioner has standing to bring this petition as [☐ a trustee under § 15-5-201; ☐ a qualified beneficiary entitled to notice under §§ 15-5-103(16) and 15-5-813; ☐ the settlor or settlor's fiduciary under § 15-5-411(1)].

IV. STATUTORY BASIS FOR RELIEF

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

A. § 15-5-411(1) — Modification or Termination by Settlor and All Beneficiaries

☐ The Settlor is living and competent (or consent is given by an agent under a POA expressly so authorized, the settlor's conservator with court approval, or the settlor's guardian with court approval).

☐ The Settlor and ALL beneficiaries consent in writing to the proposed modification or termination. Written consents are attached as Exhibit C.

☐ Under § 15-5-411(1), the Court SHALL approve the modification or termination even if inconsistent with a material purpose of the Trust.

B. § 15-5-411(2) — Modification or Termination by All Beneficiaries (Without Settlor)

☐ The Trust is NOT a trust established by court order under Title XIX of the federal Social Security Act, 42 U.S.C. § 1396p(d)(4).

☐ All beneficiaries consent in writing (attached as Exhibit C).

☐ Continuance of the Trust is NOT necessary to achieve any material purpose of the Trust (for termination); OR

☐ The proposed modification is NOT inconsistent with a material purpose of the Trust (for modification).

C. § 15-5-411(3) — Spendthrift Provision

☐ The Trust [☐ does not ☐ does] contain a spendthrift provision. Under § 15-5-411(3), a spendthrift provision is not presumed to constitute a material purpose of the trust. Petitioner alleges the following with respect to the settlor's material purposes: [________________________________].

D. § 15-5-411(5) — Less-Than-Unanimous Beneficiary Consent

☐ Not all beneficiaries consent. The non-consenting beneficiaries are: [________________________________].

☐ If all beneficiaries had consented, the Trust could have been modified or terminated under § 15-5-411(1) or (2).

☐ The interests of the non-consenting beneficiaries will be ADEQUATELY PROTECTED by the proposed modification or termination because: [________________________________].

E. § 15-5-412 — Unanticipated Circumstances or Inability to Administer Effectively

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

☐ Continuation of the Trust on its existing terms would be impracticable, wasteful, or impair the Trust's administration because: [________________________________].

☐ To the extent practicable, modification will be made in accordance with the Settlor's probable intention.

F. § 15-5-413 — Cy Pres (Charitable Trusts Only)

☐ The Trust is a charitable trust. A particular charitable purpose has become [☐ unlawful; ☐ impracticable; ☐ impossible to achieve; ☐ wasteful] because: [________________________________].

☐ The Court is requested to apply cy pres to modify or terminate the Trust by directing application of trust property to a charitable purpose that reasonably approximates the Settlor's charitable intent.

☐ If this is a charitable trust with its principal place of administration in Colorado, the Colorado Attorney General has been given notice as a qualified beneficiary under C.R.S. § 15-5-110(4).

G. § 15-5-414 — Uneconomic Trust

☐ The fair market value of the Trust is $[__________].

☐ Value is less than $100,000 — trustee termination authority. After notice to qualified beneficiaries, the Trustee has determined (or seeks confirmation) that the value of the Trust property is insufficient to justify the cost of administration, and may terminate under § 15-5-414(1).

☐ Court relief regardless of $100,000 threshold. The Court is requested to modify or terminate the Trust, or remove the Trustee and appoint a different trustee, because the value of the Trust property is insufficient to justify the cost of administration under § 15-5-414(2).

☐ The Trust is NOT a conservation or preservation easement (§ 15-5-414(4)).

H. § 15-5-415 — Reformation for Mistake

☐ A mistake of fact or law (whether in expression or inducement) caused the Trust's terms to depart from the Settlor's actual intent. Clear and convincing evidence of the Settlor's actual intent and of the mistake is set out in Section V and Exhibits [____].

I. § 15-5-416 — Modification to Achieve Settlor's Tax Objectives

☐ The proposed modification is necessary or appropriate to achieve the Settlor's tax objectives, including: [☐ qualifying for marital deduction; ☐ qualifying for charitable deduction; ☐ preserving GST exemption / grandfathered status; ☐ qualifying as a Qualified Subchapter S Trust; ☐ qualifying as a Special Needs Trust; ☐ other: ____________].

☐ The modification is not contrary to the Settlor's probable intention.

☐ Petitioner requests that any modification be given retroactive effect under § 15-5-416 to achieve the Settlor's tax objectives.

J. § 15-5-111 — Nonjudicial Settlement Agreement (Alternative)

☐ In the alternative or as a supplement, Petitioner has executed (or proposes to execute) a Nonjudicial Settlement Agreement under § 15-5-111 attached as Exhibit H, and seeks court approval (if desired) to determine the NJSA does not violate a material purpose and contains terms a court could properly approve.

K. C.R.S. § 15-16-901 et seq. — Colorado Uniform Trust Decanting Act (Alternative)

☐ In the alternative, Petitioner has determined (or proposes) that the authorized fiduciary may decant the Trust under the Colorado Uniform Trust Decanting Act, C.R.S. § 15-16-901 et seq., by distributing trust property to a second trust. A copy of the proposed second trust is attached as Exhibit I, and notice has been or will be given under § 15-16-907. Petitioner [☐ seeks court approval of decanting under § 15-16-909; ☐ files this petition only if decanting is unavailable or contested].

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 principal purposes of the Trust, as expressed in the trust instrument, 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 material purposes, unanticipated circumstances, mistake, tax objectives, or uneconomic administration (as relevant to the statutory basis checked in Section IV):

[________________________________________________________________________
________________________________________________________________________
________________________________________________________________________]

11. The position of each 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; BENEFICIARIES; PERSONS ENTITLED TO NOTICE

Pursuant to C.R.S. §§ 15-5-109 and 15-5-813, notice of this petition and of the hearing has been or will be served on each of the following:

A. Trustees

B. Qualified Beneficiaries (§ 15-5-103(16))

C. Settlor

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

D. Colorado Attorney General (if charitable interest is implicated)

☐ Office of the Attorney General, State of Colorado — notice given as applicable under C.R.S. § 15-5-110(4). Confirm the current service address.

E. Persons Under Legal Disability — Representation Under §§ 15-5-301 to -305

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

Petitioner requests that the Court [☐ approve virtual representation under §§ 15-5-301 to -305; ☐ appoint a guardian ad litem under C.R.S. § 15-10-403 and C.R.C.P. 17(c) to represent the interests of: ____________].

VII. PROPOSED MODIFICATION OR TERMINATION TERMS

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

A. If Modification or Reformation:

The following provisions of the Trust shall be modified to read as follows:

B. If Termination:

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

☐ The Trustee shall, after payment of all debts, taxes, expenses, and fees, distribute the remaining trust property in a manner consistent with the purposes of the Trust (§§ 15-5-411(4), 15-5-414(3), 15-5-817) as follows: [____________ (set forth distribution scheme, identifying recipients, shares, and any specific assets)].

☐ The Trustee shall continue to have the powers reasonably necessary to wind up the affairs of the Trust.

C. Effect on Material Purpose

The proposed modification/termination is consistent with — or, alternatively, where necessary, 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 / directed trustee designee has acted (or available action is insufficient) to address the issue in this petition, OR the trust protector has acted as follows: [☐ N/A ☐ ____________].

16. No nonjudicial settlement agreement under § 15-5-111 has been executed concerning the matter, OR an NJSA has been executed and is attached as Exhibit H.

17. The Colorado Uniform Trust Decanting Act remedy (§ 15-16-901 et seq.) [☐ has been used and is attached as Exhibit I; ☐ has been considered and is unavailable because: ____________; ☐ is not applicable].

IX. ATTORNEY'S FEES AND COSTS

18. Petitioner has incurred, and will continue to incur, reasonable attorney's fees and costs in bringing this petition for the benefit of the Trust and its beneficiaries, recoverable under C.R.S. § 15-10-602 (attorney fees in probate matters) and § 15-5-1004 (CUTC attorney fees provision) and the common-benefit doctrine.

19. Petitioner requests such fees and costs be charged against [☐ the Trust as a whole; ☐ specific shares as the Court directs; ☐ another party if the Court finds bad-faith opposition].

X. PRAYER FOR RELIEF

WHEREFORE, Petitioner prays that the Court enter an order:

A. Finding that the Court has jurisdiction under §§ 15-5-201 and 15-5-203 and that all persons entitled to notice under §§ 15-5-109 and 15-5-813 have been duly served;

B. Finding that the statutory grounds for relief checked in Section IV are satisfied, including specific findings as to material purpose (§ 15-5-411), unanticipated circumstances (§ 15-5-412), uneconomic administration (§ 15-5-414), mistake (§ 15-5-415), and/or tax objectives (§ 15-5-416), as applicable;

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

D. ☐ Reforming the Trust under § 15-5-415 to conform to the Settlor's actual intent as set forth in Section VII.A;

E. ☐ Modifying the Trust under § 15-5-416 to achieve the Settlor's tax objectives, with retroactive effect to [__/__/____];

F. ☐ Terminating the Trust effective [__/__/____] under § 15-5-411 / § 15-5-412 / § 15-5-414 and directing distribution as set forth in Section VII.B;

G. ☐ Approving cy pres modification or termination under § 15-5-413 as set forth in Section VII.A;

H. ☐ Approving any Nonjudicial Settlement Agreement under § 15-5-111 attached as Exhibit H;

I. ☐ Approving decanting under the Colorado Uniform Trust Decanting Act, C.R.S. § 15-16-901 et seq., as set forth in Exhibit I;

J. ☐ Approving virtual representation under §§ 15-5-301 to -305 or appointing a guardian ad litem under C.R.S. § 15-10-403 for any minor, incapacitated, unborn, or unascertained beneficiary;

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

L. Awarding Petitioner's reasonable attorney's fees and costs payable from the Trust under §§ 15-10-602 and 15-5-1004 and common-benefit principles;

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

XI. VERIFICATION

I, [________________________________], am the Petitioner and have read the foregoing Petition to Modify or Terminate Trust. I declare under penalty of perjury under the law of Colorado that the foregoing factual allegations are true and correct.

Executed on [__/__/____] at [________________________________] (city), Colorado.

Signature of Petitioner: ______________________________

Printed Name: [________________________________]

XII. SIGNATURE OF ATTORNEY

Respectfully submitted,

Dated: [__/__/____]

________________________________
[Attorney Name]
Colorado Atty. Reg. 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 (if applicable under § 15-5-411)
• Exhibit D: Evidence of unanticipated circumstances / mistake / tax-objective basis (correspondence, tax returns, expert declarations)
• Exhibit E: Order appointing conservator or guardian of settlor (if applicable)
• Exhibit F: Notice list and proof of service per §§ 15-5-109 and 15-5-813
• Exhibit G: Trustee accounting (if filed concurrently)
• Exhibit H: Nonjudicial Settlement Agreement under § 15-5-111 (if applicable)
• Exhibit I: Proposed Second Trust under Colorado Uniform Trust Decanting Act, § 15-16-901 et seq. (if applicable)
• Exhibit J: [Other supporting documentation]

CERTIFICATE / PROOF 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 the Notice of Hearing, to be served on each person identified in Section VI in the manner indicated below, in accordance with C.R.C.P. 5 and the Colorado Rules of Probate Procedure.

________________________________
[Name of Person Serving]

COLORADO-SPECIFIC PRACTICE NOTES

• Filing court and venue: For a proceeding by a trustee, trust director, or beneficiary concerning trust administration, file in district court or, in Denver, the Denver Probate Court under C.R.S. § 15-5-203(1). Select the county in the order stated by § 15-5-204(1): a trust-specified county with a substantial relationship to administration, the county of trust registration, then the county of principal administration (or, for a testamentary trust, the county administering the estate). Confirm the court's current filing instructions.
• Procedure: Colorado Rules of Probate Procedure (C.R.P.C.) govern. JDF form 720 series concerns trusts but no JDF form is prescribed specifically for § 15-5-411 petitions — use captioned petition.
• CUTC effective date: Colorado Uniform Trust Code provisions in this petition took effect January 1, 2019. Check the enacting act and any transition rule before applying them to an older trust or proceeding.
• Spendthrift (§ 15-5-411(3)): A spendthrift provision is not presumed to be a material purpose. Address the settlor's actual material purposes when requesting relief under § 15-5-411(2).
• Uneconomic trust threshold (§ 15-5-414): $100,000 (not $50,000). Trustee may terminate without court order on notice to qualified beneficiaries. Court may modify/terminate or remove trustee regardless of dollar threshold where value is insufficient to justify administration costs. Excludes conservation/preservation easements (§ 15-5-414(4)).
• Reformation (§ 15-5-415): Clear and convincing evidence required. Available even for unambiguous instruments.
• Tax modifications (§ 15-5-416): Retroactive effect available. Coordinate with tax counsel for GST grandfathering, marital deduction, charitable deduction, QSST/ESBT, and SNT issues.
• NJSA (§ 15-5-111): Often the better path for non-controversial changes — avoids litigation but cannot violate material purpose or include terms a court could not approve. Court approval available for certainty.
• Decanting (§ 15-16-901 et seq.): Colorado Uniform Trust Decanting Act provides robust alternative where the authorized fiduciary has expansive (or limited) discretion. Notice required under § 15-16-907; court approval available under § 15-16-909.
• Charitable trusts (§ 15-5-110(4)): For a charitable trust with its principal place of administration in Colorado, the Attorney General has the rights of a qualified beneficiary. Provide notice when the Code requires notice to qualified beneficiaries; cy pres is addressed by § 15-5-413.
• Representation (§§ 15-5-301 to -305): Virtual representation broadly available; appoint guardian ad litem under § 15-10-403 where conflict or no adequate representative exists.
• Special Needs Trusts: Modifications to a (d)(4)(A) or (d)(4)(C) trust must preserve public benefits qualification; coordinate with Colorado HCPF. § 15-5-411(2) does NOT apply to trusts established by court order under 42 U.S.C. § 1396p(d)(4).
• No-contest clauses: C.R.S. § 15-11-517 protects a will contest supported by probable cause. That will-specific provision does not by itself establish the result for a petition concerning a trust clause; analyze the trust instrument and applicable law separately.
• Qualified beneficiaries (§ 15-5-103(16)): CUTC concept — narrower than "beneficiaries" generally; identifies the persons entitled to notice of trust administration. Includes current distributees, presumptive remainder beneficiaries, and contingent beneficiaries who would take if interests of current beneficiaries terminated.

SOURCES AND REFERENCES

• Colorado Uniform Trust Code, C.R.S. § 15-5-101 et seq. (Part 4, §§ 15-5-410 to -417)
• C.R.S. § 15-5-111 (Nonjudicial Settlement Agreements)
• C.R.S. §§ 15-5-201, -203, -204 (Jurisdiction and Venue)
• C.R.S. §§ 15-5-301 to -305 (Representation)
• C.R.S. § 15-5-813 (Duty to Inform and Report)
• C.R.S. § 15-5-1004 (Attorney's Fees and Costs)
• C.R.S. § 15-16-901 et seq. (Colorado Uniform Trust Decanting Act)
• C.R.S. §§ 15-5-110(4), 15-5-203, 15-5-204 (Attorney General rights, court jurisdiction, venue)
• C.R.S. § 15-11-517 (Will penalty clause; trust clauses require separate analysis)
• C.R.S. § 15-10-403 (Guardian Ad Litem in Probate Matters)
• C.R.S. § 15-10-602 (Attorney Fees in Probate Matters)
• Colorado Rules of Probate Procedure (C.R.P.C.)
• C.R.C.P. 5, 17 (service and capacity)
• Uniform Trust Code (2000, as amended) — official comments
• Eyster & Stevens, "The Colorado Uniform Trust Code," Colorado Lawyer (March 2019)
• Restatement (Third) of Trusts §§ 65-66 (Modification, Termination)
• Bogert, The Law of Trusts and Trustees §§ 991-1011