36C-5-506. Overdue distribution.
(a) In this section, "mandatory distribution" means a distribution of income or principal that the trustee is required to make to a beneficiary under the terms of the trust, including a distribution upon termination of the trust. The term excludes a distribution subject to the exercise of the trustee's discretion, regardless of whether the terms of the trust (i) include a support or other standard to guide the trustee in making distribution decisions; or (ii) provide that the trustee "may" or "shall" make discretionary distributions, including distributions under a support or other standard.
(b) Whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution upon termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the designated distribution date. (2005-192, s. 2.)
Structure North Carolina General Statutes
North Carolina General Statutes
Chapter 36C - North Carolina Uniform Trust Code
Article 5 - Creditors' Claims; Spendthrift and Discretionary Trusts.
§ 36C-5-501 - Rights of beneficiary's creditor or assignee.
§ 36C-5-502 - Spendthrift provision.
§ 36C-5-503 - Exceptions to spendthrift provision.
§ 36C-5-504 - Discretionary trusts; effect of standard.
§ 36C-5-505 - Creditor's claim against settlor.
§ 36C-5-506 - Overdue distribution.