Section 501 – Creditor claim — General power created by powerholder.

• (1) In this section, “power of appointment created by the powerholder” includes a power of appointment created in a transfer by another person to the extent the powerholder contributed value to the transfer.

• (2) Appointive property subject to a general power of appointment created by the powerholder is subject to a claim of a creditor of the powerholder or of the powerholder’s estate to the extent provided in Title 25, Chapter 6, Uniform Voidable Transactions Act.

• (3) Subject to Subsection (2), appointive property subject to a general power of appointment created by the powerholder is not subject to a claim of a creditor of the powerholder or the powerholder’s estate to the extent the powerholder irrevocably appointed the property in favor of a person other than the powerholder or the powerholder’s estate.

• (4) Subject to Subsections (2) and (3), and notwithstanding the presence of a spendthrift provision or whether the claim arose before or after the creation of the power of appointment, appointive property subject to a general power of appointment created by the powerholder is subject to a claim of a creditor of:
  • (a) the powerholder, to the same extent as if the powerholder owned the appointive property, if the power is presently exercisable; and
  • (b) the powerholder’s estate, to the extent the estate is insufficient to satisfy the claim and subject to the right of a decedent to direct the source from which liabilities are paid, if the power is exercisable at the powerholder’s death.

Enacted by Chapter 125, 2017 General Session