10:02 AM

Board approves three measures for introduction to Missouri Legislature

At its November meeting, the Board of Governors of The Missouri Bar approved three legislative proposals drafted by Missouri Bar substantive law committees, clearing the way for their consideration when the 101st General Assembly reconvenes Jan. 6, 2021. All three measures were previously introduced as Bar-endorsed legislation during the 2020 legislative session.

One of the reintroduced measures, from the Bankruptcy Creditor-Debtor Rights Committee, would revise and update Chapter 326 of the Missouri statutes relating to General Assignments for the Benefit of Creditors (“ABC”). This proposal sets jurisdiction and venue in the circuit courts; provides procedures for the recovery and distribution of assets to the assignor’s creditors; supplants common law assignments; provides required and prohibited provisions for a valid ABC; defines the rights, powers, and duties of the assignor and assignee; and regulates the priority and processing of claims against the assignor for an orderly liquidation of the assignor’s non-exempt assets. The current statutory chapter was written in 1909 and has not been substantively revised since 1939, leaving it out-of-date and diminishing its usefulness for practitioners and clients.

Another reintroduced measure, from the Probate & Trust Division, offers several technical corrections to Missouri’s decanting statute (§ 56.4 – 419, RSMo). These corrections would clarify several points, including:

  • modification of a first trust into a second trust;
  • the permissible distributees of a second trust;
  • the use of power of appointment in the second trust;
  • how a second trust may be used for disabled beneficiaries;
  • how a second trust may hold S-corporation stock;
  • notifications given to the beneficiaries of the first and second trusts; and
  • how a second trust may affect the rules governing perpetuities.

The last reintroduced proposal endorsed by the board comes from the Alternative Dispute Resolution Committee. This measure would update statutes related to mediation to help ensure that party expectations are met with regard to confidentiality and due process. In addition to establishing a new definition section, the proposal would give the courts broad discretion to order cases to mediation or other non-binding ADR processes while giving parties the option to modify that choice and/or opt out as provided by the statute. Other provisions would identify specific issues concerning what should and should not remain confidential in mediation, require a signed written agreement, and expand the statute to include pre-suit and post judgment disputes when the parties agree.

The Missouri Bar limits its legislative activities to proposed legislation that affects the administration of justice, the integrity of the judiciary, or the dignity of the profession of law. In addition, The Missouri Bar may participate in legislative activities to improve the law through legislation drafted by Missouri Bar committees and endorsed by the Board of Governors and may respond to legislation that affects previously enacted Bar-drafted legislation.