SECTION 2-704. POWER OF APPOINTMENT; MEANING OF SPECIFIC
REFERENCE REQUIREMENT Uniform Probate Code
If a governing instrument creating a power of appointment expressly requires that the power be exercised by a reference, an express reference, or a specific reference, to the power or its source, it is presumed that the donor’s intention, in requiring that the donee exercise the power by making reference to the particular power or to the creating instrument, was to prevent an inadvertent exercise of the power.
Comment
Rationale of New Section. In the creation of powers of appointment, it has become common estate-planning practice to require that the donee of the power can exercise the power only by making reference (or express or specific reference) to it. The question of whether the donee has made a sufficiently specific reference is much litigated. The precise question often is whether a so-called blanket-exercise clause (also called a blending clause) – a clause referring to
If a governing instrument creating a power of appointment expressly requires that the power be exercised by a reference, an express reference, or a specific reference, to the power or its source, it is presumed that the donor’s intention, in requiring that the donee exercise the power by making reference to the particular power or to the creating instrument, was to prevent an inadvertent exercise of the power.
Comment
Rationale of New Section. In the creation of powers of appointment, it has become common estate-planning practice to require that the donee of the power can exercise the power only by making reference (or express or specific reference) to it. The question of whether the donee has made a sufficiently specific reference is much litigated. The precise question often is whether a so-called blanket-exercise clause (also called a blending clause) – a clause referring to
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“any property over which I have a power of appointment” – constitutes a sufficient reference to a
particular power to exercise that power. E.g., First National Bank v. Walker, 607 S.W.2d 469
(Tenn. 1980), and cases cited therein.
Section 2-704 sets forth the presumption that the donor’s purpose in imposing a reference requirement was to prevent an inadvertent exercise of the power by the donee. Under this section, mere use by the donee of a blanket-exercise clause would be ineffective to exercise the power because such a clause would not make a sufficient reference to the particular power. If, however, it could be shown that the donee had knowledge of and intended to exercise the power, the blanket-exercise clause would be sufficient to exercise the power, unless the presumption of this section is overcome. Under Section 2-701, the presumption of this section would be overcome if it could be shown that the donor’s intention was not merely to prevent an inadvertent exercise of the power but was to prevent any exercise of the power, intentional or inadvertent, that failed to identify in explicit terms the specific power or the creating instrument.
Reference. See Langbein & Waggoner, “Reformation of Wills on the Ground of Mistake: Change of Direction in American Law?,” 130 U. Pa. L. Rev. 521, 583, n. 223 (1982), suggesting that a donee’s will that omits a sufficiently specific reference to a particular power can be reformed to include the necessary reference if it can be shown by clear and convincing evidence that the omission was caused by a scrivener’s mistake. This approach is not inconsistent with Section 2-704. See Sections 2-601 (and accompanying Comment); 2-701. See also Motes/Henes Trust v. Mote, 297 Ark. 380, 761 S.W.2d 938 (1988) (donee’s intended exercise given effect despite use of blanket-exercise clause); In re Strobel, 149 Ariz. 213, 717 P.2d 892 (1986) (donee’s intended exercise given effect despite defective reference to power).
Cross Reference. See Section 2-608 for a provision governing whether a general residuary clause in the donee’s will exercises a power of appointment that does not require a reference (or an express or specific reference) by the donee of the power.
Section 2-704 sets forth the presumption that the donor’s purpose in imposing a reference requirement was to prevent an inadvertent exercise of the power by the donee. Under this section, mere use by the donee of a blanket-exercise clause would be ineffective to exercise the power because such a clause would not make a sufficient reference to the particular power. If, however, it could be shown that the donee had knowledge of and intended to exercise the power, the blanket-exercise clause would be sufficient to exercise the power, unless the presumption of this section is overcome. Under Section 2-701, the presumption of this section would be overcome if it could be shown that the donor’s intention was not merely to prevent an inadvertent exercise of the power but was to prevent any exercise of the power, intentional or inadvertent, that failed to identify in explicit terms the specific power or the creating instrument.
Reference. See Langbein & Waggoner, “Reformation of Wills on the Ground of Mistake: Change of Direction in American Law?,” 130 U. Pa. L. Rev. 521, 583, n. 223 (1982), suggesting that a donee’s will that omits a sufficiently specific reference to a particular power can be reformed to include the necessary reference if it can be shown by clear and convincing evidence that the omission was caused by a scrivener’s mistake. This approach is not inconsistent with Section 2-704. See Sections 2-601 (and accompanying Comment); 2-701. See also Motes/Henes Trust v. Mote, 297 Ark. 380, 761 S.W.2d 938 (1988) (donee’s intended exercise given effect despite use of blanket-exercise clause); In re Strobel, 149 Ariz. 213, 717 P.2d 892 (1986) (donee’s intended exercise given effect despite defective reference to power).
Cross Reference. See Section 2-608 for a provision governing whether a general residuary clause in the donee’s will exercises a power of appointment that does not require a reference (or an express or specific reference) by the donee of the power.
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