166.170 - Limitation of actions with respect to transfer of property to trust; certain transfers of property disregarded; limitation of actions against advisers to settlors or trustees.
166.170 Limitation of actions with respect to transfer of property to trust; certain transfers of property disregarded; limitation of actions against advisers to settlors or trustees.
1. A person may not bring an action with respect to a transfer of property to a spendthrift trust:
(a) If the person is a creditor when the transfer is made, unless the action is commenced within:
(1) Two years after the transfer is made; or
(2) Six months after the person discovers or reasonably should have discovered the transfer,
Ê whichever is later.
(b) If the person becomes a creditor after the transfer is made, unless the action is commenced within 2 years after the transfer is made.
2. A person shall be deemed to have discovered a transfer at the time a public record is made of the transfer, including, without limitation, the conveyance of real property that is recorded in the office of the county recorder of the county in which the property is located or the filing of a financing statement pursuant to chapter 104 of NRS.
3. A creditor may not bring an action with respect to transfer of property to a spendthrift trust unless a creditor can prove that the transfer of property was a fraudulent transfer pursuant to chapter 112 of NRS or was otherwise wrongful as to the creditor. In the absence of such proof, the property transferred is not subject to the claims of the creditor. Proof by one creditor that a transfer of property was fraudulent or wrongful does not constitute proof as to any other creditor and proof of a fraudulent or wrongful transfer of property as to one creditor shall not invalidate any other transfer of property.
4. If property transferred to a spendthrift trust is conveyed to the settlor or to a beneficiary for the purpose of obtaining a loan secured by a mortgage or deed of trust on the property and then reconveyed to the trust, for the purpose of subsection 1, the transfer is disregarded and the reconveyance relates back to the date the property was originally transferred to the trust. The mortgage or deed of trust on the property shall be enforceable against the trust.
5. A person may not bring a claim against an adviser to the settlor or trustee of a spendthrift trust unless the person can show by clear and convincing evidence that the adviser acted in violation of the laws of this State, knowingly and in bad faith, and the adviser’s actions directly caused the damages suffered by the person.
6. As used in this section:
(a) “Adviser” means any person, including, without limitation, an accountant, attorney or investment adviser, who gives advice concerning or was involved in the creation of, transfer of property to, or administration of the spendthrift trust or who participated in the preparation of accountings, tax returns or other reports related to the trust.
(b) “Creditor” has the meaning ascribed to it in subsection 4 of NRS 112.150.
(Added to NRS by 1999, 1236; A 2007, 894; 2009, 803)