128.375] ����� 130.535 Revocation by divorce or annulment. (1) Unless otherwise provided by the terms of the trust instrument, a settlor�s divorce or the annulment of the settlor�s marriage, after

128.375]

����� 130.535 Revocation by divorce or annulment. (1) Unless otherwise provided by the terms of the trust instrument, a settlor�s divorce or the annulment of the settlor�s marriage, after the trust instrument is executed:

����� (a) Revokes all provisions of the trust in favor of the former spouse of the settlor;

����� (b) Revokes all powers of appointment, general or nongeneral, in the trust that are exercisable by the former spouse; and

����� (c) Revokes any provision in the trust naming the former spouse as trustee.

����� (2) Unless otherwise provided by the terms of the trust instrument, a trust shall be construed as though the former spouse predeceased the settlor if, after the trust instrument is executed, the settlor divorces the spouse or the marriage of the settlor to the spouse is annulled. [Formerly 128.378]

����� 130.540 Contract of sale of property not revocation. Unless otherwise provided by the terms of the trust instrument, a contract of sale made by a trustee to convey property that is the subject of a specific distribution is not a revocation of the specific distribution. If all or part of the property that is the subject of the contract of sale has not been delivered at the time set in the trust instrument for the specific distribution, the property passes by the specific distribution but is subject to the terms of the contract of sale. [Formerly 128.380]

����� 130.545 Encumbrance or disposition of property after trust instrument executed. Unless otherwise provided by the terms of the trust instrument:

����� (1) A disposition of a portion of property that is subject to a specific distribution does not affect the operation of the trust upon the remaining portion of the property; and

����� (2) If property subject to a specific distribution is encumbered, the property passes under the specific distribution but is subject to the encumbrance. [Formerly 128.382]

����� 130.550 When trust assets pass to descendants of beneficiary; class gifts. Unless otherwise provided by the terms of the trust instrument, when property is to be distributed under the trust to any beneficiary who is related by blood or adoption to the settlor, and the beneficiary dies leaving lineal descendants either before the settlor dies or before the time set in the trust instrument for distribution, the descendants take by right of representation the property the beneficiary would have taken if the beneficiary had not died. Unless otherwise provided by the terms of the trust instrument, this section applies to a beneficiary who is entitled to receive property under a class gift if the beneficiary dies after the trust instrument is executed. [Formerly 128.385]

����� 130.555 Children of settlors; pretermitted children. (1) As used in this section, �pretermitted child� means a child of a settlor who, after the execution of the trust instrument, is born or adopted during the lifetime of the settlor or is in gestation at the time of the settlor�s death, who is not acknowledged or mentioned, either by name or by class, in the trust instrument or in the settlor�s will, and who survives the settlor.

����� (2) If a settlor has one or more children living when the settlor executes a trust instrument and no provision is made in the trust for any of those children, a pretermitted child is not entitled to any share of the trust estate.

����� (3) If a settlor has one or more children living when the settlor executes a trust instrument and provision is made in the trust for any of those children, a pretermitted child is entitled to share in the trust estate as follows:

����� (a) The pretermitted child may share only in the portion of the trust estate intended to benefit living children.

����� (b) The share of each pretermitted child is equal to the total value of the portion of the trust estate intended to benefit the living children divided by the number of pretermitted children plus the number of living children for whom provision, other than nominal provision, is made in the trust.

����� (c) To the extent possible, the interest of each pretermitted child in the trust estate shall be of the same character, whether equitable or legal, as the interest the settlor gave to the living children under the trust.

����� (4) If a settlor has no child living when the settlor executes a trust instrument, the pretermitted children are entitled to the following share of the trust estate:

����� (a) If the settlor dies leaving a surviving spouse and all pretermitted children are the issue of the surviving spouse, the pretermitted children are not entitled to any share of the trust estate.

����� (b) If the settlor dies leaving a surviving spouse and not all pretermitted children are the issue of the surviving spouse, the pretermitted children, as a class, are entitled to one-half of the trust estate, with shares of the trust to be divided equally.

����� (c) If the settlor dies without leaving a surviving spouse, the pretermitted children are entitled to the entire trust estate, with shares of the trust to be divided equally.

����� (5) A pretermitted child may recover the share of the trust estate to which the child is entitled as follows:

����� (a) If the pretermitted child is entitled to a share of the trust estate under subsection (3) of this section, the share must be recovered from the other children.

����� (b) If the pretermitted child is entitled to a share of the trust estate under subsection (4) of this section, the share must be recovered from the beneficiaries on a pro rata basis, out of the portions of the trust estate passing to those persons under the trust.

����� (c) In reducing the shares of the beneficiaries under this subsection, the character of the dispositive plan adopted by the settlor in the trust must be preserved to the extent possible. [Formerly 128.388; 2013 c.529 �11]

����� 130.560 Failure of specific distribution. (1) Subject to this section, a specific distribution does not fail by reason of the destruction, damage, sale, condemnation or change in form of the property that is the subject of the specific distribution unless:

����� (a) The trust instrument provides that the specific distribution fails under the particular circumstances; or

����� (b) The settlor, during the lifetime of the settlor, or the trustee gives property to the beneficiary of the specific distribution with the intent of satisfying the specific distribution.

����� (2) If part of the property that is the subject of a specific distribution is destroyed, damaged, sold or condemned, the remaining interest in the property passes pursuant to the specific distribution. The part of the property that is destroyed, damaged, sold or condemned is subject to subsections (3) to (6) of this section if the property would have been adeemed under the common law had the property been subject to probate in the settlor�s estate.

����� (3) If property that is the subject of a specific distribution is insured and the property is destroyed or damaged, the beneficiary of the specific distribution is entitled to receive the following amounts, less any amount expended or incurred by the settlor or trust estate in restoration or repair of the property:

����� (a) Any insurance proceeds for the destroyed or damaged property unpaid at the time set in the trust instrument for the specific distribution; and

����� (b) An amount equal to all insurance payments paid to the settlor, and such proceeds or awards paid to the trustee for the destroyed or damaged property, during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.

����� (4) If property that is the subject of a specific distribution is sold by the settlor or the trustee, the beneficiary of the specific distribution is entitled to receive:

����� (a) Any balance of the purchase price unpaid at the time set in the trust instrument for the specific distribution, including any security interest in the property and interest accruing before the time set in the trust instrument for the specific distribution; and

����� (b) An amount equal to all payments paid to the settlor or the trustee for the property during the six-month period immediately preceding the time set in the trust instrument for the specific distribution. Acceptance of a promissory note of the purchaser or a third party is not considered payment under this paragraph, but payment on the note is payment on the purchase price.

����� (5) If property that is the subject of a specific distribution is taken by condemnation before the time set in the trust instrument for the specific distribution, the beneficiary of the specific distribution is entitled to receive:

����� (a) Any amount of the condemnation award unpaid at the time set in the trust instrument for the specific distribution; and

����� (b) An amount equal to the sums paid under the condemnation award to the settlor or the trustee during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.

����� (6) If securities as defined in ORS 59.015 are the subject of a specific distribution, and after the execution of the trust instrument other securities of the same or another entity are distributed to the trustee or trust estate by reason of a partial liquidation, stock dividend, stock split, merger, consolidation, reorganization, recapitalization, redemption, exchange or any other similar transaction, the specific distribution includes the additional or substituted securities.

����� (7) The amount that a beneficiary of a specific distribution receives under this section must be reduced by any expenses of the sale or of the collection of the proceeds of insurance, sale or condemnation award and by any amount by which income is increased by reasons of items provided for in this section. Expenses subject to this subsection include attorney fees. [Formerly 128.390]

����� 130.565 Effect of failure of specific distribution. If a specific distribution, other than a specific distribution that governs the residue of the trust estate, fails for any reason, the property that is the subject of the specific distribution becomes part of the residue and must be distributed as provided by the terms of the trust instrument for the residue. [Formerly