The Florida Senate

737.101  Principal place of administration of trust.

737.105  Qualification of foreign trustee.

737.106  Revocable trust prior to dissolution of marriage.

737.111  Execution requirements for express trusts.

737.101  Principal place of administration of trust.--

(1)  Unless otherwise designated in the trust agreement, the principal place of administration of a trust is the trustee's usual place of business where the records pertaining to the trust are kept or, if he or she has no place of business, the trustee's residence.

(2)  If not otherwise designated in the trust instrument in the case of cotrustees, the principal place of administration is:

(a)  The usual place of business of the corporate trustee, if there is but one corporate cotrustee;

(b)  The usual place of business or residence of the individual trustee who is a professional fiduciary, if there is but one such person and no corporate cotrustee; or otherwise,

(c)  The usual place of business or residence of any of the cotrustees as agreed upon by them.

(3)  Unless otherwise designated in the trust agreement and notwithstanding any other provision of this section, the principal place of administration of a trust, for which a bank, association, or trust company organized under the laws of this state or bank or savings association organized under the laws of the United States with its main office in this state has been appointed trustee, shall not be moved or otherwise affected solely because the trustee engaged in an interstate merger transaction with an out-of-state bank pursuant to s. 658.2953 in which the out-of-state bank is the resulting bank.

History.--s. 1, ch. 74-106; s. 1, ch. 75-221; s. 1, ch. 77-344; s. 16, ch. 97-30; s. 1037, ch. 97-102.

737.105  Qualification of foreign trustee.--Unless otherwise doing business in this state, local qualification by a foreign trustee is not required in order for the trustee to receive distribution from a local estate. Nothing in this chapter shall affect the provisions of s. 660.41.

History.--s. 1, ch. 74-106; s. 1, ch. 75-221; s. 150, ch. 80-260.

737.106  Revocable trust prior to dissolution of marriage.--Unless the trust instrument or the judgment for dissolution of marriage or divorce expressly provides otherwise, if a revocable trust is executed by a husband or wife as settlor prior to entry of a judgment for dissolution of marriage or divorce of settlor from settlor's spouse, then any provision of the trust which affects the settlor's divorced spouse will become void upon entry of the judgment of dissolution of marriage or divorce, and any such trust will be administered and construed as if the settlor's divorced spouse had died upon entry of the judgment for dissolution of marriage or divorce.

History.--s. 1, ch. 89-39.

737.111  Execution requirements for express trusts.--

(1)  The testamentary aspects of a trust defined in s. 731.201(33), are invalid unless the trust instrument is executed by the settlor with the formalities required for the execution of a will.

(2)  The testamentary aspects of a trust created by a nonresident of Florida, either before or after this law takes effect, are not invalid because the trust does not meet the requirements of this section, if the trust is valid under the laws of the state or country where the settlor was at the time of execution.

(3)  The testamentary aspects of an amendment to a trust are invalid unless the amendment is executed by the settlor with the same formalities as a will.

(4)  For the purposes of this section, the term "testamentary aspects" means those provisions of the trust that dispose of the trust property on or after the death of the settlor other than to the settlor's estate.

(5)  This section shall not apply to trusts established as part of an employee annuity described in s. 403 of the Internal Revenue Code of 1986, as amended, an Individual Retirement Account as described in s. 408 of the Internal Revenue Code of 1986, as amended, a Keogh (HR-10) Plan, or a retirement or other plan that is qualified under s. 401 of the Internal Revenue Code of 1986, as amended.

(6)  This section shall not apply to trust instruments executed prior to October 1, 1995.

History.--s. 11, ch. 95-401; s. 4, ch. 97-240.

737.201  Court powers over trusts.

737.202  Trust proceedings; venue.

737.203  Trust proceedings; dismissal of matters relating to foreign trusts.

737.2035  Costs and attorney's fees in trust proceedings.

737.204  Proceedings for review of employment of agents and review of compensation of trustee and employees of trust.

737.2041  Trustee's attorney's fees.

737.205  Trust proceedings; commencement.

737.206  Effect of fraud, duress, mistake, and undue influence.

737.207  Penalty clause for contest.

737.201  Court powers over trusts.--

(1)  The proceedings that may be maintained under this section are those concerning the administration and distribution of trusts, the declaration of rights, and the determination of any other matters involving trustees and beneficiaries of trusts. These include, but are not limited to, proceedings to:

(a)  Appoint or remove a trustee.

(b)  Review trustees' fees and to review and settle interim or final accounts.

(c)  Ascertain beneficiaries; determine any question arising in the administration or distribution of any trust, including questions of construction of trust instruments; instruct trustees; and determine the existence or nonexistence of any immunity, power, privilege, duty, or right.

(2)  A proceeding under this section does not result in continuing supervisory proceedings. The management and distribution of a trust estate, submission of accounts and reports to beneficiaries, payment of trustee's fees and other obligations of a trust, acceptance and change of trusteeship, and other aspects of the administration of a trust shall proceed expeditiously, consistent with the terms of the trust, free of judicial intervention and without order, approval, or other action of any court, subject to the jurisdiction of the court invoked by interested parties or otherwise exercised as provided by law.

History.--s. 1, ch. 74-106; s. 2, ch. 75-221; s. 3, ch. 77-344.

737.202  Trust proceedings; venue.--Venue for actions and proceedings concerning trusts, including those under s. 737.201, may be laid in:

(1)  Any county where the venue is proper under chapter 47.

(2)  Any county where the beneficiary suing or being sued resides or has its principal place of business.

(3)  The county where the trust has its principal place of administration.

History.--s. 1, ch. 74-106; s. 4, ch. 77-344.

737.203  Trust proceedings; dismissal of matters relating to foreign trusts.--Over the objection of a party, the court shall not entertain proceedings under s. 737.201 for a trust registered, or having its principal place of administration, in another state unless all interested parties could not be bound by litigation in the courts of the state where the trust is registered or has its principal place of administration. The court may condition a stay or dismissal of a proceeding under this section on the consent of any party to jurisdiction of the state where the trust is registered or has its principal place of business, or the court may grant a continuance or enter any other appropriate order.

History.--s. 1, ch. 74-106.

737.2035  Costs and attorney's fees in trust proceedings.--

(1)  In all trust proceedings, costs may be awarded as in chancery actions.

(2)  Any attorney who has rendered services to a trust may apply to the court for an order awarding attorney's fees, and, after notice and service upon the trustee and all beneficiaries entitled to an accounting under s. 737.303, the court shall enter its order on the fee application.

(3)  When costs and attorney's fees are to be paid out of the trust, the court may, in its discretion, direct from what part of the trust they shall be paid.

(4)  The provisions of this section shall apply only to services of an attorney rendered on or after July 1, 1999.

(5)  Except when a trustee's interest may be adverse in a particular matter, the attorney shall give reasonable notice in writing to the trustee of the attorney's retention by an interested person and the attorney's entitlement to fees pursuant to this section. A court may reduce any fee award for services rendered by the attorney prior to the date of actual notice to the trustee, if the actual notice date is later than a date of reasonable notice. In exercising this discretion, the court may exclude compensation for services rendered after the reasonable notice date but prior to the date of actual notice.

History.--s. 1, ch. 99-352.

737.204  Proceedings for review of employment of agents and review of compensation of trustee and employees of trust.--

(1)  After notice to all interested persons, the court may review the propriety of employment by a trustee of any person, including any attorney, auditor, investment adviser, or other specialized agent or assistant, and the reasonableness of the compensation of any person so employed and of the compensation determined by the trustee for his or her own services. A person who has received excessive compensation from a trust may be ordered to make a refund of the excess.

(2)  If the settlor's estate is being probated, the trustee, the attorney, or any interested person may have the propriety of employment and the reasonableness of the compensation of the trustee or any person employed by the trustee determined in the probate proceeding.

(3)  In any proceeding under this section the petitioner shall either:

(a)  Serve notice on all interested persons in the manner provided for service of formal notice under s. 731.301, together with a notice advising the interested person that an answer to the petition must be filed and served on petitioner within 20 days from the service of the petition or the petition may be considered ex parte, and such notice shall be sufficient for the court to acquire jurisdiction for this proceeding over the person receiving formal notice to the extent of the person's interest in the trust; or

(b)  Obtain jurisdiction over interested persons in any other manner permitted by law.

(4)  Persons given notice as provided in this section shall be bound by all orders entered on the petition.

History.--s. 1, ch. 74-106; s. 4, ch. 75-221; s. 3, ch. 95-401; s. 1038, ch. 97-102.

737.2041  Trustee's attorney's fees.--

(1)  If the trustee of a trust described in s. 733.707(3) retains an attorney to render legal services in connection with the initial administration of the trust, the attorney is entitled to reasonable compensation for those legal services, payable from the assets of the trust without court order. If the trustee of a trust described in s. 733.707(3) retains an attorney to render legal services in connection with the initial administration of a trust, the trustee and the attorney may agree to compensation that is determined in a manner or amount other than the manner or amount provided in this section. The agreement is not binding upon a person who bears the impact of the compensation unless that person is a party to or otherwise consents to be bound by the agreement. The agreement may provide that the trustee is not individually liable for the attorney's fees and costs.

(2)  Unless otherwise agreed, compensation based upon the value of the trust assets immediately following the settlor's death and the income earned by the trust during initial administration at the rate of 75 percent of the schedule provided in s. 733.6171(3)(a)-(h) is presumed to be reasonable total compensation for ordinary services of all attorneys employed generally to advise trustees concerning their duties in initial trust administration.

(3)  An attorney who is retained to render only limited and specifically defined legal services shall be compensated as provided in the retaining agreement. If the amount or method of determining compensation is not provided in the agreement, the attorney is entitled to a reasonable fee, taking into account the factors set forth in subsection (6).

(4)  Ordinary services of the attorney in an initial trust administration include legal advice and representation concerning the trustee's duties relating to:

(a)  Review of the trust instrument and each amendment for legal sufficiency and interpretation.

(b)  Implementation of substitution of the successor trustee.

(c)  Persons who must or should be served with required notices and the method and timing of such service.

(d)  The obligation of a successor to require a former trustee to account.

(e)  The trustee's duty to protect, insure, and manage trust assets and the trustee's liability relating to these duties.

(f)  The trustee's duty regarding investments imposed by the prudent investor rule.

(g)  Contributions due to the personal representative of settlor's estate for payment of administrative expenses or creditor claims and estate taxes.

(h)  The trustee's obligation to inform and account to beneficiaries and the method of satisfaction of these obligations; the liability of the trust and trustee to the settlor's creditors; the advisability or necessity for probate proceedings to bar creditors; and the contribution requirements to the settlor's probate estate.

(i)  Identifying tax returns required to be filed by the trustee, the trustee's liability for payment of taxes, and the due date of returns.

(j)  Obtaining nontaxable certificate and receipt, if not done by a personal representative.

(k)  Order of payment of expenses of administration of the trust and order and priority of abatement of bequests and legacies in the trust.

(l)  Distribution of income or principal to beneficiaries or funding of further trusts provided in the governing instrument.

(m)  Preparation of any legal documents required to effect distribution.

(n)  Fiduciary duties, avoidance of self-dealing, conflicts of interest, duty of impartiality, and obligations to beneficiaries.

(o)  If there is a conflict of interest between a trustee who is a beneficiary and other beneficiaries of the trust, advice to the trustee on limitations of certain authority of the trustee regarding discretionary distributions or exercise of certain powers and alternatives for appointment of an independent trustee and appropriate procedures.

(p)  Procedures for trustee's discharge from liability for administration of trust upon termination or resignation.

(5)  In addition to the attorney's fees for ordinary services, the attorney for the trustee shall be allowed further reasonable compensation for any extraordinary service. What is an extraordinary service may vary depending on many factors, including the size of the trust. Extraordinary services may include, but are not limited to:

(a)  Involvement in a trust contest, trust construction, a proceeding for determination of beneficiaries, a contested claim, elective share proceedings, apportionment of estate taxes, or other adversary proceedings or litigation by or against the trust.

(b)  Representation of the trustee in audit or any proceeding for adjustment, determination, or collection of any taxes.

(c)  Tax advice on postmortem tax planning, including, but not limited to, disclaimer, renunciation of fiduciary commission, alternate valuation date, allocation of administrative expenses between tax returns, the QTIP or reverse QTIP election, allocation of GST exemption, qualification for Internal Revenue Code ss. 303 and 6166 privileges, deduction of last illness expenses, distribution planning, asset basis considerations, throwback rules, handling income or deductions in respect of a decedent, valuation discounts, special use and other valuation, handling employee benefit or retirement proceeds, prompt assessment request, or request for release of personal liability for payment of tax.

(d)  Review of estate tax return and preparation or review of other tax returns required to be filed by the trustee.

(e)  Preparation of decedent's federal estate tax return. If this return is prepared by the attorney, a fee of one-half of 1 percent up to a value of $10 million and one-fourth of 1 percent on the value in excess of $10 million, of the gross estate as finally determined for federal estate tax purposes, is presumed to be reasonable compensation for the attorney for this service. These fees shall include services for routine audit of the return, not beyond the examining agent level, if required.

(f)  Purchase, sale, lease, or encumbrance of real property by the trustee or involvement in zoning, land use, environmental, or other similar matters.

(g)  Legal advice regarding carrying on of decedent's business or conducting other commercial activity by the trustee.

(h)  Legal advice regarding claims for damage to the environment or related procedures.

(i)  Legal advice regarding homestead status of trust real property or proceedings involving the status.

(j)  Involvement in fiduciary, employee, or attorney compensation disputes.

(k)  Considerations of special valuation of trust assets, including discounts for blockage, minority interests, lack of marketability, and environmental liability.

(6)  Upon petition of any interested person in a proceeding to review the compensation paid or to be paid to the attorney for the trustee, the court may increase or decrease the compensation for ordinary services of the attorney for the trustee or award compensation for extraordinary services if the facts and circumstances of the particular administration warrant. In determining reasonable compensation, the court shall consider all of the following factors giving such weight to each as it may determine to be appropriate:

(a)  The promptness, efficiency, and skill with which the initial administration was handled by the attorney.

(b)  The responsibilities assumed by, and potential liabilities of, the attorney.

(c)  The nature and value of the assets that are affected by the decedent's death.

(d)  The benefits or detriments resulting to the trust or its beneficiaries from the attorney's services.

(e)  The complexity or simplicity of the administration and the novelty of issues presented.

(f)  The attorney's participation in tax planning for the estate, the trust, and the trust's beneficiaries and tax return preparation or review and approval.

(g)  The nature of the trust assets, the expenses of administration, and the claims payable by the trust and the compensation paid to other professionals and fiduciaries.

(h)  Any delay in payment of the compensation after the services were furnished.

(i)  Any other relevant factors.

(7)  The court may determine reasonable attorney's compensation without receiving expert testimony. Any party may offer expert testimony after notice to interested persons. If expert testimony is offered, an expert witness fee may be awarded by the court and paid from the assets of the trust. The court may, in its discretion, direct from what part of the trust it shall be paid.

(8)  If a separate written agreement regarding compensation exists between the attorney and the settlor, the attorney shall furnish a copy to the trustee prior to commencement of employment and, if employed, shall promptly file and serve a copy on all interested persons. Neither a separate agreement nor a provision in the trust suggesting or directing the trustee to retain a specific attorney will obligate the trustee to employ the attorney or obligate the attorney to accept the representation, but if the attorney who is a party to the agreement or who drafted the trust is employed, the compensation paid shall not exceed the compensation provided in the agreement.

(9)  Court proceedings to determine compensation, if required, are a part of the trust administration process, and the costs, including fees for the trustee's attorney, shall be determined by the court and paid from the assets of the trust unless the court finds the attorney's fees request to be substantially unreasonable. The court shall direct from which part of the trust they shall be paid.

(10)  "Initial trust administration" as used in this section means administration of a trust described in s. 733.707(3) during the period which begins with the death of the settlor and ends upon the final distribution of trust assets outright or to continuing trusts created under the trust agreement, but if an estate tax return is required, not until after issuance of an estate tax closing letter or other evidence of termination of the estate tax proceeding. This initial period is not intended to include continued regular administration of the trust.

(11)  This section shall apply to trusts of settlors who die on or after July 1, 1995.

History.--s. 4, ch. 95-401; s. 5, ch. 97-240.

737.205  Trust proceedings; commencement.--Proceedings concerning trusts shall be commenced by filing a complaint and shall be governed by the Florida Rules of Civil Procedure.

History.--s. 1, ch. 74-106; s. 4, ch. 75-221.

737.206  Effect of fraud, duress, mistake, and undue influence.--A trust is void if the execution is procured by fraud, duress, mistake, or undue influence. Any part of the trust is void if so procured, but the remainder of the trust not so procured is valid if it is not invalid for other reasons. An action to contest the validity of all or part of a trust may not be commenced until the trust becomes irrevocable.

History.--s. 21, ch. 92-200.

737.207  Penalty clause for contest.--A provision in a trust instrument purporting to penalize any interested person for contesting the trust instrument or instituting other proceedings relating to a trust estate or trust assets is unenforceable.

History.--s. 12, ch. 93-257.

737.301  General duties not limited.

737.302  Trustee's standard of care and performance.

737.303  Duty to inform and account to beneficiaries.

737.304  Duty to provide bond.

737.305  Trustee's duty concerning location of trust.

737.3053  Trustee's duty to distribute trust income.

737.3054  Trustee's duty to pay expenses and obligations of settlor's estate.

737.3055  Trustee's duty to ascertain marketable title of trust real property.

737.306  Personal liability of trustee.

737.307  Limitations on proceedings against trustees after beneficiary receives account.

737.308  Notice of trust.

737.301  General duties not limited.--Except as specifically provided, the general duty of the trustee to administer a trust diligently for the benefit of the beneficiaries is not altered by this part.

History.--s. 1, ch. 74-106.

737.302  Trustee's standard of care and performance.--Except as otherwise provided by the trust instrument, the trustee shall observe the standards in s. 518.11 regarding investments by fiduciaries when dealing with the trust assets. If the trustee has special skills, or is named trustee on the basis of representations of special skills or expertise, the trustee is under a duty to use those skills.

History.--s. 1, ch. 74-106; s. 6, ch. 75-221; s. 13, ch. 93-257.

737.303  Duty to inform and account to beneficiaries.--The trustee shall keep the beneficiaries of the trust reasonably informed of the trust and its administration. The trustee's duty to inform and account includes, but is not limited to, the following:

(1)  Within 30 days after acceptance of the trust, the trustee shall inform the beneficiaries in writing of the acceptance of the trust and the full name and address of the trustee.

(2)  Upon reasonable request, the trustee shall provide a beneficiary with a complete copy of the trust instrument, including amendments.

(3)  Upon reasonable request, the trustee shall provide a beneficiary with relevant information about the assets of the trust and the particulars relating to administration.

(4)(a)  A beneficiary is entitled to a statement of the accounts of the trust annually and upon termination of the trust or upon change of the trustee except as provided under paragraph (c).

(b)  For purposes of this section, the term "beneficiary" means:

1.  All current income or principal beneficiaries, whether discretionary or mandatory; and

2.  All reasonably ascertainable remainder beneficiaries who would take if all income interests immediately terminated.

(c)  In the case of a trust described in s. 733.707(3), the trustee's duties under paragraph (a) extend only to the grantor or the legal representative of the grantor during the grantor's lifetime.

(d)  A beneficiary or the beneficiary's representative, as defined in s. 731.303, may waive, in writing, the trustee's duty to account under paragraph (a).

(e)  All rights provided a beneficiary under this section may be asserted by a legal representative or natural guardian of the beneficiary. Notice under subsection (1) and a statement of accounts under paragraph (a) provided to a representative of the beneficiary as defined in s. 731.303 shall bind the beneficiary, and the trustee shall not be required to provide such notice or statement of accounts to any beneficiary who would be bound by an order binding on a representative of the beneficiary under s. 731.303, if such notice or statement of accounts, respectively, is provided to that representative.

History.--s. 1, ch. 74-106; s. 6, ch. 75-221; s. 5, ch. 77-344; s. 12, ch. 95-401; s. 6, ch. 97-240.

737.304  Duty to provide bond.--A trustee need not provide bond to secure performance of his or her duties unless this is required by the trust instrument, reasonably requested by a beneficiary, or found by the court to be necessary to protect the interests of beneficiaries who are not able to protect themselves and whose interests otherwise are not adequately represented. On application of the trustee or other interested person, the court may excuse a requirement of bond, increase or reduce the amount of the bond, release the surety, or permit the substitution of another bond with the same or different sureties. If bond is required, it shall be filed in the clerk's office in the county where the trust has its principal place of business, in amounts and with surety as provided in s. 45.011 and conditioned on the faithful performance of the trust.

History.--s. 1, ch. 74-106; s. 6, ch. 75-221; s. 6, ch. 77-344; s. 1039, ch. 97-102.

737.305  Trustee's duty concerning location of trust.--A trustee is under a continuing duty to administer the trust at a place appropriate to the purposes of the trust and its sound, efficient management. If the principal place of administration becomes inappropriate for any reason, the court may enter an order for the purposes of furthering efficient administration and the interests of beneficiaries, including, if appropriate, removal of the trustee and appointment of a trustee in another state. Trust provisions relating to the place of administration and to changes in the place of administration or of trustee shall control, unless compliance would be contrary to efficient administration or the purposes of the trust. Views of adult beneficiaries shall be given weight in determining the suitability of the trustee and the place of administration.

History.--s. 1, ch. 74-106; s. 7, ch. 75-221; s. 7, ch. 77-344.

737.3053  Trustee's duty to distribute trust income.--If a will or trust instrument granting income to the grantor's or testator's spouse for life is silent as to the time of distribution of income and the frequency thereof, the trustee shall distribute all net income to the income beneficiary, as defined in chapter 738, no less frequently than annually. This provision shall apply to any trust established before, on, or after the effective date hereof unless the trust instrument expressly directs or permits net income to be distributed less frequently than annually.

History.--s. 3, ch. 79-343; s. 1, ch. 86-248.

737.3054  Trustee's duty to pay expenses and obligations of settlor's estate.--

(1)  A trustee of a trust described in s. 733.707(3) shall pay to the personal representative of a settlor's estate any amounts that the personal representative certifies in writing to the trustee are required to pay the expenses of the administration of the settlor's estate and the enforceable claims of the settlor's creditors. Payments made by a trustee, unless otherwise provided in the trust instrument, must be charged as expenses of the trust without a contribution from anyone. The interest of all beneficiaries of such a trust are subject to the provisions of this subsection; however, the payments must be made from assets or property or the proceeds thereof, other than assets proscribed in s. 733.707(3), which are included in the settlor's gross estate for federal estate tax purposes.

(2)  Unless a settlor provides by will, or designates the funds or property passing under a trust described in s. 733.707(3) to be so used, the expenses of the administration of the settlor's estate and enforceable claims of the settlor's creditors must be paid from the trust in the following order:

(a)  Property of the residue of the trust remaining after all distributions that are to be satisfied by reference to a specific property or type of property, fund, or sum;

(b)  Property that is not to be distributed from specified or identified property or a specified or identified item of property; and

(c)  Property that is to be distributed from specified or identified property or a specified or identified item of property.

(3)  Trust distributions that are to be satisfied from specified or identified property must be classed as distributions to be satisfied from the general assets of the trust and not otherwise disposed of in the trust instrument upon the failure or insufficiency of funds or property from which payment should be made, to the extent of the insufficiency. Trust distributions given for valuable consideration abate with other distributions of the same class only to the extent of the excess over the value of the consideration until all others of the same class are exhausted. Except as provided in this section, trust distributions abate equally and ratably and without preference or priority between real and personal property. When a specified or identified item of property that has been designated for distribution in the trust instrument or that is charged with a distribution is sold or taken by the trustee, other beneficiaries shall contribute according to their respective interests to the beneficiary whose property has been sold or taken, and before distribution the trustee shall determine the amounts of the respective contributions, and they must be paid or withheld before distribution is made.

(4)  The trustee shall pay the expenses of trust administration, including compensation of trustees and their attorneys, before and in preference to the expenses of the administration of the settlor's estate and enforceable claims of the settlor's creditors.

History.--s. 13, ch. 95-401.

737.3055  Trustee's duty to ascertain marketable title of trust real property.--A trustee holding title to real property received from a settlor or estate shall not be required to obtain title insurance or proof of marketable title until a marketable title is required for a sale or conveyance of the real property.

History.--s. 4, ch. 79-343.

737.306  Personal liability of trustee.--

(1)(a)  Unless otherwise provided in the contract, a trustee is not personally liable on contracts, except contracts for attorneys' fees, properly entered into in the trustee's fiduciary capacity in the course of administration of the trust estate unless he or she fails to reveal his or her representative capacity and identify the trust estate in the contract.

(b)  A trustee is personally liable for obligations arising from ownership or control of property of the trust estate or for torts committed in the course of administration of the trust estate only if the trustee is personally at fault.

(c)  Claims based on contracts, except contracts for attorneys' fees, entered into by a trustee in his or her fiduciary capacity, on obligations arising from ownership or control of the trust estate, or on torts committed in the course of trust administration may be asserted against the trust estate by proceeding against the trustee in his or her fiduciary capacity, whether or not the trustee is personally liable.

(2)  Issues of liability between the trust estate and the trustee individually may be determined in a proceeding for accounting, surcharge, or indemnification, or in any other appropriate proceeding.

(3)  A successor trustee is not personally liable for any action taken or omitted to be taken by any prior trustee; nor does any successor trustee have a duty to institute any action against any prior trustee, or file any claim against any prior trustee's estate, for any of the prior trustee's acts or omissions as trustee under any of the following circumstances:

(a)  The successor trustee succeeds a trustee who was also the grantor of a trust that was revocable during the time that the grantor served as trustee;

(b)  As to any beneficiary who has waived any accounting required by s. 737.303, but only as to the periods included in such waiver;

(c)  As to any beneficiary who has released the successor trustee from such duty to institute any action or file any claim;

(d)  As to any person who is not a beneficiary within the meaning of s. 737.303(4)(b); or

(e)  As to any beneficiary described in s. 737.303(4)(b):

1.  If a super majority of the reasonably ascertainable current income or principal beneficiaries described in s. 737.303(4)(b)1. and a super majority of the reasonably ascertainable remainder beneficiaries described in s. 737.303(4)(b)2. have released the successor trustee;

2.  If the beneficiary has not delivered a written request to the successor trustee to institute an action or file a claim against the prior trustee within 6 months after the date of the successor trustee's acceptance of the trust, if the successor trustee has notified the beneficiary in writing of its acceptance in accordance with s. 737.303(1) and such writing advises the beneficiary that, unless the beneficiary delivers such written request within 6 months after the date of acceptance, his or her right to proceed against the successor trustee will be barred pursuant to this section; or

3.  For any action or claim that the beneficiary is barred from bringing against the prior trustee.

(4)(a)  Two years after the death of a settlor, neither a trust described in s. 733.707(3) as established by the settlor, the trustee of the trust, nor any beneficiary may be held liable for any claim or cause of action against the settlor by a creditor who seeks to recover from the trust, trustee, or beneficiary.

(b)  This subsection does not apply to a creditor who has timely filed a claim against the settlor's estate under s. 733.702 within 2 years after the settlor's death and whose claim has not been paid or otherwise disposed of, even if the settlor's estate proceedings have been closed or otherwise completed.

(c)  This subsection does not affect the lien of a duly recorded mortgage or security interest or the right to foreclose and enforce the mortgage or lien.

(5)  For the purposes of this section, a super majority of beneficiaries means at least two-thirds in interest of the beneficiaries if the interests of the beneficiaries are reasonably ascertainable; otherwise, it means at least two-thirds in number of the beneficiaries. A release or waiver under this section may be exercised by a legal representative or natural guardian of the beneficiary without the filing of any proceeding or approval of any court. Nothing in subsection (3) affects any liability of the prior trustee or the right of the successor trustee or any beneficiary to pursue an action or claim against the prior trustee.

History.--s. 1, ch. 74-106; s. 7, ch. 75-221; s. 8, ch. 77-344; s. 2, ch. 86-248; s. 8, ch. 95-401; s. 1040, ch. 97-102; s. 2, ch. 99-352.

737.307  Limitations on proceedings against trustees after beneficiary receives account.--Unless previously barred by adjudication, consent, or limitations, an action against a trustee for breach of trust is barred for any beneficiary who has received a final, annual, or periodic account or other statement fully disclosing the matter unless a proceeding to assert the claim is commenced within 6 months after receipt of the final, annual, or periodic account or statement. In any event, and notwithstanding lack of full disclosure, all claims against a trustee who has issued a final account or statement received by the beneficiary and has informed the beneficiary of the location and availability of records for his or her examination are barred as provided in chapter 95. A beneficiary has received a final, annual, or periodic account or statement if, being an adult, it is received by the beneficiary or if, being a minor, disabled person, or person who may take by virtue of the exercise or nonexercise of a power of appointment, it is received by the beneficiary's representative as described in s. 731.303.

History.--s. 1, ch. 74-106; s. 7, ch. 75-221; s. 2, ch. 88-217; s. 1041, ch. 97-102.

737.308  Notice of trust.--

(1)  Upon the death of a settlor of a trust described in s. 733.707(3), the trustee must file a notice of trust with the court of the county of the settlor's domicile and the court having jurisdiction of the settlor's estate.

(2)  The notice of trust must contain the name of the settlor, the settlor's date of death, the title of the trust, if any, the date of the trust, and the name and address of the trustee.

(3)  If the settlor's probate proceeding has been commenced, the clerk must notify the trustee in writing of the date of the commencement of the probate proceeding and the file number.

(4)  The clerk shall file and index the notice of trust in the same manner as a caveat, unless there exists a probate proceeding for the settlor's estate in which case the notice of trust must be filed in the probate proceeding and the clerk shall send a copy to the personal representative.

(5)  The clerk shall send a copy of any caveat filed regarding the settlor to the trustee, and the Notice of Trust to any caveator, unless there is a probate proceeding pending and the personal representative and the trustee are the same.

(6)  In any proceeding affecting the expenses of the administration of the estate, or any claims described in s. 733.702(1), the trustee of a trust described in s. 733.707(3) is an interested person in the administration of the grantor's estate.

(7)  Any proceeding affecting the expenses of the administration of the estate or any claims described in s. 733.702(1) prior to the trustee filing a notice of trust are binding upon the trustee.

(8)  The trustee's failure to file the notice of trust does not affect the trustee's obligation to pay expenses of administration and enforceable claims as provided in s. 733.607(2).

History.--s. 14, ch. 95-401; s. 7, ch. 97-240.

737.401  Powers of trustee conferred by trust or by law.

737.402  Powers of trustees conferred by this part.

737.4025  Powers of trustees conferred by this part in relation to environmental or human health laws affecting trust property or to trust property contaminated with hazardous or toxic substances; liability.

737.403  Power of court to permit deviation or to approve transactions involving conflict of interest.

737.404  Powers exercisable by joint trustees; liability.

737.405  Third persons protected.

737.406  Application of this part.

737.401  Powers of trustee conferred by trust or by law.--The trustee has all powers conferred upon him or her by this part, unless limited in the trust instrument.

History.--s. 1, ch. 74-106; s. 8, ch. 75-221; s. 9, ch. 77-344; s. 1042, ch. 97-102.

737.402  Powers of trustees conferred by this part.--

(1)  From the creation of the trust until final distribution of the assets from the trust, a trustee has the power to perform every act that a prudent trustee would perform for the purposes of the trust, without court authorization, including, but not limited to, the powers specified in subsections (2) and (3) but subject to the limitations of subsection (4).

(2)  Unless otherwise provided in the trust instrument, a trustee has the power:

(a)  To collect, hold, and retain trust assets received from a settlor until disposition of the assets should be made. The assets may be retained even though they include an asset in which the trustee is personally interested.

(b)  To hold without liability, other than that involved in holding property legal for investment of trust funds, any and all property received from or through the settlor of the trust, whether or not permissible for investment of funds of that particular trust, and any property lawfully coming into the hands of the trustees instead of or in substitution therefor, including the power to exchange capital stock of any bank or trust company, including capital stock of the corporate trustee, for capital stock in any registered bank holding company if the bank holding company is subject to the provisions of 12 U.S.C. ss. 1841 et seq., as amended, commonly known as the Bank Holding Company Act of 1956. This provision does not cover reinvestments of cash made by the trustee except for the purchase of fractional shares and the exercise of rights acquired in the exchange.

(c)  To receive additions to the assets of the trust and, unless expressly provided to the contrary in the trust instrument, to incorporate those additions as part of the trust or hold the additions as a separate trust having terms identical to the terms of the existing trust.

(d)  To continue or participate in the operation of any business or other enterprise and to effect incorporation, dissolution, or other change in the form of the organization of the business or enterprise.

(e)  To acquire an undivided interest in a trust asset, including, but not limited to, a money market mutual fund, mutual fund, or common trust fund, in which asset the trustee holds an undivided interest in any trust capacity, including any money market or other mutual fund from which the trustee, any cotrustee, or any affiliate or associate of the trustee or cotrustee is entitled to receive reasonable compensation for providing necessary services as an investment adviser, portfolio manager, or servicing agent. A trustee, cotrustee, or affiliate or associate of the trustee or cotrustee may receive compensation for such services in addition to fees received for administering the trust, provided such compensation is fully disclosed in writing to all current income beneficiaries of the trust.

(f)  To invest and reinvest trust assets in accordance with the provisions of the trust or as provided by law.

(g)  If a bank, to deposit trust funds in another department of the same entity or in a bank that is affiliated with the trustee bank.

(h)  To acquire or dispose of an asset for cash or on credit at a public or private sale; to manage, develop, improve, exchange, partition, change the character of, or abandon a trust asset or any interest in it; and to encumber, mortgage, or pledge a trust asset for a term within or extending beyond the term of the trust in connection with the exercise of any power vested in the trustee.

(i)  To make ordinary or extraordinary repairs or alterations in buildings or other structures; to demolish any improvements; or to raze existing, or erect new, party walls or buildings.

(j)  To subdivide, develop, or dedicate land to public use; to make, or obtain the vacation of, plats and adjust boundaries; to adjust differences in valuation on exchange or partition by giving or receiving consideration; or to dedicate easements to public use without consideration.

(k)  To enter for any purpose into a lease as lessor or lessee with or without option to purchase or renew for a term within or extending beyond the term of the trust.

(l)  To enter into a lease or arrangement for exploration and removal of minerals or other natural resources or enter into a pooling or unitization agreement.

(m)  To grant an option involving disposition of a trust asset or to take an option for the acquisition of any asset.

(n)  To vote a security, in person or by general or limited proxy, or not to vote a security.

(o)  To pay calls, assessments, and any other sums chargeable or accruing against, or on account of, securities.

(p)  To sell or exercise stock subscription or conversion rights and consent, directly or through a committee or other agent, to the reorganization, consolidation, merger, dissolution, or liquidation of a corporation or other business enterprise.

(q)  To hold property in the name of a nominee or in other form without disclosure of the trust so that title to the property may pass by delivery, but the trustee is liable for any act of the nominee in connection with the property so held.

(r)  To insure the assets of the trust against damage or loss and insure the trustee against liability with respect to third persons.

(s)  To borrow money to be repaid from trust assets or otherwise, and to advance money for the protection of the trust and for all expenses, losses, and liabilities sustained in the administration of the trust or because of the holding or ownership of any trust assets, for which advances, with any interest, the trustee has a lien on the trust assets as against the beneficiary.

(t)  To pay or contest any claim; to settle a claim by or against the trust by compromise, arbitration, or otherwise; and to release any claim belonging to the trust in whole or in part to the extent that the claim is uncollectible.

(u)  To pay taxes, assessments, compensation of the trustee, and other expenses incurred in the collection, care, administration, and protection of the trust.

(v)  To allocate items of income or expense to either trust income or principal, as provided by law.

(w)  To pay any sum distributable to a beneficiary under legal disability to the beneficiary or by paying the sum for the use of the beneficiary either to a legal representative appointed by the court or, if none, to a relative; and, when income is directed to be paid to minors, apply and expend it for their benefit either with or without the intervention of a guardian.

(x)  To effect distribution of property and money in divided or undivided interests and to adjust resulting differences in valuation.

(y)  To employ persons, including attorneys, auditors, investment advisers, or agents, even if they are the trustee or associated with the trustee, to advise or assist the trustee in the performance of his or her administrative duties; to act without independent investigation upon their recommendations; and, instead of acting personally, to employ one or more agents to perform any act of administration, whether or not discretionary.

(z)  To prosecute or defend actions, claims, or proceedings for the protection of trust assets and of the trustee in the performance of his or her duties.

(aa)  To execute and deliver all instruments that will accomplish or facilitate the exercise of the powers vested in the trustee.

(bb)  To sever any trust on a fractional basis into two or more separate and identical trusts for any reason or to segregate by allocation to a separate account or trust a specific amount from, a portion of, or specific assets included in, the trust property of any trust, unless expressly provided to the contrary in the trust instrument. Income earned on a segregated amount, portion, or specific asset after the segregation is effective passes with the amount, portion, or asset segregated. Each separate trust must be held and administered upon the identical terms and conditions of the trust from which it was severed. Subject to the terms of the trust, the trustee may take into consideration differences in federal tax attributes and other pertinent factors in administering the trust property of any separate account or trust, in making applicable tax elections, and in making distributions. A separate trust created by severance must be treated as a separate trust for all purposes from the date on which the severance is effective. The effective date of the severance may be retroactive to a date before the date on which the trustee exercises such power.

(3)  If a trustee has determined that the market value of a trust is less than $50,000 and that, relative to the costs of administering the trust, continuance pursuant to its existing terms will defeat or substantially impair the accomplishment of its purposes, the trustee may, in the trustee's sole discretion, terminate the trust and distribute the trust property, including principal and undistributed income, to the beneficiaries in a manner which conforms as nearly as possible to the intention of the settlor. The trustee may enter into agreements or make such other provisions that it deems necessary or appropriate to protect the interests of the beneficiaries and the trustee and to carry out the intent and purpose of the trust. The existence of a spendthrift or similar protective provision in the trust does not make this subsection inapplicable unless the trust instrument expressly provides that the trustee may not terminate the trust pursuant to this subsection.

(4)(a)  Due to the inherent conflict of interest that exists between a trustee who is a beneficiary and other beneficiaries of the trust, unless the terms of a trust refer specifically to this subsection and provide expressly to the contrary, any power conferred upon a trustee (other than the settlor of a revocable or amendable trust or a decedent's or settlor's spouse who is the trustee of a testamentary or an inter vivos trust for which a marital deduction has been allowed):

1.  To make discretionary distributions of either principal or income to or for the benefit of such trustee, except to provide for that trustee's health, education, maintenance, or support as described under Internal Revenue Code ss. 2041 and 2514;

2.  To make discretionary allocations of receipts or expenses as between principal and income, unless such trustee acts in a fiduciary capacity whereby such trustee has no power to enlarge or shift any beneficial interest except as an incidental consequence of the discharge of such trustee's fiduciary duties;

3.  To make discretionary distributions of either principal or income to satisfy any legal support obligations of such trustee; or

4.  To exercise any other power, including the right to remove or to replace any trustee, so as to cause the powers enumerated in subparagraph 1., subparagraph 2., or subparagraph 3. to be exercised on behalf of, or for the benefit of, a beneficiary who is also a trustee,

cannot be exercised by such trustee. Any of the foregoing proscribed powers that are conferred upon two or more trustees may be exercised by the trustees who are not so disqualified. If there is no trustee qualified to exercise such power, any party in interest, as defined in paragraph (c), may apply to a court of competent jurisdiction to appoint an independent trustee and such power may be exercised by the independent trustee appointed by the court.

(b)  This subsection applies to:

1.  Any trust executed after June 30, 1991, unless the terms of the trust refer specifically to this subsection and provide expressly to the contrary;

2.  Any testamentary trust created under a will executed after June 30, 1991, unless the terms of the trust refer specifically to this subsection and provide expressly to the contrary; and

3.  Any trust created under a document executed before July 1, 1991, unless:

a.  If the trust is revocable or amendable, the settlor revokes or amends the trust at any time to provide otherwise; or

b.  If the trust is irrevocable, all parties in interest, as defined in paragraph (c), elect affirmatively, in the manner prescribed in paragraph (d), not to be subject to the application of this subsection. Such election must be made on or before the later of July 1, 1994, or 3 years after the date on which the trust becomes irrevocable.

However, the provisions of this subsection neither create a new cause of action nor impair any existing cause of action which, in either case, relates to any power proscribed by paragraph (a) that was exercised before July 1, 1991.

(c)  For the purpose of paragraph (a) or paragraph (b):

1.  If the trust is revocable or amendable and the settlor is not incapacitated, the party in interest is the settlor.

2.  If the trust is revocable or amendable and the settlor is incapacitated, the party in interest is the settlor's legal representative under applicable law or the settlor's donee under a durable power of attorney that is sufficient to grant such authority.

3.  If the trust is not revocable or amendable, the parties in interest are:

a.  Each trustee then serving;

b.  Each income beneficiary then in existence or, if any such beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's legal representative under applicable law or the beneficiary's donee under a durable power of attorney that is sufficient to grant such authority; and

c.  Each remainder beneficiary then in existence or, if any such remainder beneficiary has not attained majority or is otherwise incapacitated, the beneficiary's legal representative under applicable law or the beneficiary's donee under a durable power of attorney that is sufficient to grant such authority.

(d)  The affirmative election required under paragraph (b) must be made:

1.  If the settlor is not incapacitated and the trust is revocable or amendable, through a revocation of or an amendment to the trust;

2.  If the settlor is incapacitated and the trust is revocable or amendable, through a written declaration executed in the manner prescribed for the recordation of deeds in this state and delivered to the trustee; or

3.  If the trust is not revocable or amendable, through a written declaration executed in the manner prescribed for the recordation of deeds in this state and delivered to the trustee.

(e)  A person who has the right to remove or to replace a trustee does not possess nor may that person be deemed to possess, by virtue of having that right, the powers of the trustee that is subject to removal or to replacement.

History.--s. 1, ch. 74-106; s. 8, ch. 75-221; s. 3, ch. 84-31; s. 1, ch. 84-179; s. 2, ch. 89-39; s. 3, ch. 91-61; s. 27, ch. 92-200; s. 15, ch. 95-401; s. 1043, ch. 97-102.

Note.--Created from former s. 691.03.

737.4025  Powers of trustees conferred by this part in relation to environmental or human health laws affecting trust property or to trust property contaminated with hazardous or toxic substances; liability.--

(1)  From the creation of a trust until final distribution of the assets from the trust, the trustee has, without court authorization, the powers specified in subsection (2).

(2)  Unless otherwise provided in the trust instrument, a trustee has the power, acting reasonably and for the benefit of the beneficiaries:

(a)  To inspect or investigate, or cause to be inspected or investigated, property held by the trustee, including interests in sole proprietorships, partnerships, or corporations and any assets owned by any such business entity for the purpose of determining compliance with an environmental law affecting that property or to respond to an actual or threatened violation of an environmental law affecting that property;

(b)  To take, on behalf of the trust, any action necessary to prevent, abate, or otherwise remedy an actual or potential violation of an environmental law affecting property held by the trustee, either before or after initiation of an enforcement action by a governmental body;

(c)  To refuse to accept property in trust if the trustee determines that any property to be donated or conveyed to the trustee either is contaminated with a hazardous substance or is being used or has been used for an activity directly or indirectly involving a hazardous substance, which circumstance could result in liability to the trust or trustee or otherwise impair the value of the assets to be held;

(d)  To settle or compromise at any time any claim against the trust or trustee that may be asserted by a governmental body or private party which involves the alleged violation of an environmental law affecting property of any trust over which the trustee has responsibility;

(e)  To disclaim any power granted by any document, statute, or rule of law which, in the sole judgment of the trustee, may cause the trustee to incur personal liability, or the trust to incur liability, under any environmental law;

(f)  To decline to serve as a trustee, or having undertaken to serve as a trustee, to resign at any time, if the trustee believes that there is or may be a conflict of interest in its fiduciary capacity and in its individual capacity because of potential claims or liabilities that may be asserted against it on behalf of the trust by reason of the type or condition of the assets held; or

(g)  To charge against the income and principal of the trust the cost of any inspection, investigation, review, abatement, response, cleanup, or remedial action that this section authorizes the trustee to take; and, in the event of the closing or termination of the trust or the transfer of the trust property to another trustee, to hold assets sufficient to cover the cost of cleaning up any known environmental problem.

(3)  A trustee is not personally liable to any beneficiary or any other party for a decrease in value of assets in a trust by reason of the trustee's compliance or efforts to comply with an environmental law, specifically including any reporting requirement under that law.

(4)  A trustee that acquires ownership or control of a vessel or other property without having owned, operated, or materially participated in the management of that vessel or property before assuming ownership or control as trustee is not considered an owner or operator for purposes of liability under chapter 376, chapter 403, or any other environmental law. A trustee that willfully, knowingly, or recklessly causes or exacerbates a release or threatened release of a hazardous substance is personally liable for the cost of the response, to the extent that the release or threatened release is attributable to the trustee's activities. This subsection does not preclude the filing of claims against the assets that constitute the trust held by the trustee or the filing of actions against the trustee in its representative capacity. In any such action, an award or judgment against the trustee must be satisfied only from the assets of the trust.

(5)  Neither the acceptance by the trustee of the property nor a failure by the trustee to inspect or investigate the property creates any inference as to whether there is liability under an environmental law with respect to that property.

(6)  For the purposes of this section, the term "environmental law" means a federal, state, or local law, rule, regulation, or ordinance that relates to protection of the environment or human health, and the term "hazardous substance" means a substance defined as hazardous or toxic, or any contaminant, pollutant, or constituent thereof, or otherwise regulated by an environmental law.

(7)  This section does not apply to any trust created under a document executed before July 1, 1995, unless the trust is amendable and the settlor amends the trust at any time to incorporate the provisions of this section.

History.--s. 19, ch. 95-401.

737.403  Power of court to permit deviation or to approve transactions involving conflict of interest.--

(1)  This part does not affect the power of the court to relieve a trustee for cause from any restrictions on the trustee's power that would otherwise be placed upon the trustee by the trust or by this part.

(a)  Unless expressly provided to the contrary in the trust instrument, the court may permit a trustee:

1.  To consolidate two or more trusts having similar terms into a single trust; or

2.  To sever any trust on a fractional basis into two or more separate trusts for any reason, and to segregate by allocation to a separate account or trust a specific amount from, a portion of, or a specific asset included in the trust property of any trust to reflect a disclaimer, to reflect or result in differences in federal tax attributes, to satisfy any federal tax requirement, to make federal tax elections, to reduce potential generation-skipping transfer tax liability, or for any other tax planning purposes or other reasons.

a.  A separate trust created by severance must be treated as a separate trust for all purposes from the effective date on which the severance is effective. The effective date of the severance may be retroactive to a date before the date on which the court approves the severance.

b.  A trustee who acts in good faith is not liable to any person for taking into consideration differences in federal tax attributes and other pertinent factors in administering the trust property of any separate account or trust, in making applicable tax elections, and making distributions pursuant to the terms of the separate trust.

(b)  A trust created by consolidation or severance under this section must be held on terms and conditions identical to those before the consolidation or severance, or upon such terms or conditions that the aggregate interests of each beneficiary after the consolidation or severance will be reasonably equivalent to that beneficiary's aggregate interests before the consolidation or severance. In determining whether a beneficiary's aggregate interests are reasonably equivalent, the court shall consider the economic value of those interests to the extent that they can be valued, considering such actuarial factors as may be appropriate. If a beneficiary's interest cannot be valued with any reasonable degree of certainty because of the nature of the trust property, the terms of the trust, or other reasons, the court shall base the determination upon such other factors as are reasonable and appropriate under the facts and circumstances applicable to that particular trust, including the purposes of the trust.

(c)  The terms of any trust before consolidation or a severance under paragraph (a) which permit qualification of that trust for an applicable federal tax deduction, exclusion, election, exemption, or other special federal tax status must remain identical in the consolidated trust or in each of the separate trusts created by severance.

(d)  Income earned on a consolidated or severed amount, portion, or specific asset after the consolidation or severance is effective passes with that amount, portion, or specific asset.

(2)  If the duty of the trustee and the trustee's individual interest or his or her interest as trustee of another trust conflict in the exercise of a trust power, the power may be exercised only by court authorization, except as provided in s. 737.402(2)(a), (e), (g), (s) and (y). Under this section, personal profit or advantage to an affiliated or subsidiary company or association is personal profit to any corporate trustee.

History.--s. 1, ch. 74-106; s. 8, ch. 75-221; s. 16, ch. 95-401; s. 1044, ch. 97-102.

737.404  Powers exercisable by joint trustees; liability.--

(1)  Any power vested in three or more trustees may be exercised by a majority, but a trustee who has not joined in exercising a power is not liable to the beneficiaries or to others for the consequences of the exercise, and a dissenting trustee is not liable for the consequences of an act in which he or she joins at the direction of the majority of the trustees if the dissenting trustee expressed his or her dissent in writing to any of his or her cotrustees at or before the time of the joinder.

(2)  If two or more trustees are appointed to perform a trust and any of them is unable or refuses to accept the appointment or, having accepted, ceases to be a trustee, the surviving or remaining trustees shall perform the trust and succeed to all the powers, duties, and discretionary authority given to the trustees jointly.

(3)  This section does not excuse a cotrustee from liability for failure either to participate in the administration of the trust or to attempt to prevent a breach of trust.

History.--s. 1, ch. 74-106; s. 1045, ch. 97-102.

Note.--Created from former s. 691.04.

737.405  Third persons protected.--With respect to a third person dealing with a trustee or assisting a trustee in the conduct of a transaction, the existence of trust powers and their proper exercise by the trustee may be assumed without inquiry. The third person is not bound to inquire whether the trustee has power to act or is properly exercising the power. A third person without actual knowledge that the trustee is exceeding his or her powers or improperly exercising them is as fully protected in dealing with the trustee as if the trustee possessed and properly exercised the powers he or she purports to exercise. A third person is not bound to assure the proper application of trust assets paid or delivered to the trustee.

History.--s. 1, ch. 74-106; s. 10, ch. 75-221; s. 10, ch. 77-344; s. 1046, ch. 97-102.

737.406  Application of this part.--Except as specifically provided in the trust, the provisions of this part apply to any trust established before or after the effective date of this part.

History.--s. 1, ch. 74-106.

737.501  Definitions.

737.502  Application of this part.

737.503  Trustee of a private foundation trust or a split interest trust.

737.504  Powers and duties of trustee of a private foundation trust or a split interest trust.

737.505  Notice that this part does not apply.

737.506  Power to amend trust instrument.

737.507  Power of court to permit deviation.

737.508  Release; property and persons affected; manner of effecting.

737.509  Election to come under this part.

737.510  Supervision by public charitable organization.

737.511  Interpretation.

737.512  Inapplicability to certain trusts.

737.501  Definitions.--As used in this part:

(1)  Unless otherwise indicated, section references relate to the Internal Revenue Code of 1954, in effect on January 1, 1971, and the references are to sections of Title 26 of the United States Code as in effect on that date.

(2)  "Charitable organization" means an organization described in s. 501(c)(3) and exempt from tax under s. 501(a).

(3)  "Private foundation trust" means a trust, including a trust described in s. 4947(a)(1), as defined in s. 509(a).

(4)  "Split interest trust" means a trust for individual and charitable beneficiaries that is subject to the provisions of s. 4947(a)(2).

(5)  "State attorney" means:

(a)  The state attorney for the judicial circuit having original jurisdiction of the trust if the trust is registered.

(b)  The state attorney for the judicial circuit where the trustee is domiciled or has his or her principal place of business if the trust is not registered.

(6)  "Trust" means an express trust created by a trust instrument, including a will.

(7)  "Trustee" means the trustee, trustees, person, or persons possessing a power or powers referred to in this part concerning a private foundation trust or a split interest trust.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221; s. 1047, ch. 97-102.

Note.--Created from former s. 691.11.

737.502  Application of this part.--Except as otherwise provided in the trust, the provisions of this part apply to all private foundation trusts and split interest trusts, whether created or established before or after November 1, 1971, and to all trust assets acquired by the trustee before or after November 1, 1971.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.12.

737.503  Trustee of a private foundation trust or a split interest trust.--Except as provided in s. 737.505, the trustee of a private foundation trust or a split interest trust has the duties and powers conferred on him or her by this part.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221; s. 1048, ch. 97-102.

Note.--Created from former s. 691.13.

737.504  Powers and duties of trustee of a private foundation trust or a split interest trust.--

(1)  In the exercise of his or her powers, including the powers granted by this part, a trustee has a duty to act with due regard to his or her obligation as a fiduciary, including a duty not to exercise any power in such a way as to:

(a)  Deprive the trust of an otherwise available tax exemption, deduction, or credit for tax purposes.

(b)  Deprive a donor of a trust asset or tax deduction or credit.

(c)  Operate to impose a tax upon a donor, trust, or other person.

"Tax" includes, but is not limited to, any federal, state, or local excise, income, gift, estate, or inheritance tax.

(2)  Except as provided in s. 737.505, a trustee of a private foundation trust shall make distributions at such time and in such manner as not to subject the trust to tax under s. 4942.

(3)  Except as provided in subsection (4) and in s. 737.505, a trustee of a private foundation trust, or a split interest trust to the extent that the split interest trust is subject to the provisions of s. 4947(a)(2), in the exercise of his or her powers shall not:

(a)  Engage in any act of self-dealing as defined in s. 4941(d).

(b)  Retain any excess business holdings as defined in s. 4943(c).

(c)  Make any investments in a manner that subjects the foundation to tax under s. 4944.

(d)  Make any taxable expenditures as defined in s. 4945(d).

(4)  Paragraphs (3)(b) and (c) shall not apply to a split interest trust if:

(a)  All the income interest, and none of the remainder interest, of the trust is devoted solely to one or more of the purposes described in s. 170(c)(2)(B), and all amounts in the trust for which a deduction was allowed under s. 170, s. 545(b)(2), s. 556(b)(2), s. 642(c), s. 2055, s. 2106(a)(2), or s. 2522 have an aggregate fair market value of not more than 60 percent of the aggregate fair market value of all amounts in the trust; or

(b)  A deduction was allowed under s. 170, s. 545(b)(2), s. 556(b)(2), s. 642(c), s. 2055, s. 2106(a)(2), or s. 2522 for amounts payable under the terms of the trust to every remainder beneficiary, but not to any income beneficiary.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221; s. 1, ch. 77-174; s. 1049, ch. 97-102.

Note.--Created from former s. 691.14.

737.505  Notice that this part does not apply.--In the case of a power to make distributions, if the trustee determines that the governing instrument contains provisions that are more restrictive than s. 737.504(2), or if the trust contains other powers, inconsistent with the provisions of s. 737.504(3) that specifically direct acts by the trustee, the trustee shall notify the state attorney within 6 months after November 1, 1971, or when the trust becomes subject to this part, whichever last occurs. Section 737.504 shall not apply to any trust for which notice has been given unless the trust is amended to comply with the terms of this part.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.15.

737.506  Power to amend trust instrument.--

(1)  In the case of a trust that is solely for a named charitable organization or organizations and for which the trustee does not possess any discretion concerning the distribution of income or principal among two or more such organizations, the trustee may amend the governing instrument to comply with the provisions of s. 737.504(2) with the consent of the named charitable organization or organizations.

(2)  In the case of a charitable trust that is not subject to the provisions of subsection (1), the trustee may amend the governing instrument to comply with the provisions of s. 737.504(2) with the consent of the state attorney.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.16.

737.507  Power of court to permit deviation.--This part does not affect the power of a court to relieve a trustee from any restrictions on his or her powers and duties that are placed upon him or her by the governing instrument or applicable law for cause shown and upon complaint of the trustee, state attorney, or an affected beneficiary and notice to the affected parties.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221; s. 1050, ch. 97-102.

Note.--Created from former s. 691.17.

737.508  Release; property and persons affected; manner of effecting.--

(1)  The trustee of a trust, all of the unexpired interests in which are devoted to one or more charitable purposes, may release a power to select charitable donees unless the creating instrument provides otherwise.

(2)  The release of a power to select charitable donees may apply to all or any part of the property subject to the power and may reduce or limit the charitable organizations, or classes of charitable organizations, in whose favor the power is exercisable.

(3)  A release shall be effected by a duly acknowledged written instrument signed by the trustee and delivered as provided in subsection (4).

(4)  Delivery of a release shall be accomplished as follows:

(a)  If the release is accomplished by specifying a charitable organization or organizations as beneficiary or beneficiaries of the trust, by delivery of a copy of the release to each designated charitable organization.

(b)  If the release is accomplished by reducing the class of permissible charitable organizations, by delivery of a copy of the release to the state attorney.

(5)  If a release is accomplished by specifying a public charitable organization or organizations as beneficiary or beneficiaries of the trust, the trust at all times thereafter shall be operated exclusively for the benefit of, and be supervised by, the specified public charitable organization or organizations.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.18.

737.509  Election to come under this part.--With the consent of that organization or organizations, a trustee of a trust for the benefit of a public charitable organization or organizations may come under s. 737.508(5) by filing with the state attorney an election, accompanied by the proof of required consent. Thereafter the trust shall be subject to ss. 737.508(5) and 737.510.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.19.

737.510  Supervision by public charitable organization.--

(1)  The trustee of a trust subject to the supervision by a specified public charitable organization or organizations, as provided in s. 737.508(5) shall file with each specified charitable organization:

(a)  A true copy of the governing instrument with a verified written report setting forth complete information concerning the nature of the assets and liabilities at the delivery of the release pursuant to s. 737.508(4), or the filing of the election under s. 737.509.

(b)  An annual report within 41/2 months following the close of each year setting forth a complete statement of receipts, disbursements, assets with cost and market value of each asset, and liabilities.

(c)  Such other information as may be necessary to compel proper administration of the trust.

(2)  By delivery of the release or execution of the election, as the case may be, the trustee and each specified public charitable organization, by accepting delivery of the release as provided in s. 737.508(4), or by consenting to the election in s. 737.509, agree that the public charitable organization or organizations shall have:

(a)  The power and duty to compel the proper administration of the trust.

(b)  The power to inspect the books, records, memoranda, papers, documents of title, and evidence of assets, liabilities, receipts, or disbursements in the possession or control of the trustee or other person having custody of the books and records.

(c)  The power to require such other information as may be necessary to compel proper administration of the trust.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.20.

737.511  Interpretation.--This part shall be interpreted to effectuate the intent of the state to preserve, foster, and encourage gifts to, or for the benefit of, charitable organizations.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.21.

737.512  Inapplicability to certain trusts.--This part shall not apply to any trust to the extent that a court shall determine, in a proceeding initiated before November 1, 1971, that the application would be contrary to the terms of the instrument governing the trust and that it may not properly be changed to conform to the provisions of this part, but nothing herein shall be construed as creating or imposing on the trustee of any trust any obligation to initiate a proceeding to obtain any court determination with respect to the application of the provisions of this part.

History.--s. 1, ch. 74-106; s. 12, ch. 75-221.

Note.--Created from former s. 691.22.

737.621  Rules of construction; general provisions.

737.622  Change in securities; accessions; nonademption.

737.623  Construction of generic terms.

737.624  Gifts to be per stirpes.

737.625  Killer not entitled to receive property or other benefits by reason of victim's death.

737.627  Costs and attorney's fees.

737.621  Rules of construction; general provisions.--The intention of the grantor as expressed in the trust controls the legal effect of the dispositions therein made. The rules of construction as expressed in this part shall apply unless a contrary intention is indicated by the terms of the trust.

History.--s. 16, ch. 93-257.

737.622  Change in securities; accessions; nonademption.--A gift of specific securities, rather than their equivalent value, shall entitle the beneficiary only to:

(1)  As much of the gifted securities of the same issuer held by the trust estate at the time of the occurrence of the event entitling the beneficiary to distribution.

(2)  Any additional or other securities of the same issuer held by the trust estate because of action initiated by the issuer, excluding any acquired by exercise of purchase options.

(3)  Securities of another issuer held by the trust estate as a result of a merger, consolidation, reorganization, or other similar action initiated by the original issuer.

History.--s. 16, ch. 93-257.

737.623  Construction of generic terms.--Adopted persons and persons born out of wedlock are included in class gift terminology and terms of relationship, in accordance with rules for determining relationships for purposes of intestate succession.

History.--s. 16, ch. 93-257.

737.624  Gifts to be per stirpes.--Unless the trust instrument provides otherwise, all class gifts shall be per stirpes.

History.--s. 16, ch. 93-257.

737.625  Killer not entitled to receive property or other benefits by reason of victim's death.--A beneficiary of a trust who unlawfully kills the grantor or another person upon whose death such beneficiary's interest depends, shall not be entitled to any trust interest dependent upon the victim's death, and such interest shall devolve as though the killer had predeceased the victim.

History.--s. 16, ch. 93-257.

737.627  Costs and attorney's fees.--In all actions challenging the proper exercise of a trustee's powers, the court shall award taxable costs as in chancery actions, including attorney's fees.

History.--s. 16, ch. 93-257.