As Reported by the House Financial Institutions Committee      1            

122nd General Assembly                                             4            

   Regular Session                            Sub. H. B. No. 701   5            

      1997-1998                                                    6            


    REPRESENTATIVES MASON-WOMER BENJAMIN-HARRIS-TERWILLEGER-       8            

  TAYLOR-GARCIA-EVANS-TIBERI-SALERNO-HAINES-HOUSEHOLDER-MILLER     9            


                                                                   11           

                           A   B I L L                                          

             To amend sections 1111.13, 2109.37, and 2109.371; to  13           

                amend, for purposes of adopting a new section      14           

                number as indicated in parentheses,  section       15           

                1339.60 (1339.68); and to enact new section        16           

                1339.60 and sections  1339.52, 1339.53, 1339.54,   18           

                1339.55, 1339.56, 1339.57, 1339.58,  1339.59, and  19           

                1339.61 of the Revised Code to adopt the Uniform   20           

                Prudent Investor Act of  the National Conference   22           

                of Commissioners on Uniform State  Laws.           23           




BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:        25           

      Section 1.  That sections 1111.13, 2109.37, and 2109.371 be  27           

amended, section 1339.60 (1339.68) be amended for the purpose of   28           

adopting a new section number as indicated in parentheses, and     29           

new section 1339.60 and sections 1339.52, 1339.53, 1339.54,        30           

1339.55, 1339.56, 1339.57, 1339.58, 1339.59, and 1339.61 of the    31           

Revised Code be enacted to read as follows:                                     

      Sec. 1111.13.  (A)(1)  Except as provided in divisions       40           

(A)(2) and (G) of this section or as otherwise provided by the     41           

instrument creating the trust, a trust company acting as           42           

fiduciary under any instrument and having funds of the trust       44           

which are to be invested may, in addition to any other                          

investments authorized to a trust company by law, invest them in   46           

any of the following:                                                           

      (a)  Forms of investments enumerated or described in, or     48           

made eligible for investment by, sections 1339.44, 1339.52 TO      49           

                                                          2      

                                                                 
1339.61, 2109.37, 2109.371, and 2109.372 of the Revised Code,      51           

including, but not limited to, securities, stocks, bonds, or       52           

certificates of deposit issued by the trust company or any bank    53           

owned or controlled by the bank holding company that owns or       55           

controls the trust company.  Investment authority granted under                 

division (A)(1)(a) of this section is subject to the limitations   56           

on investments specified in division (B) of section 2109.371 of    57           

the Revised Code.                                                  58           

      (b)  Any collective investment fund established and          60           

maintained by the trust company or by an affiliate of the trust    62           

company;                                                                        

      (c)  The securities of any investment company, including     64           

any affiliated investment company, whether or not the trust        65           

company has invested other funds held by it in an agency or other  66           

nonfiduciary capacity in the securities of the same investment     67           

company or affiliated investment company.                          68           

      (2)  A trust company acting as fiduciary may not invest its  71           

trust funds in stock issued by the fiduciary itself except under   72           

one of the following circumstances:                                73           

      (a)  In the case of a testamentary instrument, when          75           

expressly permitted by the instrument creating the relationship    76           

and authorized by court order;                                     77           

      (b)  In the case of an inter vivos instrument, when          79           

expressly permitted by the instrument or authorized by court       80           

order and in either case, only when directed to purchase or        81           

invest in the stock by a cofiduciary or other person other than    83           

the trust company who has the right under the terms of the                      

instrument to direct the investment;                               84           

      (c)  When exercising rights to purchase its own stock or to  86           

purchase or convert securities convertible into its own stock if   87           

the rights were offered pro rata to the shareholders;              88           

      (d)  To complement fractional shares acquired when the       90           

exercise of rights or receipt of a stock dividend results in       91           

fractional shareholdings.                                          92           

                                                          3      

                                                                 
      (3)  If the law or the instrument creating a trust           94           

expressly permits investment in direct obligations of the United   95           

States or an agency or instrumentality of the United States,       97           

unless expressly prohibited by the instrument, a trust company     98           

also may invest in no front end load money market mutual funds     100          

consisting exclusively of obligations of the United States or an   101          

agency or instrumentality of the United States and in repurchase   102          

agreements, including those issued by the trust company itself,    104          

secured by obligations of the United States or an agency or        105          

instrumentality of the United States, or in securities of other    107          

no load money market mutual funds whose portfolios are similarly                

restricted; and in collective investment funds established in      108          

accordance with section 1111.14 of the Revised Code or by an       110          

affiliate of the trust company and consisting exclusively of any   111          

direct obligations of the United States or an agency or            113          

instrumentality of the United States, notwithstanding division     114          

(A)(1)(c) of that section.                                                      

      (B)  A trust company acting in any fiduciary capacity or     117          

under any instrument has the right to retain any part of the       118          

trust or estate it receives, whether from the creator of the       119          

trust or the estate, at its inception or by later addition, or by  120          

addition by any other person who is authorized to make additions   121          

to the trust or estate, and any investments the trust company      123          

makes.                                                                          

      (C)  Except as otherwise expressly provided by the           125          

instrument creating the fiduciary relationship, any trust company  126          

may exercise all voting, consenting, and dissenting rights,        127          

including the right to vote for the election of directors,         128          

pertaining to stocks, bonds, or other securities held by it in     129          

any fiduciary capacity, including rights pertaining to stocks,     131          

bonds, or other securities issued by the trust company in its      132          

individual corporate capacity and held by it in any fiduciary      133          

capacity, provided:                                                134          

      (1)  In the case of any fiduciary relationship created       136          

                                                          4      

                                                                 
prior to January 1, 1968, voting rights pertaining to any shares   137          

of a trust company's own stock held by it in a fiduciary           139          

relationship, if exercised, shall be exercised with respect to     140          

the election of directors, only in accordance with any provisions  141          

of law applicable to that election and without regard to the       142          

first paragraph of division (C) and divisions (C)(2)(a), (b), and  143          

(c) of this section, and those portions of division (C) of this    145          

section shall not be construed to be determinative of the voting   147          

rights or to be declaratory of a public policy with respect to                  

the voting rights.                                                 148          

      (2)  In the case of any fiduciary relationship created on    150          

or after January 1, 1968, voting rights pertaining to any shares   151          

of a trust company's own stock held by it in a fiduciary           153          

relationship shall be exercised by it with respect to the          154          

election of directors, only if and as directed in writing by any   155          

person described in division (C)(2)(a), (b), or (c) of this        156          

section, provided that the person may not be the trust company,    158          

or a director, officer, or employee of the trust company except    159          

as to fiduciary relationships in which the director, officer, or   161          

employee is a settlor or beneficiary, or a nominee, agent,         162          

attorney, or subsidiary of the trust company:                      163          

      (a)  Any person, including a settlor or beneficiary, who     165          

has the right under the terms of the instrument under which        166          

shares are held to determine the manner in which shares shall be   167          

voted, or if there is no such person;                              168          

      (b)  Any person acting as cofiduciary under the instrument   170          

under which such shares are held, or if there is no such person;   172          

      (c)  Any person, having the right of revocation or           174          

amendment of the instrument under which the shares are held.       176          

      (D)  If there is more than one person having power to        178          

direct voting under division (C)(2)(a), (b), or (c) of this        179          

section and they fail to agree, each person shall have the right   181          

to direct voting with respect to the election of directors as to   182          

an equal number of shares.                                                      

                                                          5      

                                                                 
      (E)  As used in this section:                                184          

      (1)  "Affiliated investment company" means any investment    186          

company that is any of the following:                              187          

      (a)  Sponsored by the trust company that is acting as        190          

fiduciary or by a trust company, bank, bank subsidiary                          

corporation, or other corporation owned or controlled by the bank  191          

holding company that owns or controls the trust company that is    192          

acting as fiduciary;                                               193          

      (b)  The result of any agreement with a trust company,       195          

bank, bank subsidiary corporation, or other corporation owned or   197          

controlled by the bank holding company that owns or controls the                

trust company that is acting as fiduciary;                         198          

      (c)  Established exclusively for the customers or accounts   200          

of the trust company that is acting as fiduciary or of a trust     202          

company, bank, bank subsidiary corporation, or other corporation   203          

owned or controlled by the bank holding company that owns or       204          

controls the trust company that is acting as fiduciary;            206          

      (d)  Provided with investment advisory, brokerage, transfer  208          

agency, registrar, management, shareholder servicing, custodian,   209          

or any related services by the trust company that is acting as     211          

fiduciary or by a trust company, bank, bank subsidiary             212          

corporation, or other corporation owned or controlled by the bank  214          

holding company that owns or controls the trust company that is    215          

acting as fiduciary.                                                            

      (2)  "Cofiduciary" includes, but is not limited to, a        217          

cotrustee, coexecutor, coadministrator, coguardian, co-agent, and  218          

any person who, under the terms of the instrument creating the     219          

fiduciary relationship, has the right or power to direct, approve  220          

or consent to, or be consulted with respect to, the making,        221          

retention, or sale of investments under the instrument.            222          

      (3)  "Instrument" includes, but is not limited to, any       224          

will, declaration of trust, agreement of trust, agency, or         225          

custodianship, or court order creating a fiduciary relationship.   226          

      (4)  "Reasonable fee" means compensation or payment, the     229          

                                                          6      

                                                                 
receipt of which would not constitute a breach of fiduciary duty   230          

under section 36 of the "Investment Company Act of 1940," 54       231          

Stat. 789, 15 U.S.C.A. 80a-35.                                     232          

      (F)  Shares as to which the voting rights with respect to    234          

the election of directors may not be exercised under this section  235          

shall not be considered as outstanding for the purpose of          236          

computing the voting power of the corporation or of its shares of  237          

any class with respect to the election of directors.               238          

      (G)  This section does not authorize a trust company acting  240          

as a probate fiduciary to perform any act prohibited by section    242          

2109.44 of the Revised Code, unless the act is authorized by the   244          

instrument creating the trust.                                                  

      (H)  A trust company making an investment of trust funds in  246          

an affiliated investment company, or a bank or other corporation   247          

owned or controlled by the bank holding company that owns or       249          

controls the trust company, may charge a reasonable fee for        250          

investment advisory, brokerage, transfer agency, registrar,        251          

management, shareholder servicing, custodian, or any related       252          

services provided to an affiliated investment company.  The fee    253          

may be in addition to the compensation that the trust company is   254          

otherwise entitled to receive from the trust, provided that the    256          

fee is charged as a percentage of either asset value or income                  

earned or actual amount charged and is disclosed at least          257          

annually by prospectus, account statement, or any other written    258          

means to all persons entitled to receive statements of account     259          

activity.                                                          260          

      (I)  A trust company making an investment of trust funds in  262          

the securities of an affiliated investment company pursuant to     263          

division (A)(1)(c) of this section shall, when providing any       264          

periodic account statements to the trust fund, report the net      265          

asset value of the shares comprising the investment of the trust   266          

fund in the affiliated investment company.                         267          

      (J)  If a trust company making an investment of trust funds  269          

in the securities of an affiliated investment company pursuant to  270          

                                                          7      

                                                                 
division (A)(1)(c) of this section invests the funds in any        271          

mutual fund, the trust company shall disclose, in at least         272          

ten-point boldface type, by prospectus, account statement, or any  273          

other written means to all persons entitled to receive statements  274          

of account activity, that the mutual fund is not insured or        275          

guaranteed by the federal deposit insurance corporation or by any  276          

other government agency or government-sponsored agency of the      277          

federal government or of this state.                               278          

      Sec. 1339.52.  (A)  AS USED IN SECTIONS 1339.52 TO 1339.61   280          

OF THE REVISED CODE, "TRUSTEE" MEANS A TRUSTEE UNDER ANY           282          

TESTAMENTARY, INTER VIVOS, OR OTHER TRUST.                                      

      (B)  EXCEPT AS PROVIDED IN DIVISION (C) OR (D) OF THIS       285          

SECTION, A TRUSTEE WHO INVESTS AND MANAGES TRUST ASSETS UNDER                   

SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE OWES A DUTY TO     288          

THE BENEFICIARIES OF THE TRUST TO COMPLY WITH SECTIONS 1339.52 TO  289          

1339.61 OF THE REVISED CODE.                                       291          

      (C)  SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE MAY BE  295          

EXPANDED, RESTRICTED, ELIMINATED, OR OTHERWISE ALTERED, WITHOUT    296          

EXPRESS REFERENCE TO THESE SECTIONS BY THE INSTRUMENT CREATING A   297          

TRUST.                                                             298          

      (D)  A TRUSTEE IS NOT LIABLE TO A BENEFICIARY OF A TRUST TO  300          

THE EXTENT THE TRUSTEE ACTED IN REASONABLE RELIANCE ON THE         301          

PROVISIONS OF THE TRUST.                                           302          

      Sec. 1339.53.  (A)  A TRUSTEE SHALL INVEST AND MANAGE TRUST  304          

ASSETS AS A PRUDENT INVESTOR WOULD, BY CONSIDERING THE PURPOSES,   306          

TERMS, DISTRIBUTION REQUIREMENTS, AND OTHER CIRCUMSTANCES OF THE   307          

TRUST.  IN SATISFYING THIS REQUIREMENT, THE TRUSTEE SHALL          308          

EXERCISE REASONABLE CARE, SKILL, AND CAUTION.                      309          

      (B)  A TRUSTEE SHALL MAKE A REASONABLE EFFORT TO VERIFY      312          

FACTS RELEVANT TO THE INVESTMENT AND MANAGEMENT OF TRUST ASSETS.   313          

      (C)  A TRUSTEE WHO HAS SPECIAL SKILLS OR EXPERTISE, OR IS    316          

NAMED TRUSTEE IN RELIANCE UPON THE TRUSTEE'S REPRESENTATION THAT   317          

THE TRUSTEE HAS SPECIAL SKILLS OR EXPERTISE, HAS A DUTY TO USE     318          

THOSE SPECIAL SKILLS OR EXPERTISE.                                 319          

                                                          8      

                                                                 
      (D)  A TRUSTEE'S INVESTMENT AND MANAGEMENT DECISIONS         322          

RESPECTING INDIVIDUAL TRUST ASSETS SHALL NOT BE EVALUATED IN       323          

ISOLATION BUT IN THE CONTEXT OF THE TRUST PORTFOLIO AS A WHOLE     324          

AND AS PART OF AN OVERALL INVESTMENT STRATEGY HAVING RISK AND      325          

RETURN OBJECTIVES REASONABLY SUITED TO THE TRUST.                  326          

      (E)  AMONG CIRCUMSTANCES THAT A TRUSTEE SHALL CONSIDER IN    329          

INVESTING AND MANAGING TRUST ASSETS ARE THE FOLLOWING AS ARE       330          

RELEVANT TO THE TRUST OR ITS BENEFICIARIES:                        331          

      (1)  THE GENERAL ECONOMIC CONDITIONS;                        333          

      (2)  THE POSSIBLE EFFECT OF INFLATION OR DEFLATION;          335          

      (3)  THE EXPECTED TAX CONSEQUENCES OF INVESTMENT DECISIONS   337          

OR STRATEGIES;                                                     338          

      (4)  THE ROLE THAT EACH INVESTMENT OR COURSE OF ACTION       340          

PLAYS WITHIN THE OVERALL TRUST PORTFOLIO, WHICH MAY INCLUDE        341          

FINANCIAL ASSETS, INTERESTS IN CLOSELY HELD ENTERPRISES, TANGIBLE  343          

AND INTANGIBLE PERSONAL PROPERTY, AND REAL PROPERTY;               344          

      (5)  THE EXPECTED TOTAL RETURN FROM INCOME AND APPRECIATION  346          

OF CAPITAL;                                                        347          

      (6)  OTHER RESOURCES OF THE BENEFICIARIES;                   349          

      (7)  NEEDS FOR LIQUIDITY, REGULARITY OF INCOME, AND          351          

PRESERVATION OR APPRECIATION OF CAPITAL;                           352          

      (8)  AN ASSET'S SPECIAL RELATIONSHIP OR SPECIAL VALUE, IF    354          

ANY, TO THE PURPOSES OF THE TRUST OR TO ONE OR MORE OF THE         355          

BENEFICIARIES.                                                     356          

      Sec. 1339.54. (A)  A TRUSTEE MAY INVEST IN ANY KIND OF       358          

PROPERTY OR TYPE OF INVESTMENT PROVIDED THAT THE INVESTMENT IS     359          

CONSISTENT WITH THE REQUIREMENTS AND STANDARDS OF SECTIONS         360          

1339.52 TO 1339.61 OF THE REVISED CODE.                            362          

      (B)  A TRUSTEE SHALL DIVERSIFY THE INVESTMENTS OF A TRUST    365          

UNLESS THE TRUSTEE REASONABLY DETERMINES THAT, BECAUSE OF SPECIAL  366          

CIRCUMSTANCES, THE PURPOSES OF THE TRUST ARE BETTER SERVED         367          

WITHOUT DIVERSIFYING.                                              368          

      Sec. 1339.55.  (A)  A TRUSTEE SHALL INVEST AND MANAGE THE    371          

TRUST ASSETS SOLELY IN THE INTEREST OF THE BENEFICIARIES.          372          

                                                          9      

                                                                 
      (B)  IF A TRUST HAS TWO OR MORE BENEFICIARIES, THE TRUSTEE   375          

SHALL ACT IMPARTIALLY IN INVESTING AND MANAGING THE TRUST ASSETS   376          

TAKING INTO ACCOUNT ANY DIFFERING INTERESTS OF THE BENEFICIARIES.  377          

      Sec. 1339.56.  WITHIN A REASONABLE TIME AFTER ACCEPTING A    379          

TRUSTEESHIP OR RECEIVING TRUST ASSETS, A TRUSTEE SHALL REVIEW THE  381          

TRUST ASSETS AND MAKE AND IMPLEMENT DECISIONS CONCERNING THE                    

RETENTION AND DISPOSITION OF TRUST ASSETS IN ORDER TO BRING THE    382          

TRUST PORTFOLIO INTO COMPLIANCE WITH THE PURPOSES, TERMS,          383          

DISTRIBUTION REQUIREMENTS, AND OTHER CIRCUMSTANCES OF THE TRUST,   384          

AND IN ORDER TO COMPLY WITH THE REQUIREMENTS AND STANDARDS OF      385          

SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE.                   388          

      Sec. 1339.57.  EXCEPT AS OTHERWISE PERMITTED BY LAW, IN      390          

INVESTING AND MANAGING TRUST ASSETS, A TRUSTEE MAY ONLY INCUR      392          

COSTS THAT ARE APPROPRIATE AND REASONABLE IN RELATION TO THE       393          

ASSETS, THE PURPOSES OF THE TRUST, AND THE SKILLS OF THE TRUSTEE.  394          

      Sec. 1339.58.  COMPLIANCE WITH SECTIONS 1339.52 TO 1339.61   396          

OF THE REVISED CODE SHALL BE DETERMINED IN LIGHT OF THE FACTS AND  399          

CIRCUMSTANCES EXISTING AT THE TIME OF A TRUSTEE'S DECISION OR      400          

ACTION AND NOT BY HINDSIGHT.                                                    

      Sec. 1339.59.  (A)  A TRUSTEE MAY DELEGATE INVESTMENT AND    403          

MANAGEMENT FUNCTIONS OF A TRUST THAT A PRUDENT TRUSTEE HAVING      404          

COMPARABLE SKILLS COULD PROPERLY DELEGATE UNDER THE                405          

CIRCUMSTANCES.  IN ACCORDANCE WITH THIS DIVISION, A TRUSTEE SHALL  406          

EXERCISE REASONABLE CARE, SKILL, AND CAUTION IN DOING ALL OF THE   407          

FOLLOWING:                                                                      

      (1)  SELECTING AN AGENT;                                     409          

      (2)  ESTABLISHING THE SCOPE AND TERMS OF THE DELEGATION      411          

CONSISTENT WITH THE PURPOSES AND TERMS OF THE TRUST;               412          

      (3)  PERIODICALLY REVIEWING THE AGENT'S ACTIONS IN ORDER TO  414          

MONITOR THE AGENT'S PERFORMANCE WITH THE TERMS OF THE DELEGATION.  416          

      (B)  IN PERFORMING INVESTMENT OR MANAGEMENT FUNCTIONS OF A   419          

TRUST THAT ARE DELEGATED TO AN AGENT, AN AGENT OWES A DUTY TO THE  420          

TRUST TO EXERCISE REASONABLE CARE TO COMPLY WITH THE TERMS OF THE  421          

DELEGATION.                                                        422          

                                                          10     

                                                                 
      (C)  A TRUSTEE WHO COMPLIES WITH DIVISION (A) OF THIS        426          

SECTION IS NOT LIABLE TO THE BENEFICIARIES OF THE TRUST OR TO THE  427          

TRUST FOR THE DECISIONS OR ACTIONS OF THE AGENT TO WHOM THE        428          

FUNCTION WAS DELEGATED.                                                         

      (D) BY ACCEPTING THE DELEGATION OF INVESTMENT OR MANAGEMENT  431          

FUNCTIONS OF A TRUST THAT IS SUBJECT TO THE LAWS OF THIS STATE,    432          

AN AGENT SUBMITS TO THE JURISDICTION OF THIS STATE.                433          

      Sec. 1339.60.  THE FOLLOWING TERMS OR COMPARABLE LANGUAGE    435          

IN THE PROVISIONS OF A TRUST, UNLESS OTHERWISE LIMITED OR          436          

MODIFIED, AUTHORIZES ANY INVESTMENT OR STRATEGY PERMITTED BY       437          

SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE:  "INVESTMENTS     438          

PERMISSIBLE BY LAW FOR INVESTMENT OF TRUST FUNDS"; "LEGAL          440          

INVESTMENTS"; "AUTHORIZED INVESTMENTS"; "USING THE JUDGMENT AND    441          

CARE UNDER THE CIRCUMSTANCES THEN PREVAILING THAT PERSONS OF       442          

PRUDENCE, DISCRETION, AND INTELLIGENCE EXERCISE IN THE MANAGEMENT  443          

OF THEIR OWN AFFAIRS, NOT IN REGARD TO SPECULATION BUT IN REGARD   444          

TO THE PERMANENT DISPOSITION OF THEIR FUNDS CONSIDERING THE        445          

PROBABLE INCOME AS WELL AS THE PROBABLE SAFETY OF THEIR CAPITAL";  446          

"PRUDENT MAN RULE"; "PRUDENT TRUSTEE RULE"; "PRUDENT PERSON        447          

RULE"; AND "PRUDENT INVESTOR RULE."                                448          

      Sec. 1339.61.  (A)  SECTIONS 1339.52 TO 1339.61 OF THE       451          

REVISED CODE SHALL BE APPLIED AND CONSTRUED TO EFFECTUATE THE      453          

GENERAL PURPOSE TO MAKE UNIFORM THE LAW WITH RESPECT TO THE        454          

SUBJECT OF THESE SECTIONS AMONG THE STATES ENACTING IT.  THESE     455          

SECTIONS MAY BE CITED AS THE "OHIO UNIFORM PRUDENT INVESTOR ACT."  460          

      (B)  SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE APPLY   464          

TO TRUSTS EXISTING ON OR CREATED AFTER THE EFFECTIVE DATE OF       465          

THESE SECTIONS.  AS APPLIED TO TRUSTS EXISTING ON THE EFFECTIVE    466          

DATE OF THESE SECTIONS, SECTIONS 1339.52 TO 1339.61 OF THE         468          

REVISED CODE GOVERN ONLY DECISIONS OR ACTIONS OCCURRING AFTER THE  470          

EFFECTIVE DATE OF THESE SECTIONS.                                  471          

      (C)  THE TEMPORARY INVESTMENT OF CASH OR FUNDS PURSUANT TO   474          

SECTION 1339.44 OR 2109.372 OF THE REVISED CODE SHALL BE           476          

CONSIDERED A PRUDENT INVESTMENT IN COMPLIANCE WITH SECTIONS        477          

                                                          11     

                                                                 
1339.52 TO 1339.61 OF THE REVISED CODE.                            479          

      Sec. 1339.60 1339.68.  (A)  As used in this section:         488          

      (1)  "Disclaimant" means any person, any guardian or         490          

personal representative of a person or estate of a person, or any  491          

attorney-in-fact or agent of a person having a general or          492          

specific authority to act granted in a written instrument, who is  493          

any of the following:                                              494          

      (a)  With respect to testamentary instruments and intestate  496          

succession, an heir, next of kin, devisee, legatee, donee, person  497          

succeeding to a disclaimed interest, surviving joint tenant,       498          

surviving tenant by the entireties, surviving tenant of a tenancy  499          

with a right of survivorship, beneficiary under a testamentary     500          

instrument, or person designated to take pursuant to a power of    501          

appointment exercised by a testamentary instrument;                502          

      (b)  With respect to nontestamentary instruments, a          504          

grantee, donee, person succeeding to a disclaimed interest,        505          

surviving joint tenant, surviving tenant by the entireties,        506          

surviving tenant of a tenancy with a right of survivorship,        507          

beneficiary under a nontestamentary instrument, or person          508          

designated to take pursuant to a power of appointment exercised    509          

by a nontestamentary instrument;                                   510          

      (c)  With respect to fiduciary rights, privileges, powers,   512          

and immunities, a fiduciary under a testamentary or                513          

nontestamentary instrument.  This section does not authorize a     514          

fiduciary to disclaim the rights of beneficiaries unless the       515          

instrument creating the fiduciary relationship authorizes such a   516          

disclaimer.                                                        517          

      (d)  Any person entitled to take an interest in property     519          

upon the death of a person or upon the occurrence of any other     520          

event.                                                             521          

      (2)  "Property" means all forms of property, real and        523          

personal, tangible and intangible.                                 524          

      (B)(1)  A disclaimant, other than a fiduciary under an       526          

instrument who is not authorized by the instrument to disclaim     527          

                                                          12     

                                                                 
the interest of a beneficiary, may disclaim, in whole or in part,  528          

the succession to any property by executing and by delivering,     529          

filing, or recording a written disclaimer instrument in the        530          

manner provided in this section.                                   531          

      (2)  A disclaimant who is a fiduciary under an instrument    533          

may disclaim, in whole or in part, any right, power, privilege,    534          

or immunity, by executing and by delivering, filing, or recording  535          

a written disclaimer instrument in the manner provided in this     536          

section.                                                           537          

      (3)  The written instrument of disclaimer shall be signed    539          

and acknowledged by the disclaimant and shall contain all of the   540          

following:                                                         541          

      (a)  A reference to the donative instrument;                 543          

      (b)  A description of the property, part of property, or     545          

interest disclaimed, and of any fiduciary right, power,            546          

privilege, or immunity disclaimed;                                 547          

      (c)  A declaration of the disclaimer and its extent.         549          

      (4)  The guardian of the estate of a minor or an             551          

incompetent, or the personal representative of a deceased person,  552          

with the consent of the probate division of the court of common    553          

pleas, may disclaim, in whole or in part, the succession to any    554          

property, or interest in property, that the ward, if an adult and  555          

competent, or the deceased, if living, might have disclaimed. The  557          

guardian or personal representative, or any interested person may  558          

file an application with the probate division of the court of                   

common pleas that has jurisdiction of the estate, asking that the  559          

court order the guardian or personal representative to execute     560          

and deliver, file, or record the disclaimer on behalf of the ward  561          

or estate.  The court shall order the guardian or personal         562          

representative to execute and deliver, file, or record the         563          

disclaimer if the court finds, upon hearing after notice to        564          

interested parties and such other persons as the court shall       565          

direct, that:                                                      566          

      (a)  It is in the best interests of those interested in the  568          

                                                          13     

                                                                 
estate of the person and of those who will take the disclaimed     569          

interest;                                                          570          

      (b)  It would not materially, adversely affect the minor or  572          

incompetent, or the beneficiaries of the estate of the decedent,   573          

taking into consideration other available resources and the age,   574          

probable life expectancy, physical and mental condition, and       575          

present and reasonably anticipated future needs of the minor or    576          

incompetent or the beneficiaries of the estate of the decedent.    577          

      A written instrument of disclaimer ordered by the court      579          

under this division shall be executed and be delivered, filed, or  580          

recorded within the time and in the manner in which the person     581          

could have disclaimed if he THE PERSON were living, an adult, and  583          

competent.                                                                      

      (C)  A partial disclaimer of property that is subject to a   585          

burdensome interest created by the donative instrument is not      586          

effective unless the disclaimed property constitutes a gift that   587          

is separate and distinct from undisclaimed gifts.                  588          

      (D)  The disclaimant shall deliver, file, or record the      590          

disclaimer, or cause the same to be done, not later than nine      591          

months after the latest of the following dates:                    592          

      (1)  The effective date of the donative instrument if both   594          

the taker and his THE TAKER'S interest in the property are         595          

finally ascertained on that date;                                  597          

      (2)  The date of the occurrence of the event upon which      599          

both the taker and his THE TAKER'S interest in the property        600          

become finally ascertainable;                                      602          

      (3)  The date on which the disclaimant attains twenty-one    604          

years of age or is no longer an incompetent, without tendering or  605          

repaying any benefit received while the disclaimant was under      606          

twenty-one years of age or an incompetent, and even if a guardian  607          

of a minor or incompetent had filed an application pursuant to     608          

division (B)(4) of this section and the probate division of the    609          

court of common pleas involved did not consent to the guardian     610          

executing a disclaimer.                                            611          

                                                          14     

                                                                 
      (E)  No disclaimer instrument is effective under this        613          

section if either of the following applies under the terms of the  614          

disclaimer instrument:                                             615          

      (1)  The disclaimant has power to revoke the disclaimer;     617          

      (2)  The disclaimant may transfer, or direct to be           619          

transferred, to himself SELF the entire legal and equitable        620          

ownership of the property subject to the disclaimer instrument.    622          

      (F)(1)  If the interest disclaimed is created by a           624          

nontestamentary instrument, the disclaimer instrument shall be     625          

delivered personally or by certified mail to the trustee or other  626          

person who has legal title to, or possession of, the property      627          

disclaimed.                                                        628          

      (2)  If the interest disclaimed is created by a              630          

testamentary instrument or by intestate succession, the            631          

disclaimer instrument shall be filed in the probate division of    632          

the court of common pleas in the county in which proceedings for   633          

the administration of the decedent's estate have been commenced,   634          

and an executed copy of the disclaimer instrument shall be         635          

delivered personally or by certified mail to the personal          636          

representative of the decedent's estate.                           637          

      (3)  If no proceedings for the administration of the         639          

decedent's estate have been commenced, the disclaimer instrument   640          

shall be filed in the probate division of the court of common      641          

pleas in the county in which proceedings for the administration    642          

of the decedent's estate might be commenced according to law. The  644          

disclaimer instrument shall be filed and indexed, and fees                      

charged, in the same manner as provided by law for an application  645          

to be appointed as personal representative to administer the       646          

decedent's estate.  The disclaimer is effective whether or not     647          

proceedings thereafter are commenced to administer the decedent's  648          

estate.  If proceedings thereafter are commenced for the           649          

administration of the decedent's estate, they shall be filed       650          

under, or consolidated with, the case number assigned to the       651          

disclaimer instrument.                                             652          

                                                          15     

                                                                 
      (4)  If an interest in real estate is disclaimed, an         654          

executed copy of the disclaimer instrument also shall be recorded  655          

in the office of the recorder of the county in which the real      656          

estate is located.  The disclaimer instrument shall include a      657          

description of the real estate with sufficient certainty to        658          

identify it, and shall contain a reference to the record of the    659          

instrument that created the interest disclaimed.  If title to the  660          

real estate is registered under Chapters 5309. and 5310. of the    661          

Revised Code, the disclaimer interest shall be entered as a        662          

memorial on the last certificate of title.  A spouse of a          663          

disclaimant has no dower or other interest in the real estate      664          

disclaimed.                                                        665          

      (G)  Unless the donative instrument expressly provides       667          

that, if there is a disclaimer, there shall not be any             668          

acceleration of remainders or other interests, the property, part  669          

of property, or interest in property disclaimed, and any future    670          

interest that is to take effect in possession or enjoyment at or   671          

after the termination of the interest disclaimed, shall descend,   672          

be distributed, or otherwise be disposed of, and shall be          673          

accelerated, in the following manner:                              674          

      (1)  If intestate or testate succession is disclaimed, as    676          

if the disclaimant had predeceased the decedent;                   677          

      (2)  If the disclaimant is one designated to take pursuant   679          

to a power of appointment exercised by a testamentary instrument,  680          

as if the disclaimant had predeceased the donee of the power;      681          

      (3)  If the donative instrument is a nontestamentary         683          

instrument, as if the disclaimant had died before the effective    684          

date of the nontestamentary instrument;                            685          

      (4)  If the disclaimer is of a fiduciary right, power,       687          

privilege, or immunity, as if the right, power, privilege, or      688          

immunity was never in the donative instrument.                     689          

      (H)  A disclaimer pursuant to this section is effective as   691          

of, and relates back for all purposes to, the date upon which the  692          

taker and his THE TAKER'S interest have been finally ascertained.  694          

                                                          16     

                                                                 
      (I)  A disclaimant who has a present and future interest in  696          

property, and disclaims his THE DISCLAIMANT'S present interest in  698          

whole or in part, is considered to have disclaimed his THE         699          

DISCLAIMANT'S future interest to the same extent, unless a         701          

contrary intention appears in the disclaimer instrument or the     702          

donative instrument.  A disclaimant is not precluded from          703          

receiving, as an alternative taker, a beneficial interest in the   704          

property disclaimed, unless a contrary intention appears in the    705          

disclaimer instrument or in the donative instrument.               706          

      (J)  The disclaimant's right to disclaim under this section  708          

is barred if, before the expiration of the period within which he  709          

THE DISCLAIMANT may disclaim the interest, he THE DISCLAIMANT      711          

does any of the following:                                         712          

      (1)  Assigns, conveys, encumbers, pledges, or transfers, or  714          

contracts to assign, convey, encumber, pledge, or transfer, the    715          

property or any interest in it;                                    716          

      (2)  Waives in writing his THE DISCLAIMANT'S right to        718          

disclaim and executes and delivers, files, or records the waiver   720          

in the manner provided in this section for a disclaimer            721          

instrument;                                                                     

      (3)  Accepts the property or an interest in it;              723          

      (4)  Permits or suffers a sale or other disposition of the   725          

property pursuant to judicial action against him THE DISCLAIMANT.  727          

      (K)  A fiduciary's application for appointment or            729          

assumption of duties as a fiduciary does not waive or bar his THE  730          

DISCLAIMANT'S right to disclaim a right, power, privilege, or      732          

immunity.                                                                       

      (L)  The right to disclaim under this section exists         734          

irrespective of any limitation on the interest of the disclaimant  735          

in the nature of a spendthrift provision or similar restriction.   736          

      (M)  A disclaimer instrument or written waiver of the right  738          

to disclaim that has been executed and delivered, filed, or        739          

recorded as required by this section is final and binding upon     740          

all persons.                                                       741          

                                                          17     

                                                                 
      (N)  The right to disclaim and the procedures for            743          

disclaimer established by this section are in addition to, and do  744          

not exclude or abridge, any other rights or procedures existing    745          

under any other section of the Revised Code or at common law to    746          

assign, convey, release, refuse to accept, renounce, waive, or     747          

disclaim property.                                                 748          

      (O)(1)  No person is liable for distributing or disposing    750          

of property in a manner inconsistent with the terms of a valid     751          

disclaimer if the distribution or disposition is otherwise proper  752          

and the person has no actual knowledge of the disclaimer.          753          

      (2)  No person is liable for distributing or disposing of    755          

property in reliance upon the terms of a disclaimer that is        756          

invalid because the right of disclaimer has been waived or barred  757          

if the distribution or disposition is otherwise proper and the     758          

person has no actual knowledge of the facts that constitute a      759          

waiver or bar to the right to disclaim.                            760          

      (P)(1)  A disclaimant may disclaim pursuant to this section  763          

any interest in property that is in existence on September 27,     764          

1976, if either the interest in the property or the taker of the   765          

interest in the property is not finally ascertained on that date.  766          

      (2)  No disclaimer executed pursuant to this section         768          

destroys or diminishes an interest in property that exists on      769          

September 27, 1976, in any person other than the disclaimant.      770          

      Sec. 2109.37.  (A)  Except as otherwise provided by law,     779          

INCLUDING DIVISION (D) OF THIS SECTION, or by the instrument       781          

creating the trust, a fiduciary having funds belonging to a trust  782          

which are to be invested may invest them in the following:         783          

      (1)  Bonds or other obligations of the United States or of   785          

this state;                                                        786          

      (2)  Bonds or other interest-bearing obligations of any      788          

county, municipal corporation, school district, or other legally   789          

constituted political taxing subdivision within the state,         790          

provided that such county, municipal corporation, school           791          

district, or other subdivision has not defaulted in the payment    792          

                                                          18     

                                                                 
of the interest on any of its bonds or interest-bearing            793          

obligations, for more than one hundred twenty days during the ten  794          

years immediately preceding the investment by such THE fiduciary   795          

in such THE bonds or other obligations, and provided that such     797          

county, municipal corporation, school district, or other           799          

subdivision, is not, at the time of such THE investment, in        800          

default in the payment of principal or interest on any of its      802          

bonds or other interest-bearing obligations;                       803          

      (3)  Bonds or other interest-bearing obligations of any      805          

other state of the United States which, within twenty years prior  806          

to the making of such investment, has not defaulted for more than  807          

ninety days in the payment of principal or interest on any of its  808          

bonds or other interest-bearing obligations;                       809          

      (4)  Any bonds issued by or for federal land banks and any   811          

debentures issued by or for federal intermediate credit banks      812          

under the "Federal Farm Loan Act of 1916," 39 Stat. 360, 12        813          

U.S.C.A. 641, as amended; or any debentures issued by or for       814          

banks for cooperatives under the "Farm Credit Act of 1933," 48     815          

Stat. 257, 12 U.S.C.A. 131, as amended;                            816          

      (5)  Notes which are:  (a) secured by a first mortgage on    818          

real estate held in fee and located in the state, improved by a    819          

unit designed principally for residential use for not more than    820          

four families or by a combination of such dwelling unit and        821          

business property, the area designed or used for nonresidential    822          

purposes not to exceed fifty per cent of the total floor area;     823          

(b) secured by a first mortgage on real estate held in fee and     824          

located in the state, improved with a building designed for        825          

residential use for more than four families or with a building     826          

used primarily for business purposes, if the unpaid principal of   827          

the notes secured by such mortgage does not exceed ten per cent    828          

of the value of the estate or trust or does not exceed five        829          

thousand dollars, whichever is greater; or (c) secured by a first  830          

mortgage on an improved farm held in fee and located in the        831          

state, provided that such mortgage requires that the buildings on  832          

                                                          19     

                                                                 
the mortgaged property shall be well insured against loss by       833          

fire, and so kept, for the benefit of the mortgagee, until the     834          

debt is paid, and provided that the unpaid principal of the notes  835          

secured by the mortgage shall not exceed fifty per cent of the     836          

fair value of the mortgaged real estate at the time such THE       837          

investment is made, and such THE notes shall be payable not more   838          

than five years after the date on which the investment in them is  840          

made; except that the unpaid principal of such THE notes may       841          

equal sixty per cent of the fair value of the mortgaged real       843          

estate at the time such THE investment is made, and may be         844          

payable over a period of fifteen years following the date of the   845          

investment by the fiduciary if regular installment payments are    846          

required sufficient to amortize four per cent or more of the       847          

principal of the outstanding notes per annum and if the unpaid     848          

principal and interest become due and payable at the option of     849          

the holder upon any default in the payment of any installment of   850          

interest or principal upon the notes, or of taxes, assessments,    851          

or insurance premiums upon the mortgaged premises or upon the      852          

failure to cure any such default within any grace period provided  853          

therein not exceeding ninety days in duration;                     854          

      (6)  Life, endowment, or annuity contracts of legal reserve  856          

life insurance companies regulated by sections 3907.01 to          857          

3907.21, 3909.01 to 3909.17, 3911.01 to 3911.24, 3913.01 to        858          

3913.10, 3915.01 to 3915.15, and 3917.01 to 3917.05 of the         859          

Revised Code, and licensed by the superintendent of insurance to   860          

transact business within the state, provided that the purchase of  861          

contracts authorized by this division shall be limited to          862          

executors or the successors to their powers when specifically      863          

authorized by will and to guardians and trustees, which contracts  864          

may be issued on the life of a ward, a beneficiary of a trust      865          

fund, or according to a will, or upon the life of a person in      866          

whom such ward or beneficiary has an insurable interest and such   867          

THE contracts shall be drawn by the insuring company so that the   869          

proceeds shall be the sole property of the person whose funds are  870          

                                                          20     

                                                                 
so invested;                                                       871          

      (7)  Notes or bonds secured by mortgages and insured by the  873          

federal housing administrator or debentures issued by such         874          

administrator;                                                     875          

      (8)  Obligations issued by a federal home loan bank created  877          

under the "Federal Home Loan Bank Act of 1932," 47 Stat. 725, 12   878          

U.S.C.A. 1421, as amended;                                         879          

      (9)  Shares and certificates or other evidences of deposits  881          

issued by a federal savings and loan association organized and     882          

incorporated under the "Home Owners' Loan Act of 1933," 48 Stat.   883          

128, 12 U.S.C.A. 1461, as amended, to the extent and only to the   884          

extent that those shares or certificates or other evidences of     885          

deposits are insured pursuant to the "Financial Institutions       886          

Reform, Recovery, and Enforcement Act of 1989," 103 Stat. 183, 12  887          

U.S.C.A. 1811, as amended;                                         888          

      (10)  Bonds issued by the home owners' loan corporation      890          

created under the "Home Owners' Act of 1933," 48 Stat. 128, 12     891          

U.S.C.A. 1461, as amended;                                         892          

      (11)  Obligations issued by the national mortgage            894          

association created under the "National Housing Act," 48 Stat.     895          

1246 (1934), 12 U.S.C.A. 1701, as amended;                         896          

      (12)  Shares and certificates or other evidences of          898          

deposits issued by a domestic savings and loan association         899          

organized under the laws of the state, which association has       900          

obtained insurance of accounts pursuant to the "Financial          901          

Institutions Reform, Recovery, and Enforcement Act of 1989," 103   902          

Stat. 183, 12 U.S.C.A. 1811, as amended, or as may be otherwise    903          

provided by law, only to the extent that such evidences of         904          

deposits are insured under that act, as amended;                   905          

      (13)  Shares and certificates or other evidences of          907          

deposits issued by a domestic savings and loan association         908          

organized under the laws of the state, provided that no fiduciary  909          

may invest such deposits except with the approval of the probate   910          

court, and then in an amount not to exceed the amount which the    911          

                                                          21     

                                                                 
fiduciary is permitted to invest under division (A)(12) of this    912          

section;                                                           913          

      (14)  In savings accounts in, or certificates or other       915          

evidences of deposits issued by, a national bank located in the    916          

state or a state bank located in and organized under the laws of   917          

the state by depositing such THE funds in the bank, and such       918          

national or state bank when itself acting in a fiduciary capacity  920          

may deposit such THE funds in savings accounts in, or              921          

certificates or other evidences of deposits issued by, its own     923          

savings department or any bank subsidiary corporation owned or     924          

controlled by the bank holding company that owns or controls such  925          

national or state bank; provided that no deposit shall be made by  926          

any fiduciary, individual, or corporate, unless the deposits of    927          

the depository bank are insured by the federal deposit insurance   928          

corporation created under the "Federal Deposit Insurance           929          

Corporation Act of 1933," 48 Stat. 162, 12 U.S.C. 264, as          930          

amended, and provided that the deposit of the funds of any one     931          

trust in any such savings accounts in, or certificates or other    932          

evidences of deposits issued by, any one bank shall not exceed     933          

the sum insured under that act, as amended;                        934          

      (15)  Obligations consisting of notes, bonds, debentures,    936          

or equipment trust certificates issued under an indenture, which   937          

are the direct obligations, or in the case of equipment trust      938          

certificates are secured by direct obligations, of a railroad or   939          

industrial corporation, or a corporation engaged directly and      940          

primarily in the production, transportation, distribution, or      941          

sale of electricity or gas, or the operation of telephone or       942          

telegraph systems or waterworks, or in some combination of them;   943          

provided that the obligor corporation is one which is              944          

incorporated under the laws of the United States, any state, or    945          

the District of Columbia, and the obligations are rated at the     946          

time of purchase in the highest or next highest classification     947          

established by at least two standard rating services selected      948          

from a list of the standard rating services which shall be         949          

                                                          22     

                                                                 
prescribed by the superintendent of financial institutions;        950          

provided that every such list shall be certified by such THE       952          

superintendent to the clerk of each probate court in the state,    954          

and shall continue in effect until a different list is prescribed  955          

and certified as provided in this division;                        956          

      (16)  Obligations issued, assumed, or guaranteed by the      959          

international finance corporation or by the international bank     961          

for reconstruction and development, the Asian development bank,    962          

the inter-American development bank, the African development       963          

bank, or other similar development bank in which the president,    964          

as authorized by congress and on behalf of the United States, has  965          

accepted membership, provided that the obligations are rated at    966          

the time of purchase in the highest or next highest                967          

classification established by at least one standard rating         968          

service selected from a list of standard rating services which     969          

shall be prescribed by the superintendent of financial                          

institutions;                                                                   

      (17)  Securities of any investment company, as defined in    971          

and registered under sections 3 and 8 of the "Investment Company   972          

Act of 1940," 54 Stat. 789, 15 U.S.C.A. 80a-3 and 80a-8, that are  973          

invested exclusively in forms of investment or in instruments      974          

that are fully collateralized by forms of investment in which the  975          

fiduciary is permitted to invest pursuant to divisions (A)(1) to   976          

(16) of this section, provided that, in addition to such forms of  977          

investment, such THE investment company may, for the purpose of    978          

reducing risk of loss or of stabilizing investment returns,        979          

engage in hedging transactions.                                    980          

      (B)  No administrator or executor may invest funds           982          

belonging to an estate in any asset other than a direct            983          

obligation of the United States that has a maturity date not       984          

exceeding one year from the date of such investment, or other      985          

than in a short-term investment fund that is invested exclusively  986          

in obligations of the United States or of its agencies, or         987          

primarily in such obligations and otherwise only in variable       988          

                                                          23     

                                                                 
demand notes, corporate money market instruments including, but    989          

not limited to, commercial paper, or fully collateralized          990          

repurchase agreements or other evidences of indebtedness that are  991          

payable on demand or generally have a maturity date not exceeding  992          

ninety-one days from the date of investment, except with the       993          

approval of the probate court or with the permission of the        994          

instruments creating the trust.                                    995          

      (C)(1)  In addition to the investments allowed by this       997          

section, a guardian or trustee, with the approval of the court,    998          

may invest funds belonging to the trust in productive real estate  999          

located within the state, provided that neither the guardian nor   1,000        

the trustee nor any member of the family of either has any         1,001        

interest in such real estate or in the proceeds of the purchase    1,002        

price.  The title to any real estate so purchased by a guardian    1,003        

must be taken in the name of the ward.                             1,004        

      (2)  Notwithstanding the provisions of division (C)(1) of    1,006        

this section, the court may permit the funds to be used to         1,007        

purchase or acquire a home for the ward or an interest in a home   1,008        

for the ward in which a member of the ward's family may have an    1,009        

interest.                                                          1,010        

      (D)  IF THE FIDUCIARY IS A TRUSTEE APPOINTED BY AND          1,012        

ACCOUNTABLE TO THE PROBATE COURT, THE FIDUCIARY SHALL INVEST THE   1,014        

TRUST'S ASSETS PURSUANT TO THE REQUIREMENTS AND STANDARDS SET                   

FORTH IN SECTIONS 1339.52 TO 1339.61 OF THE REVISED CODE.          1,015        

      Sec. 2109.371.  (A)  In addition to those investments made   1,024        

eligible by section 2109.37 or 2109.372 of the Revised Code,       1,025        

investments may be made by a fiduciary other than a guardian       1,026        

under sections 5905.01 to 5905.19 of the Revised Code, and         1,027        

subject to the restriction placed on an administrator or executor  1,028        

by division (B) of section 2109.37 of the Revised Code, in any of  1,029        

the following kinds and classes of securities, provided that it    1,030        

may be lawfully sold in Ohio and investment is made only in such   1,031        

securities as would be acquired by prudent persons of discretion   1,033        

and intelligence in such matters who are seeking a reasonable                   

                                                          24     

                                                                 
income and the preservation of their capital:                      1,034        

      (1)  Securities of corporations organized and existing       1,036        

under the laws of the United States, the District of Columbia, or  1,037        

any state of the United States including, but not limited to,      1,038        

bonds, debentures, notes, equipment trust obligations, or other    1,039        

evidences of indebtedness, and shares of common and preferred      1,040        

stocks of such corporations;                                       1,041        

      (2)  Subject to division (C) of this section, collective     1,043        

investment funds established in accordance with section 1111.14    1,044        

of the Revised Code or securities of any investment company,       1,045        

including any affiliated investment company, whether or not the    1,046        

fiduciary has invested other funds held by it in an agency or      1,047        

other nonfiduciary capacity in the securities of the same          1,048        

investment company or affiliated investment company;                            

      (3)  Bonds or other interest-bearing obligations of any      1,050        

state or territory of the United States, or of any county, city,   1,051        

village, school district, or other legally constituted political   1,052        

taxing subdivision of any state or territory of the United         1,053        

States, not otherwise eligible under division (A)(2) or (3) of     1,054        

section 2109.37 of the Revised Code.                               1,055        

      (B)  No investment shall be made pursuant to this section    1,057        

which, at the time such investment is made, causes the aggregate   1,058        

market value of the investments, not made eligible by section      1,059        

2109.37 or 2109.372 of the Revised Code, to exceed sixty per cent  1,060        

of the aggregate market value at that time of all the property of  1,061        

the fund held by the fiduciary.  No sale or other liquidation of   1,062        

any investment shall be required solely because of any change in   1,063        

the relative market value of those investments made eligible by    1,064        

this section and those made eligible by section 2109.37 or         1,065        

2109.372 of the Revised Code; provided that, in the event of a     1,066        

sale of investments authorized by this section, the proceeds from  1,067        

the sale may be reinvested in the kinds and classes of securities  1,068        

authorized by this section without regard to the percentage        1,069        

limitation provided in this division.  In determining the          1,070        

                                                          25     

                                                                 
aggregate market value of the property of a fund and the           1,071        

percentage of a fund to be invested under this section, a          1,072        

fiduciary may rely upon published market quotations as to those    1,073        

investments for which such quotations are available and upon such  1,074        

valuations of other investments as, in the fiduciary's best        1,075        

judgment, seem fair and reasonable according to available          1,076        

information.                                                                    

      (C)(1)(a)  A fiduciary making an investment of trust funds   1,079        

in securities of an affiliated investment company, or a bank       1,080        

subsidiary corporation or other corporation owned or controlled                 

by the bank holding company that owns or controls the fiduciary,   1,081        

may charge a reasonable fee for investment advisory, brokerage,    1,082        

transfer agency, registrar, management, or other similar services  1,083        

provided to an affiliated investment company.  The fee may be in   1,084        

addition to the compensation to which the fiduciary is otherwise   1,086        

entitled to receive from the trust, provided that the fee is                    

charged as a percentage of either asset value or income earned or  1,087        

actual amount charged and is disclosed at least annually by        1,088        

prospectus, account statement, or any other written means to all   1,089        

persons entitled to receive statements of account activity.        1,090        

      (b)  A fiduciary making an investment of trust funds in      1,092        

securities of an affiliated investment company pursuant to         1,093        

division (A)(2) of this section shall, when providing any          1,095        

periodic account statements to the trust fund, report the net                   

asset value of the shares comprising the investment of the trust   1,096        

funds in the affiliated investment company.                        1,097        

      (c)  If a fiduciary making an investment of trust funds in   1,099        

securities of an affiliated investment company pursuant to         1,100        

division (A)(2) of this section invests such funds in any mutual   1,102        

fund, the fiduciary shall disclose, in at least ten-point                       

boldface type, by prospectus, account statement, or any other      1,103        

written means to all persons entitled to receive statements of     1,104        

account activity, that the mutual fund is not insured or           1,105        

guaranteed by the federal deposit insurance corporation or by any  1,106        

                                                          26     

                                                                 
other government-sponsored agency of the federal government or of               

this state.                                                        1,107        

      (2)  Unless the investment of trust funds in securities of   1,109        

an affiliated investment company can be made under the terms of    1,110        

the instrument creating the trust, an exception to the investment  1,111        

of trust funds in securities of an affiliated investment company   1,112        

may be filed with the probate court.  Any exception filed          1,113        

pursuant to this division must be signed by all persons who                     

would, at the time the exception is filed, be permitted to file    1,114        

an exception to an account pursuant to section 2109.33 of the      1,116        

Revised Code and must state that all such persons request that     1,117        

the current investment of trust funds in securities of an          1,118        

affiliated investment company be terminated within a reasonable    1,119        

time.  If the probate court determines that the exception                       

complies with the requirements of this division, the probate       1,120        

court shall establish a schedule for disposing of any current      1,121        

investments in securities of an affiliated investment company,     1,122        

and the fiduciary shall cause the trust to dispose of the          1,123        

investments in accordance with the schedule.  The fiduciary shall  1,124        

not be liable for any loss incurred by the trust as a result of                 

complying with division (C)(2) of this section.                    1,125        

      (D)  As used in this section, "affiliated investment         1,127        

company," "investment company," and "reasonable fee" have the      1,128        

same meanings as in division (E) of section 1109.10 1111.13 of     1,129        

the Revised Code.                                                               

      Section 2.  That existing sections 1111.13, 1339.60,         1,131        

2109.37, and 2109.371 of the Revised Code are hereby repealed.     1,132        

      Section 3.  Section 2109.371 of the Revised Code is          1,134        

presented in this act as a composite of the section as amended by  1,135        

both Am. Sub. H.B. 538 and Sub. S.B. 129 of the 121st General      1,136        

Assembly, with the new language of neither of the acts shown in    1,138        

capital letters.  This is in recognition of the principle stated   1,139        

in division (B) of section 1.52 of the Revised Code that such      1,140        

amendments are to be harmonized where not substantively            1,141        

                                                          27     

                                                                 
irreconcilable and constitutes a legislative finding that such is  1,142        

the resulting version in effect prior to the effective date of     1,143        

this act.