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(127th General Assembly)
(Substitute House Bill Number 499)
AN ACT
To amend sections 2109.01, 5801.01, 5801.02, 5801.06,
5801.10, 5803.02, 5803.03, 5804.02, 5804.11,
5804.13, 5804.14, 5804.17, 5805.01, 5805.03,
5806.01, 5806.02, 5806.03, 5806.04, 5808.13,
5808.14, 5808.16, 5810.05, 5810.11, 5810.13, and
5815.35, to enact
section 5801.11, and to repeal
section 2109.022 of
the Revised Code to modify
the Ohio Trust Code and the Fiduciary Law.
Be it enacted by the General Assembly of the State of Ohio:
SECTION 1. That sections 2109.01, 5801.01, 5801.02, 5801.06,
5801.10, 5803.02, 5803.03, 5804.02, 5804.11, 5804.13, 5804.14,
5804.17, 5805.01, 5805.03, 5806.01, 5806.02, 5806.03, 5806.04,
5808.13, 5808.14, 5808.16, 5810.05, 5810.11, 5810.13, and 5815.35
be amended and
section 5801.11 of the Revised Code be enacted to
read as follows:
Sec. 2109.01. "Fiduciary," as used in Chapters 2101. to
2131. of the Revised
Code, except as provided in section 2109.022
of the Revised Code, means any
person, other than an assignee or
trustee for an insolvent debtor or a
guardian under sections
5905.01 to 5905.19 of the Revised Code, appointed by
and
accountable to the probate court and acting in a fiduciary
capacity for
any person, or charged with duties in relation to any
property, interest,
trust, or estate for the benefit of another;
and includes an agency under
contract with the department of
mental retardation and developmental
disabilities for the
provision of protective service under sections 5123.55 to
5123.59
of the Revised Code, appointed by and accountable to the probate
court
as
guardian or trustee with respect to mentally retarded or
developmentally
disabled persons.
Sec. 5801.01. As used in Chapters 5801. to 5811. of the
Revised Code:
(A) "Action," with respect to an act of a trustee, includes a
failure to act.
(B) "Ascertainable standard" means a standard relating to an
individual's health, education, support, or maintenance within the
meaning of section 2041(b)(1)(A) or 2514(c)(1) of the Internal
Revenue Code.
(C) "Beneficiary" means a person that has a present or future
beneficial interest in a trust, whether vested or contingent, or
that, in a capacity other than that of trustee, holds a power of
appointment over trust property, or a charitable organization that
is expressly designated in the terms of the trust to receive
distributions. "Beneficiary" does not include any charitable
organization that is not expressly designated in the terms of the
trust to receive distributions, but to whom the trustee may in its
discretion make distributions.
(D) "Beneficiary surrogate" means a person, other than a
trustee, designated by the settlor in the trust instrument to
receive notices, information, and reports otherwise required to be
provided to a current beneficiary under divisions (B)(8) and (9)
of section 5801.04 of the Revised Code.
(E) "Charitable trust" means a trust, or portion of a trust,
created for a charitable purpose described in division (A) of
section 5804.05 of the Revised Code.
(F) "Current beneficiary" means a beneficiary that, on the
date the beneficiary's qualification is determined, is a
distributee or permissible distributee of trust income or
principal.
(G) "Environmental law" means a federal, state, or local law,
rule, regulation, or ordinance relating to protection of the
environment.
(H) "Guardian of the estate" means a guardian appointed by a
court to administer the estate of any individual or to serve as
conservator of the property of an individual eighteen years of age
or older under section 2111.021 of the Revised Code.
(I) "Guardian of the person" means a guardian appointed by a
court to make decisions regarding the support, care, education,
health, and welfare of any individual or to serve as conservator
of the person of an individual eighteen years of age or older
under section 2111.021 of the Revised Code. "Guardian of the
person" does not include a guardian ad litem.
(J) "Internal Revenue Code" means the "Internal Revenue Code
of 1986," 100 Stat. 2085, 26 U.S.C. 1 et seq., as amended.
(K) "Interests of the beneficiaries" means the beneficial
interests provided in the terms of the trust.
(L) "Jurisdiction," with respect to a geographic area,
includes a state or country.
(M) "Mandatory distribution" means a distribution of income
or principal, including a distribution upon termination of the
trust, that the trustee is required to make to a beneficiary under
the terms of the trust. Mandatory distributions do not include
distributions that a trustee is directed or authorized to make
pursuant to a support or other standard, regardless of whether the
terms of the trust provide that the trustee "may" or "shall" make
the distributions pursuant to a support or other standard.
(N) "Person" means an individual, corporation, business
trust, estate, trust, partnership, limited liability company,
association, joint venture, government, governmental agency or
instrumentality, public corporation, or any other legal or
commercial entity.
(O) "Power of withdrawal" means a presently exercisable
general power of appointment other than a power exercisable by a
trustee that is limited by an ascertainable standard or that is
exercisable by another person only upon consent of the trustee or
a person holding an adverse interest.
(P) "Property" means anything or any interest in anything
that may be the subject of ownership.
(Q) "Qualified beneficiary" means a beneficiary to whom, on
the date the beneficiary's qualification is determined, any of the
following applies:
(1) The beneficiary is a distributee or permissible
distributee of trust income or principal.
(2) The beneficiary would be a distributee or permissible
distributee of trust income or principal if the interests of the
distributees described in division (Q)(1) of this section
terminated on that date, but the termination of those interests
would not cause the trust to terminate.
(3) The beneficiary would be a distributee or permissible
distributee of trust income or principal if the trust terminated
on that date.
(R) "Revocable," as applied to a trust, means revocable at
the time of determination by the settlor alone or by the settlor
with the consent of any person other than a person holding an
adverse interest. A trust's characterization as revocable is not
affected by the settlor's lack of capacity to exercise the power
of revocation, regardless of whether an agent of the settlor under
a power of attorney, or a guardian of the person or estate of the
settlor, is serving.
(S) "Settlor" means a person, including a testator, who
creates, or contributes property to, a trust. If more than one
person creates or contributes property to a trust, each person is
a settlor of the portion of the trust property attributable to
that person's contribution except to the extent another person has
the power to revoke or withdraw that portion.
(T) "Spendthrift provision" means a term of a trust that
restrains both voluntary and involuntary transfer of a
beneficiary's interest.
(U) "State" means a state of the United States, the District
of Columbia, the Commonwealth of Puerto Rico, a territory or
possession of the United States, or an Indian tribe or band
recognized by federal law or formally acknowledged by a state.
(V) "Terms of a trust" means the manifestation of the
settlor's intent regarding a trust's provisions as expressed in
the trust instrument or as may be established by other evidence
that would be admissible in a judicial proceeding.
(W) "Trust instrument" means an instrument executed by the
settlor that contains terms of the trust and any amendments to
that instrument.
(X) "Trustee" includes an original, additional, and successor
trustee and a cotrustee.
(Y)(1) "Wholly discretionary trust" means a trust to which
all of the following apply:
(a) The trust is irrevocable.
(b) Distributions of income or principal from the trust may
or shall be made to or for the benefit of the beneficiary only at
the trustee's discretion.
(c) The beneficiary does not have a power of withdrawal from
the trust.
(d) The terms of the trust use "sole," "absolute,"
"uncontrolled," or language of similar import to describe the
trustee's discretion to make distributions to or for the benefit
of the beneficiary.
(e) The terms of the trust do not provide any standards to
guide the trustee in exercising its discretion to make
distributions to or for the benefit of the beneficiary.
(f) The beneficiary is not the settlor, the trustee, or a
cotrustee.
(g) The beneficiary does not have the power to become the
trustee or a cotrustee.
(2) A trust may be a wholly discretionary trust with respect
to one or more but less than all beneficiaries.
(3) If a beneficiary has a power of withdrawal, the trust may
be a wholly discretionary trust with respect to that beneficiary
during any period in which the beneficiary may not exercise the
power. During a period in which the beneficiary may exercise the
power, both of the following apply:
(a) The portion of the trust the beneficiary may withdraw may
not be a wholly discretionary trust with respect to that
beneficiary;
(b) The portion of the trust the beneficiary may not withdraw
may be a wholly discretionary trust with respect to that
beneficiary.
(4) If the beneficiary and one or more others have made
contributions to the trust, the portion of the trust attributable
to the beneficiary's contributions may not be a wholly
discretionary trust with respect to that beneficiary, but the
portion of the trust attributable to the contributions of others
may be a wholly discretionary trust with respect to that
beneficiary. If a beneficiary has a power of withdrawal, then upon
the lapse, release, or waiver of the power, the beneficiary is
treated as having made contributions to the trust only to the
extent the value of the property affected by the lapse, release,
or waiver exceeds the greatest of the following amounts:
(a) The amount specified in section 2041(b)(2) or 2514(e) of
the Internal Revenue Code;
(b) If the donor of the property subject to the beneficiary's
power of withdrawal is not married at the time of the transfer of
the property to the trust, the amount specified in section 2503(b)
of the Internal Revenue Code;
(c) If the donor of the property subject to the beneficiary's
power of withdrawal is married at the time of the transfer of the
property to the trust, twice the amount specified in section
2503(b) of the Internal Revenue Code.
(5) Notwithstanding divisions (Y)(1)(f) and (g) of this
section, a trust may be a wholly discretionary trust if the
beneficiary is, or has the power to become, a trustee only with
respect to the management or the investment of the trust assets,
and not with respect to making discretionary distribution
decisions. With respect to a trust established for the benefit of
an individual who is blind or disabled as defined in 42 U.S.C.
1382c(a)(2) or (3), as amended, a wholly discretionary trust may
include either or both of the following:
(a) Precatory language regarding its intended purpose of
providing supplemental goods and services to or for the benefit of
the beneficiary, and not to supplant benefits from public
assistance programs;
(b) A prohibition against providing food, clothing, and
shelter to the beneficiary.
Sec. 5801.02. Except as otherwise provided in any provision
of Chapters 5801. to 5811. of the Revised Code, those chapters
apply to charitable and noncharitable inter vivos express trusts
and to trusts created pursuant to a statute, judgment, or decree
that requires the trust to be administered in the manner of an
express trust. Chapters 5801. to 5811. of the Revised Code apply
to charitable and noncharitable testamentary trusts to the extent
provided by section 2109.69 of the Revised Code.
Sec. 5801.06. (A) The law of the jurisdiction designated in
the terms of a trust determines the meaning and effect of the
terms unless the designation of that jurisdiction's law is
contrary to a strong public policy of the jurisdiction having the
most significant relationship to the matter at issue. In the
absence of a controlling designation in the terms of the trust,
the law of the jurisdiction having the most significant
relationship to the matter at issue determines the meaning and
effect of the terms.
(B) The administration of a trust is governed by the law
designated in the terms of the trust to govern trust
administration. If the terms of the trust do not designate the
governing law, both of the following apply:
(1) The law of the trust's principal place of administration
governs the administration of the trust.
(2) If the trust's principal place of administration is
transferred to another jurisdiction under section 5801.07 of the
Revised Code, the law of the new principal place of administration
of the trust governs the administration of the trust from the time
of the transfer.
Sec. 5801.10. (A) As used in this section, "creditor" means
any of the following:
(1) A person holding a debt or security for a debt entered
into by a trustee on behalf of the trust;
(2) A person holding a debt secured by one or more assets of
the trust;
(3) A person having a claim against the trustee or the assets
of the trust under section 5805.06 of the Revised Code;
(4) A person who has attached through legal process a
beneficiary's interest in the trust.
(B) The parties to an agreement under this section shall be
all of the following, or their representatives under the
representation provisions of Chapter 5803. of the Revised Code,
except that only the settlor and any trustee are required to be
parties to an amendment of any revocable trust:
(1) The settlor if living and if no adverse income or
transfer tax results would arise from the settlor's participation;
(2) All beneficiaries;
(3) All currently serving trustees;
(4) Creditors, if their interest is to be affected by the
agreement.
(C) The persons specified in division (B) of this section may
by written instrument enter into an agreement with respect to any
matter concerning the construction of, administration of, or
distributions under the terms of the trust instrument, the
investment of income or principal held by the trustee, or other
matters. The agreement is valid only to the extent that it does
may not effect a termination of the trust before the date
specified for the trust's termination in the terms of the trust
instrument, does not change the interests of the beneficiaries in
the trust except as necessary to effect a modification described
in division (C)(5) or (6) of this section, and includes or include
terms and conditions that could not be properly approved by the
court under Chapters 5801. to 5811. of the Revised Code or other
applicable law. The invalidity of any provision of the agreement
does not affect the validity of other provisions of the agreement.
Matters that may be resolved by a private settlement agreement
include, but are not limited to, all of the following:
(1) Determining classes of creditors, beneficiaries, heirs,
next of kin, or other persons;
(2) Resolving disputes arising out of the administration or
distribution under the terms of the trust instrument, including
disputes over the construction of the language of the trust
instrument or construction of the language of other writings that
affect the terms of the trust instrument;
(3) Granting to the trustee necessary or desirable powers not
granted in the terms of the trust instrument or otherwise provided
by law, to the extent that those powers either are not
inconsistent with the express provisions or purposes of the terms
of the trust instrument or, if inconsistent with the express
provisions or purposes of the terms of the trust instrument, are
necessary for the due administration of the terms of the trust
instrument;
(4) Modifying the terms of the trust instrument, if the
modification is not inconsistent with any dominant purpose or
objective of the trust;
(5) Modifying the terms of the trust instrument in the manner
required to qualify the gift under the terms of the trust
instrument for the charitable estate or gift tax deduction
permitted by federal law, including the addition of mandatory
governing instrument requirements for a charitable remainder trust
as required by the Internal Revenue Code and regulations
promulgated under it in any case in which all parties interested
in the trust have submitted written agreements to the proposed
changes or written disclaimer of interest;
(6) Modifying the terms of the trust instrument in the manner
required to qualify any gift under the terms of the trust
instrument for the estate tax marital deduction available to
noncitizen spouses, including the addition of mandatory governing
instrument requirements for a qualified domestic trust under
section 2056A of the Internal Revenue Code and regulations
promulgated under it in any case in which all parties interested
in the trust have submitted written agreements to the proposed
changes or written disclaimer of interest;
(7) Resolving any other matter that arises under Chapters
5801. to 5811. of the Revised Code.
(D) No agreement shall be entered into under this section
affecting the rights of a creditor without the creditor's consent
or affecting the collection rights of federal, state, or local
taxing authorities.
(E) Any agreement entered into under this section that
complies with the requirements of division (C) of this section
shall be final and binding on the trustee, the settlor if living,
all beneficiaries, creditors who are parties to the agreement,
and their heirs, successors, and assigns.
(F) Notwithstanding anything in this section, in division (D)
of section 5803.03 of the Revised Code, or in any other rule of
law to the contrary, a trustee serving under the terms of the
trust instrument shall only represent its own individual or
corporate interests in negotiating or entering into an agreement
subject to this section. No trustee serving under the terms of the
trust instrument shall be considered to represent any settlor,
beneficiary, or the interests of any settlor or beneficiary in
negotiating or entering into an agreement subject to this section.
(G) Any party to a private settlement agreement entered into
under this section may request the court to approve the agreement,
to determine whether the representation as provided in Chapter
5803. of the Revised Code was adequate, and to determine whether
the agreement contains terms and conditions the court could have
properly approved.
(H) If an agreement entered into under this section contains
a provision requiring binding arbitration of any disputes arising
under the agreement, the provision is enforceable.
(I) Nothing in this section affects any of the following:
(1) The right of a beneficiary to disclaim under section
5815.36 of the Revised Code;
(2) The termination or modification of a trust under section
5804.10, 5804.11, 5804.12, 5804.13, 5804.14, 5804.15, or 5804.16
of the Revised Code;
(3) The ability of a trustee to divide or consolidate a trust
under section 5804.17 of the Revised Code.
(J) Nothing in this section restricts or limits the
jurisdiction of any court to dispose of matters not covered by
agreements under this section or to supervise the acts of trustees
appointed by that court.
(K) This section shall be liberally construed to favor the
validity and enforceability of agreements entered into under it.
(L) A trustee serving under the trust instrument is not
liable to any third person arising from any loss due to that
trustee's actions or inactions taken or omitted in good faith
reliance on the terms of an agreement entered into under this
section.
(M) This section does not apply to any of the following:
(1) A charitable trust that has one or more charitable
organizations as qualified beneficiaries;
(2) A charitable trust the terms of which authorize or direct
the trustee to distribute trust income or principal to one or more
charitable organizations to be selected by the trustee, or for one
or more charitable purposes described in division (A) of section
5804.05 of the Revised Code, if any of the following apply:
(a) The distributions may be made on the date that an
agreement under this section would be entered into.
(b) The distributions could be made on the date that an
agreement under this section would be entered into if the
interests of the current beneficiaries of the trust terminated on
that date, but the termination of those interests would not cause
the trust to terminate.
(c) The distributions could be made on the date that an
agreement under this section would be entered into if the trust
terminated on that date.
Sec. 5801.11. A guardian of the estate or person, in acting
under Chapters 5801. to 5811. of the Revised Code, shall comply
with the guardian's duties under Chapter 2111. of the Revised Code
or other applicable law.
Sec. 5803.02. To the extent there is no conflict of interest
between the holder of a general testamentary power of appointment
and the persons represented with respect to the particular
question or dispute, the holder may represent and bind persons
whose interests, as permissible appointees, takers in default, or
otherwise, are subject to the power. The rights of the holder of a
presently exercisable general power of appointment are governed by
section 5806.03 of the Revised Code.
Sec. 5803.03. To the extent there is no conflict of interest
between the representative and the person represented or among
those being represented with respect to a particular question or
dispute, all of the following apply:
(A) A guardian of the estate may represent and bind the
estate that the guardian of the estate controls.
(B) A guardian of the person may represent and bind the ward
if a guardian of the estate has not been appointed.
(C) An agent having authority to act with respect to the
particular question or dispute may represent and bind the
principal.
(D) Except as provided in division (F) of section 5801.10 of
the Revised Code, a trustee may represent and bind the
beneficiaries of the trust.
(E) A personal representative of a decedent's estate may
represent and bind persons interested in the estate.
(F) A parent may represent and bind the parent's minor or
unborn child if neither a guardian for the child's estate or a
guardian of the person has been appointed. If a minor or unborn
child is not represented by a parent under this division, another
person may represent and bind the minor or unborn child under
section 5803.04 of the Revised Code if the requirements of that
section are met.
Sec. 5804.02. (A) A trust is created only if all of the
following apply:
(1) The settlor of the trust, other than the settlor of a
trust created by a court order, has capacity to create a trust.
(2) The settlor of the trust, other than the settlor of a
trust created by a court order, indicates an intention to create
the trust.
(3) The trust has a definite beneficiary or is one of the
following:
(a) A charitable trust;
(b) A trust for the care of an animal, as provided in section
5804.08 of the Revised Code;
(c) A trust for a noncharitable purpose, as provided in
section 5804.09 of the Revised Code.
(4) The trustee has duties to perform.
(5) The same person is not the sole trustee and sole
beneficiary.
(B) A beneficiary is definite if the beneficiary can be
ascertained now or in the future, subject to any applicable rule
against perpetuities.
(C) A power in a trustee or other person to select a
beneficiary from an indefinite class is valid. If the power is not
exercised within a reasonable time, the power fails, and the
property subject to the power passes to the persons who would have
taken the property had the power not been conferred.
(D) A trust is valid regardless of the existence, size, or
character of the corpus of the trust. This division applies to any
trust instrument that was executed prior to, or is executed on or
after, the effective date of Chapters 5801. to 5811. of the
Revised Code January 1, 2007.
(E) A trust is not invalid because a person, including, but
not limited to, the creator of the trust, is or may become the
sole trustee and the sole holder of the present beneficial
enjoyment of the corpus of the trust, provided that one or more
other persons hold a vested, contingent, or expectant interest
relative to the enjoyment of the corpus of the trust upon the
cessation of the present beneficial enjoyment. A merger of the
legal and equitable titles to the corpus of a trust described in
this division does not occur in its creator, and, notwithstanding
any contrary provision of Chapter 2107. of the Revised Code, the
trust is not a testamentary trust that is required to comply with
that chapter in order for its corpus to be legally distributed to
other beneficiaries in accordance with the provisions of the trust
upon the cessation of the present beneficial enjoyment. This
division applies to any trust that satisfies the provisions of
this division, whether the trust was executed prior to, on, or
after October 10, 1991.
Sec. 5804.11. (A) If upon petition the court finds that the
settlor and all beneficiaries consent to the modification or
termination of a noncharitable irrevocable trust, that all
consents, including any given by representatives under Chapter
5803. of the Revised Code, are valid, and that all parties giving
consent are competent to do so, the
court shall enter an
order
approving the modification or
termination even if the
modification or termination is
inconsistent with a material
purpose of the trust. An agent under
a power of attorney may
exercise a settlor's power to consent to a
trust's modification
or termination only to the extent expressly
authorized by both
the power of attorney and the terms of the
trust. The settlor's
guardian of the estate may exercise a
settlor's power to consent
to a trust's modification or
termination with the approval of the
court supervising the
guardianship if an agent is not so
authorized. The guardian of the
settlor's person may exercise a
settlor's power to consent to a
trust's modification or
termination with the approval of the court
supervising the
guardianship if an agent is not so authorized and
a guardian of
the estate has not been appointed. This division
applies only to
irrevocable trusts created on or after the
effective date of
Chapters 5801. to 5811. of the Revised Code and
to revocable
trusts that become irrevocable on or after the
effective date of
Chapters 5801. to 5811. of the Revised Code.
This division does
not apply to a noncharitable irrevocable trust
described in 42
U.S.C. 1396p(d)(4).
(B) A noncharitable irrevocable trust may be terminated upon
consent of all of the beneficiaries if the court concludes that
continuance of the trust is not necessary to achieve any material
purpose of the trust. A noncharitable irrevocable trust may be
modified, but not to remove or replace the trustee, upon consent
of all of the beneficiaries if the court concludes that
modification is not inconsistent with a material purpose of the
trust. A spendthrift provision in the terms of the trust may, but
is not presumed to, constitute a material purpose of the trust.
(C) Upon termination of a trust under division (A) or (B) of
this section, the trustee shall distribute the trust property as
agreed by the beneficiaries.
(D) If not all of the beneficiaries consent to a proposed
modification or termination of the trust under division (A) or (B)
of this section, the court may approve the modification or
termination if the court is satisfied of both of the following:
(1) That if all of the beneficiaries had consented, the trust
could have been modified or terminated under this section;
(2) That the interests of a beneficiary who does not consent
will be adequately protected.
Sec. 5804.13. (A) Except as otherwise provided in division
(B) of this section, if a particular charitable purpose becomes
unlawful, impracticable, or impossible to achieve, all of the
following apply:
(1) The trust does not fail in whole or in part.
(2) The trust property does not revert to the settlor or the
settlor's successors in interest.
(3) The court may apply cy pres to modify or terminate the
trust by directing that the trust property be applied or
distributed, in whole or in part, in a manner consistent with the
settlor's charitable purposes. In accordance with section 109.25
of the Revised Code, the attorney general is a necessary party to
a judicial proceeding brought under this section.
(B) A provision in the terms of a charitable trust for an
alternative charitable purpose or for the distribution of the
trust property to a noncharitable beneficiary prevails over the
power of the court under division (A) of this section to apply cy
pres to modify or terminate the trust.
Sec. 5804.14. (A)(1) Except as provided in division (A)(2)
of this section, after notice to the qualified beneficiaries, the
trustee of an inter vivos trust consisting of trust property
having a total value of less than one hundred thousand dollars may
terminate the trust if the trustee concludes that the value of the
trust property is insufficient to justify the cost of
administration.
(2) Division (A)(1) of this section does not apply to any of
the following:
(a) A charitable trust that has one or more charitable
organizations as qualified beneficiaries;
(b) A charitable trust the terms of which authorize or direct
the trustee to distribute trust income or principal to one or more
charitable organizations to be selected by the trustee, or for one
or more charitable purposes described in division (A) of section
5804.05 of the Revised Code, if any of the following apply:
(i) The distributions may be made on the date that the trust
would be terminated under division (A)(1) of this section.
(ii) The distributions could be made on the date that the
trust would be terminated under division (A)(1) of this section if
the interests of the current beneficiaries of the trust terminated
on that date, but the termination of those interests would not
cause the trust to terminate.
(iii) The distributions could be made on the date that the
trust would be terminated under division (A)(1) of this section,
if the trust terminated on that date but not under that division.
(B) If an inter vivos trust consists of trust property having
a total value of less than one hundred thousand dollars, the court
may modify or terminate the trust or remove the trustee and
appoint a different trustee if it determines that the value of the
trust property is insufficient to justify the cost of
administration.
(C) Upon the termination of a trust pursuant to division
(A)(1) of this section, the trustee shall distribute the trust
estate in accordance with any provision specified in the terms of
the trust instrument for the premature termination of the trust.
If there is no provision of that nature in the terms of the trust
instrument, the trustee shall distribute the trust estate among
the beneficiaries of the trust in accordance with their respective
beneficial interests and in a manner that the trustee determines
to be equitable. For purposes of distributing the trust estate
among the beneficiaries of the trust under this division, the
trustee shall consider all of the following:
(1) The existence of any agreement among the beneficiaries
with respect to their beneficial interests;
(2) The actuarial values of the separate beneficial interests
of the beneficiaries;
(3) Any expression of preference of the beneficiaries that is
contained in the terms of the trust instrument.
(D) Upon the termination of a trust pursuant to division (B)
of this section, the probate court shall order the distribution of
the trust estate in accordance with any provision specified in the
terms of the trust instrument for the premature termination of the
trust. If there is no provision of that nature in the terms of the
trust instrument, the probate court shall order the distribution
of the trust estate among the beneficiaries of the trust in
accordance with their respective beneficial interests and in a
manner that the court determines to be equitable. For purposes of
ordering the distribution of the trust estate among the
beneficiaries of the trust under this division, the court shall
consider the three factors listed in division (C) of this section.
(E) The existence of a spendthrift or similar provision in
the terms of a trust instrument or will does not preclude the
termination of a trust pursuant to this section.
(F) This section does not apply to an easement for
conservation or preservation.
Sec. 5804.17. After notice to the qualified beneficiaries, a
trustee may combine two or more trusts into a single trust or
divide a trust into two or more separate trusts if the result does
not substantially impair the rights of any beneficiary or
adversely affect have a materially adverse effect on the
achievement of the purposes of the trust.
Sec. 5805.01. (A) A spendthrift provision is valid only if
it restrains both voluntary and involuntary transfer of a
beneficiary's interest or if it restrains involuntary transfer of
a beneficiary's interest and permits voluntary transfer of a
beneficiary's interest only with the consent of a trustee who is
not the beneficiary.
(B) A term of a trust providing that the interest of a
beneficiary is held subject to a "spendthrift trust," or words of
similar import, is sufficient to restrain both voluntary and
involuntary transfer of the beneficiary's interest.
(C) A beneficiary may not transfer an interest in a trust in
violation of a valid spendthrift provision and, except as
otherwise provided in this chapter and in section 5810.04 of the
Revised Code, a creditor or assignee of the beneficiary may not
reach the interest or a distribution by the trustee before its
receipt by the beneficiary. Real property or tangible personal
property that is owned by the trust but that is made available for
a beneficiary's use or occupancy in accordance with the trustee's
authority under the terms of the trust instrument shall not be
considered to have been distributed by the trustee or received by
the beneficiary for purposes of allowing a creditor or assignee of
the beneficiary to reach the property.
Sec. 5805.03. Notwithstanding anything to the contrary in
division (B) of section 5805.02 of the Revised Code, no creditor
or assignee of a beneficiary of a wholly discretionary trust may
reach the beneficiary's interest in the trust, or a distribution
by the trustee before its receipt by the beneficiary, whether by
attachment of present or future distributions to or for the
benefit of the beneficiary, by judicial sale, by obtaining an
order compelling the trustee to make distributions from the trust,
or by any other means, regardless of whether the terms of the
trust instrument includes include a spendthrift provision.
Sec. 5806.01. The capacity of a settlor required to create,
amend, revoke, or add property to a revocable trust, or to direct
the actions of the trustee of a revocable trust, is the same as
that required to make a will.
Sec. 5806.02. (A) Unless the terms of a trust expressly
provide that the trust is irrevocable, the settlor may revoke or
amend the trust. This division does not apply to a trust created
under an instrument executed before the effective date of this
section January 1, 2007.
(B) If a revocable trust is created or funded by more than
one settlor, all of the following apply:
(1) To the extent the trust consists of community property,
either spouse acting alone may revoke the trust, but the trust may
be amended only by joint action of both spouses.
(2) To the extent the trust consists of property other than
community property, each settlor may revoke or amend the trust
with regard to the portion of the trust property attributable to
that settlor's contribution.
(3) Upon the revocation or amendment of the trust by less
than all of the settlors, the trustee shall promptly notify the
other settlors of the revocation or amendment.
(C) The settlor may revoke or amend a revocable trust by
substantial compliance with a method provided in the terms of the
trust or, if the terms of the trust do not provide a method, by
any other method manifesting clear and convincing evidence of the
settlor's intent, provided that a revocable trust may not be
revoked or amended by a will or codicil, regardless of whether it
refers to the trust or specifically devises property that would
otherwise have passed according to the terms of the trust unless
the terms of the trust expressly allow it to be revoked or amended
by a will or codicil.
(D) Upon revocation of a revocable trust, the trustee shall
deliver the trust property as the settlor directs.
(E) An agent under a power of attorney may exercise a
settlor's powers with respect to revocation, amendment, or
distribution of trust property only to the extent expressly
authorized by both the terms of the trust and the power.
(F) A guardian of the estate of the settlor or, if no
guardian of the estate has been appointed, a guardian of the
person of the settlor may exercise a settlor's powers with respect
to revocation, amendment, or distribution of trust property only
with the approval of the court supervising the guardianship.
(G) A trustee who does not know that a trust has been revoked
or amended is not liable to the settlor or settlor's successors in
interest for distributions made and other actions taken on the
assumption that the trust had not been amended or revoked.
Sec. 5806.03. (A) During the lifetime of the settlor of a
revocable trust, whether or not the settlor has capacity to revoke
the trust, the rights of the beneficiaries are subject to the
control of the settlor, and the duties of the trustee, including
the duties to inform and report under section 5808.13 of the
Revised Code, are owed exclusively to, the settlor. If the trustee
breaches its duty during the lifetime of the settlor, any recovery
obtained from the trustee after the settlor becomes incapacitated
or dies shall be apportioned by the court. If the settlor is
living when the recovery is obtained, the court shall apportion
the recovery between the settlor and the trust, or allocate the
entire recovery to the settlor or the trust, as it determines to
be equitable under the circumstances. If the settlor is not living
when the recovery is obtained, the court shall apportion the
recovery between the settlor's estate and the trust, or allocate
the entire recovery to the settlor's estate or the trust, as it
determines to be equitable under the circumstances.
(B) During the period the power may be exercised, the holder
of a power of withdrawal has the rights of a settlor of a
revocable trust under this section to the extent of the property
subject to the power.
Sec. 5806.04. (A) Any of the following actions pertaining
to
a revocable trust that is made irrevocable by the death of the
settlor of the trust shall be commenced within by the earlier of
the date that is two years after the
date of the death of the
settlor of the trust or that is six months from the date on which
the trustee sends the person bringing the action a copy of the
trust instrument and a notice informing the person of the trust's
existence, of the trustee's name and address, and of the time
allowed under this division for commencing an action:
(1) An action to contest the validity of the trust;
(2) An action to contest the validity of any amendment to
the
trust that was made during the lifetime of the settlor of the
trust;
(3) An action to contest the revocation of the trust during
the lifetime of the settlor of the trust;
(4) An action to contest the validity of any transfer made
to
the trust during the lifetime of the settlor of the trust.
(B) Upon the death of the settlor of a revocable trust that
was made irrevocable by the death of the settlor, the trustee,
without liability, may proceed to distribute the trust property in
accordance with the terms of the trust unless either of the
following applies:
(1) The trustee has actual knowledge of a pending action to
contest the validity of the trust, any amendment to the trust, the
revocation of the trust, or any transfer made to the trust during
the lifetime of the settlor of the trust.
(2) The trustee receives written notification from a
potential contestant of a potential action to contest the validity
of the trust, any amendment to the trust, the revocation of the
trust, or any transfer made to the trust during the lifetime of
the settlor of the trust, and the action is actually filed within
ninety days after the written notification was given to the
trustee.
(C) If a distribution of trust property is made pursuant to
division (B) of this section, a beneficiary of the trust shall
return any distribution to the extent that it exceeds the
distribution to which the beneficiary is entitled if the trust, an
amendment to the trust, or a transfer made to the trust later is
determined to be invalid.
(D) This section applies only to revocable trusts that are
made irrevocable by the death of the settlor of the trust if the
grantor dies on or after
July 23, 2002.
Sec. 5808.13. (A) A trustee shall keep the current
beneficiaries of the trust reasonably informed about the
administration of the trust and of the material facts necessary
for them to protect their interests. Unless unreasonable under the
circumstances, a trustee shall promptly respond to a beneficiary's
request for information related to the administration of the
trust.
(B) A trustee shall do all of the following:
(1) Upon the request of a beneficiary, promptly furnish to
the beneficiary a copy of the trust instrument. Unless the
beneficiary expressly requests a copy of the entire trust
instrument, the trustee may furnish to the beneficiary a copy of a
redacted trust instrument that includes only those provisions of
the trust instrument that the trustee determines are relevant to
the beneficiary's interest in the trust. If the beneficiary
requests a copy of the entire trust instrument after receiving a
copy of a redacted trust instrument, the trustee shall furnish a
copy of the entire trust instrument to the beneficiary. If the
settlor of a revocable trust that has become irrevocable has
completely restated the terms of the trust, the trust instrument
furnished by the trustee shall be the restated trust instrument,
including any amendments to the restated trust instrument. Nothing
in division (B)(1) of this section limits the ability of a
beneficiary to obtain a copy of the original trust instrument, any
other restatements of the original trust instrument, or amendments
to the original trust instrument and any other restatements of the
original trust instrument in a judicial proceeding with respect to
the trust.
(2) Within sixty days after accepting a trusteeship, notify
the current beneficiaries of the acceptance and of the trustee's
name, address, and telephone number;
(3) Within sixty days after the date the trustee acquires
knowledge of the creation of an irrevocable trust, or the date the
trustee acquires knowledge that a formerly revocable trust has
become irrevocable, whether by the death of the settlor or
otherwise, notify the current beneficiaries of the trust's
existence, of the identity of the settlor or settlors, of the
right to request a copy of the trust instrument, and of the right
to a trustee's report as provided in division (C) of this section;
(4) Notify the current beneficiaries in advance of any change
in the method or rate of the trustee's compensation.
(C) A trustee of a trust that has a fiscal year ending on or
after January 1, 2007, shall send to the current beneficiaries,
and to other beneficiaries who request it, at least annually and
at the termination of the trust, a report of the trust property,
liabilities, receipts, and disbursements, including the source and
amount of the trustee's compensation, a listing of the trust
assets, and, if feasible, the trust assets' respective market
values. Upon a vacancy in a trusteeship, unless a cotrustee
remains in office, a report for the period during which the former
trustee served must be sent to the current beneficiaries by the
former trustee. A personal representative or guardian may send the
current beneficiaries a report on behalf of a deceased or
incapacitated trustee.
(D) A beneficiary may waive the right to a trustee's report
or other information otherwise required to be furnished under this
section. A beneficiary, with respect to future reports and other
information, may withdraw a waiver previously given.
(E) The trustee may provide information and reports to
beneficiaries to whom the provided information and reports are not
required to be provided under this section.
(F) Divisions (B)(2) and (3) of this section apply only to a
trustee who accepts a trusteeship on or after the effective date
of this section January 1, 2007, to an irrevocable trust created
on or after the effective date of this section January 1, 2007,
and to a revocable trust that becomes irrevocable on or after the
effective date of this section January 1, 2007.
(G) During the lifetime of the settlor of a revocable trust,
whether or not the settlor has capacity to revoke the trust, the
trustee's duties under this section are owed exclusively to the
settlor.
Sec. 5808.14. (A) The judicial standard of review for
discretionary trusts is that the trustee shall exercise a
discretionary power reasonably, in good faith, and in accordance
with the terms and purposes of the trust and the interests of the
beneficiaries, except that with respect to distribution decisions
a reasonableness standard shall not be applied to the exercise of
discretion by the trustee of a wholly discretionary trust. The
greater the grant of discretion by the settlor to the trustee, the
broader the range of permissible conduct by the trustee in
exercising it.
(B) Subject to division (D) of this section, and unless the
terms of the trust expressly indicate that a rule in this division
does not apply:
(1) A person other than a settlor who is a beneficiary and
trustee of a trust that confers on the trustee a power to make
discretionary distributions to or for the trustee's personal
benefit may exercise the power only in accordance with an
ascertainable standard.
(2) A trustee may not exercise a power to make discretionary
distributions to satisfy a legal obligation of support that the
trustee personally owes another person.
(C) A power whose exercise is limited or prohibited by
division (B) of this section may be exercised by a majority of the
remaining trustees whose exercise of the power is not so limited
or prohibited. If the power of all trustees is so limited or
prohibited, the court may appoint a special fiduciary with
authority to exercise the power.
(D) Division (B) of this section does not apply to any of the
following:
(1) A power held by the settlor's spouse who is the trustee
of a trust for which a marital deduction, as defined in section
2056(b)(5) or 2523(e) of the Internal Revenue Code, was previously
allowed;
(2) Any trust during any period that the trust may be revoked
or amended by its settlor;
(3) A trust if contributions to the trust qualify for the
annual exclusion under section 2503(c) of the Internal Revenue
Code.
Sec. 5808.16. Without limiting the authority conferred by
section 5808.15 of the Revised Code, a trustee may do all of the
following:
(A) Collect trust property and accept or reject additions to
the trust property from a settlor or any other person;
(B) Acquire or sell property, for cash or on credit, at
public or private sale;
(C) Exchange, partition, or otherwise change the character of
trust property;
(D) Deposit trust money in an account in a regulated
financial-service institution;
(E) Borrow money, with or without security, and mortgage or
pledge trust property for a period within or extending beyond the
duration of the trust;
(F) With respect to an interest in a proprietorship,
partnership, limited liability company, business trust,
corporation, or other form of business or enterprise, continue the
business or other enterprise and take any action that may be taken
by shareholders, members, or property owners, including merging,
dissolving, or otherwise changing the form of business
organization or contributing additional capital;
(G) With respect to stocks or other securities, exercise the
rights of an absolute owner, including the right to do any of the
following:
(1) Vote, or give proxies to vote, with or without power of
substitution, or enter into or continue a voting trust agreement;
(2) Hold a security in the name of a nominee or in other form
without disclosure of the trust so that title may pass by
delivery;
(3) Pay calls, assessments, and other sums chargeable or
accruing against the securities and sell or exercise stock
subscription or conversion rights;
(4) Deposit the securities with a depositary or other
regulated financial-service institution.
(H) With respect to an interest in real property, construct,
or make ordinary or extraordinary repairs to, alterations to, or
improvements in, buildings or other structures, demolish
improvements, raze existing or erect new party walls or buildings,
subdivide or develop land, dedicate land to public use or grant
public or private easements, and make or vacate plats and adjust
boundaries;
(I) Enter into a lease for any purpose as lessor or lessee,
including a lease or other arrangement for exploration and removal
of natural resources, with or without the option to purchase or
renew, for a period within or extending beyond the duration of the
trust;
(J) Grant an option involving a sale, lease, or other
disposition of trust property or acquire an option for the
acquisition of property, including an option exercisable beyond
the duration of the trust, and exercise an option so acquired;
(K) Insure the property of the trust against damage or loss
and insure the trustee, the trustee's agents, and beneficiaries
against liability arising from the administration of the trust;
(L) Abandon or decline to administer property of no value or
of insufficient value to justify its collection or continued
administration;
(M) With respect to possible liability for violation of
environmental law, do any of the following:
(1) Inspect or investigate property the trustee holds or has
been asked to hold, or property owned or operated by an
organization in which the trustee holds or has been asked to hold
an interest, for the purpose of determining the application of
environmental law with respect to the property;
(2) Take action to prevent, abate, or otherwise remedy any
actual or potential violation of any environmental law affecting
property held directly or indirectly by the trustee, whether taken
before or after the assertion of a claim or the initiation of
governmental enforcement;
(3) Decline to accept property into trust or disclaim any
power with respect to property that is or may be burdened with
liability for violation of environmental law;
(4) Compromise claims against the trust that may be asserted
for an alleged violation of environmental law;
(5) Pay the expense of any inspection, review, abatement, or
remedial action to comply with environmental law.
(N) Pay or contest any claim, settle a claim by or against
the trust, and release, in whole or in part, a claim belonging to
the trust;
(O) Pay taxes, assessments, compensation of the trustee and
of employees and agents of the trust, and other expenses incurred
in the administration of the trust;
(P) Exercise elections with respect to federal, state, and
local taxes;
(Q) Select a mode of payment under any employee benefit or
retirement plan, annuity, or life insurance policy payable to the
trustee, exercise rights under any employee benefit or retirement
plan, annuity, or life insurance policy payable to the trustee,
including the right to indemnification for expenses and against
liabilities, and take appropriate action to collect the proceeds;
(R) Make loans out of trust property, including loans to a
beneficiary on terms and conditions the trustee considers to be
fair and reasonable under the circumstances, and the trustee has a
lien on future distributions for repayment of those loans;
(S) Pledge the property of a revocable trust to guarantee
Guarantee loans made by others to the settlor of the a revocable
trust, or and, if the settlor so directs, to guarantee loans made
by others to a third party and mortgage, pledge, or grant a
security interest in the property of a revocable trust to secure
the payment of loans made by others to the settlor of the
revocable trust and, if the settlor so directs, loans made by
others to a third party;
(T) Appoint a trustee to act in another jurisdiction with
respect to trust property located in the other jurisdiction,
confer upon the appointed trustee all of the powers and duties of
the appointing trustee, require that the appointed trustee furnish
security, and remove any trustee so appointed;
(U) Pay an amount distributable to a beneficiary who is under
a legal disability or who the trustee reasonably believes is
incapacitated, by paying it directly to the beneficiary or
applying it for the beneficiary's benefit, or by doing any of the
following:
(1) Paying it to the beneficiary's guardian of the estate,
or, if the beneficiary does not have a guardian of the estate, the
beneficiary's guardian of the person;
(2) Paying it to the beneficiary's custodian under sections
5814.01 to 5814.09 of the Revised Code and, for that purpose,
creating a custodianship;
(3) If the trustee does not know of a guardian of the person
or estate, or custodian, paying it to an adult relative or other
person having legal or physical care or custody of the
beneficiary, to be expended on the beneficiary's behalf;
(4) Managing it as a separate fund on the beneficiary's
behalf, subject to the beneficiary's continuing right to withdraw
the distribution.
(V) On distribution of trust property or the division or
termination of a trust, make distributions in divided or undivided
interests, allocate particular assets in proportionate or
disproportionate shares, value the trust property for those
purposes, and adjust for resulting differences in valuation;
(W) Resolve a dispute concerning the interpretation of the
trust or its administration by mediation, arbitration, or other
procedure for alternative dispute resolution;
(X) Prosecute or defend an action, claim, or judicial
proceeding in any jurisdiction to protect trust property and the
trustee in the performance of the trustee's duties;
(Y) Sign and deliver contracts and other instruments that are
useful to achieve or facilitate the exercise of the trustee's
powers;
(Z) On termination of the trust, exercise the powers
appropriate to wind up the administration of the trust and
distribute the trust property to the persons entitled to it;
(AA) Employ agents, attorneys, accountants, investment
advisors, and other professionals.
Sec. 5810.05. (A) A beneficiary may not commence a
proceeding against a trustee for breach of trust more than two
years after the date the beneficiary, a representative of the
beneficiary, or a beneficiary surrogate is sent a report that
adequately discloses the existence of a potential claim for breach
of trust and informs the beneficiary, the representative of the
beneficiary, or the beneficiary surrogate of the time allowed for
commencing a proceeding against a trustee.
(B) A report adequately discloses the existence of a
potential claim for breach of trust if it provides sufficient
information so that the beneficiary or the representative of the
beneficiary knows of the potential claim or should know of the
existence of the potential claim.
(C) If division (A) of this section does not apply,
notwithstanding section 2305.09 of the Revised Code, a judicial
proceeding by a beneficiary against a trustee for breach of trust
must be commenced within four years after the first of the
following to occur:
(1) The removal, resignation, or death of the trustee;
(2) The termination of the beneficiary's interest in the
trust;
(3) The termination of the trust;
(4) The time at which the beneficiary knew or should have
known of the breach of trust.
(D) Nothing in Chapters 5801. to 5811. of the Revised Code
limits the operation of any principle of law or equity, including
the doctrines of laches, unclean hands, estoppel, and waiver, that
can bar claims.
Sec. 5810.11. (A)(1) Except as otherwise provided in
division (C) of this section or unless personal liability is
imposed in the contract, a trustee who holds an interest as a
general partner in a general or limited partnership is not
personally liable on a contract entered into by the partnership
after the trust's acquisition of the interest if the fiduciary
capacity was disclosed. A partnership certificate that is filed
pursuant to Chapter 1777. or another chapter of the Revised Code
and that indicates that a trustee holds a general partnership
interest in a fiduciary capacity by the use following the name or
signature of the trustee of the words "as trustee" or other words
that indicate the trustee's fiduciary capacity constitutes a
sufficient disclosure for purposes of this division.
(2) If a partnership certificate is not required to be filed
pursuant to Chapter 1777. or another chapter of the Revised Code,
a sufficient disclosure for purposes of division (A) of this
section can be made by a trustee if a certificate that is filed
with the recorder of the county in which the partnership's
principal office or place of business is situated and with the
recorder of each county in which the partnership owns real estate
satisfies all of the following requirements:
(a) The certificate states in full the names of all persons
holding interests in the partnership and their places of
residence.
(b) The certificate is signed by all persons who are general
partners in the partnership and is acknowledged by a person
authorized to take acknowledgements of deeds.
(c) The certificate uses the words "trustee under the (will
or trust) of (name of decedent or settlor)," or other words that
indicate the trustee's fiduciary capacity, following the trustee's
name or signature.
(3) A contract or other written instrument that is delivered
to a party that contracts with the partnership in which a trustee
holds a general partnership interest in a fiduciary capacity and
that indicates that the trustee so holds the interest constitutes
a disclosure for purposes of division (A)(1) of this section with
respect to transactions between the party and the partnership. If
a disclosure has been made by a certificate in accordance with
division (A) of this section, a disclosure for purposes of
division (A) of this section with respect to such transactions
exists regardless of whether a contract or other instrument
indicates the trustee holds the general partnership interest in a
fiduciary capacity.
(B) Except as otherwise provided in division (C) of this
section, a trustee who holds an interest as a general partner in a
general or limited partnership is not personally liable for torts
committed by the partnership or for obligations arising from
ownership or control of the interest unless the trustee is
personally at fault.
(C) The immunity provided by this section does not apply if
an interest in the partnership is held by the trustee in a
capacity other than that of trustee or is held by the trustee's
spouse or one or more of the trustee's descendants, siblings, or
parents, or the spouse of any of them.
(D) If the trustee of a revocable trust holds an interest as
a general partner in a general or limited partnership, the settlor
is personally liable for contracts and other obligations of the
partnership as if the settlor were a general partner.
(E) The liability limitations in this section apply to
trustees as partners notwithstanding the broader personal
liabilities otherwise imposed by any partnership law.
(F) If a trust is identified as a partner, the reference is
deemed to be to, and the partner is, the current trustee or
trustees of the trust and their successors as trustees.
Sec. 5810.13. (A) Instead of furnishing a copy of the trust
instrument to a person other than a beneficiary, the trustee may
furnish to the person a certification of trust containing all of
the following information:
(1) A statement that the trust exists and the date the trust
instrument was executed;
(2) The identity of the settlor;
(3) The identity and address of the currently acting trustee;
(4) The powers of the trustee;
(5) The revocability or irrevocability of the trust and the
identity of any person holding a power to revoke the trust;
(6) The authority of cotrustees to sign or otherwise
authenticate and whether all or less than all are required in
order to exercise powers of the trustee;
(7) The trust's taxpayer identification number;
(8) The manner of taking title to trust property.
(B) Any trustee may sign or otherwise authenticate a
certification of trust.
(C) A certification of trust shall state that the trust has
not been revoked, modified, or amended in any manner that would
cause the representations contained in the certification of trust
to be incorrect.
(D) A certification of trust is not required to contain the
dispositive terms of a trust.
(E) A recipient of a certification of trust may require the
trustee to furnish copies of those excerpts from the original
trust instrument and later amendments that designate the trustee
and confer upon the trustee the power to act in the pending
transaction.
(F) A person who acts in reliance upon a certification of
trust without knowledge that the representations contained in the
certification are incorrect is not liable to any person for so
acting and may assume without inquiry the existence of the facts
contained in the certification. Knowledge of the terms of the
trust may not be inferred solely from the fact that a copy of all
or part of the trust instrument is held by the person relying upon
the certification.
(G) A person who in good faith enters into a transaction in
reliance upon a certification of trust may enforce the transaction
against the trust property as if the representations contained in
the certification were correct.
(H) A person making a demand for the trust instrument in
addition to a certification of trust or excerpts is liable for
damages if the court determines that the person did not act in
good faith in demanding the This section does not affect the use
or validity of a memorandum of trust instrument under section
5301.255 of the Revised Code.
(I) This section does not limit the right of a person to
obtain a copy of the trust instrument in a judicial proceeding
concerning the trust.
Sec. 5815.35. (A)(1) As used in this division, "fiduciary"
means any person, association, or
corporation, other than a
trustee of a testamentary trust, an assignee or trustee for an
insolvent
debtor, or a guardian under Chapter 5905. of the Revised
Code,
that is appointed by and accountable to the probate court,
and
that is acting in a fiduciary capacity for another or charged
with duties in relation to any property, interest, or
estate for
another's benefit. A fiduciary also includes an
agency under
contract with the department of mental retardation
and
developmental disabilities for the provision of protective
service
under sections 5123.55 to 5123.59 of the Revised Code,
when
appointed by and accountable to the probate court as a
guardian or
trustee for a mentally retarded or developmentally
disabled
person.
(2) A fiduciary who enters a contract as
fiduciary on or
after March 22, 1984, is not personally
liable on that contract,
unless the contract otherwise specifies,
if the contract is within
the fiduciary's authority
and the fiduciary discloses that the
contract is being
entered into in a fiduciary capacity. In a
contract, the words "fiduciary" or "as
fiduciary" or other words
that indicate one's
fiduciary capacity following the name or
signature of a fiduciary are sufficient disclosure for purposes of
this
division.
(B)(1) As used in this division, "partnership" includes a
partnership composed of only
general partners and a partnership
composed of general and
limited partners.
(2) Subject to division (D) of this section, an executor
or
administrator who acquires, in a fiduciary
capacity, a general
partnership interest upon the death of a
general partner of a
partnership is not personally liable for any debt, obligation,
or
liability of the partnership that arises from the executor's or
administrator's actions,
except as provided in this division, as a
general partner, or for
any debt, obligation, or liability of the
partnership for which
the executor or administrator otherwise
would be personally liable because the executor or administrator
holds the
general partnership interest, if the executor or
administrator discloses that the general
partnership interest is
held by the executor or administrator in a fiduciary capacity.
This immunity does not apply if an executor or administrator
causes loss or injury to a person who is not a partner in
the
partnership by a wrongful act or omission. This immunity is
not
available to an executor or administrator who holds
a general
partnership interest in a fiduciary capacity if
the spouse or any
lineal descendants of the executor or administrator, or the
executor
or administrator other than in a fiduciary
capacity,
holds any interest in the partnership.
A partnership certificate that is filed pursuant to Chapter
1777. or another chapter of the Revised Code and that indicates
that an executor or administrator holds a general
partnership
interest in a fiduciary capacity by the use following
the name or
signature of the executor or administrator
of the words "executor
under the will of (name of decedent)"
or "administrator of the
estate of (name of decedent)" or
other words that indicate the
executor's or administrator's fiduciary capacity constitutes a
sufficient disclosure
for purposes of this division.
If a partnership certificate is not required to be filed
pursuant to Chapter 1777. or another chapter of the Revised Code,
a sufficient disclosure for purposes of this division can be made
by an executor or administrator if a certificate that
satisfies
the following requirements is filed with the recorder
of the
county in which the partnership's principal office or
place of
business is situated and with the recorder of each
county in which
the partnership owns real estate:
(a) The certificate shall state in full the names of all
persons holding interests in the partnership and their places of
residence;
(b) The certificate shall be signed by all persons who are
general partners in the partnership, and shall be acknowledged by
a person authorized to take acknowledgements of deeds;
(c) The certificate shall use the words "executor under
the
will of (name of decedent)" or "administrator of the estate of
(name of decedent)" or other words that indicate the
executor's or
administrator's fiduciary capacity,
following the name or
signature of the executor or administrator.
A contract or other written instrument delivered to a party
that contracts with the partnership in which an executor
or
administrator holds a general partnership interest in
a fiduciary
capacity, which that indicates that the executor
or administrator
so holds the interest, constitutes a
disclosure for purposes of
this division with respect to
transactions between the party and
the partnership. If a
disclosure has been made by a certificate in
accordance with this
division, a disclosure for purposes of this
division with respect
to such transactions exists regardless of
whether a contract or
other instrument indicates the executor or
administrator holds the general partnership interest in a
fiduciary
capacity.
If an executor or administrator acquires, in
a
fiduciary
capacity, a general partnership interest, the
decedent's estate is
liable for debts, obligations,
or liabilities of the partnership.
(C) An estate that includes a general partnership
interest is
not liable for the debts, obligations, or liabilities
of a
partnership in which another estate has a general
partnership
interest, merely because the executor or administrator of the
estates holds a general partnership
interest in both of the
partnerships in the executor's
or administrator's fiduciary
capacities.
(D) Divisions (B) and (C) of this section apply to general
partnership interests held by executors or administrators in their
fiduciary capacities prior to and on or after
the effective date
of this section March 22, 1984. If an appropriate disclosure
is
made pursuant to division (B) of this section, the immunity
acquired under that division extends only to debts, obligations,
and liabilities of the partnership arising on and after the date
of the disclosure and to debts, obligations, and liabilities of
the partnership that arose prior to the acquisition of the
general
partnership interest by the executor or administrator becoming a
general partner.
(E) The liability limitations in this section apply to
fiduciaries as partners notwithstanding the broader personal
liabilities otherwise imposed by any partnership law.
(F) If an estate or other fund held by a fiduciary is
identified as a partner, the reference is deemed to be to, and the
partner is, the current executor, administrator, or other
fiduciary of the estate or other fund and their successors as
executors, administrators, or other fiduciaries.
SECTION 2. That existing sections 2109.01, 5801.01, 5801.02,
5801.06, 5801.10, 5803.02, 5803.03, 5804.02, 5804.11, 5804.13,
5804.14, 5804.17, 5805.01, 5805.03, 5806.01, 5806.02, 5806.03,
5806.04, 5808.13, 5808.14, 5808.16, 5810.05, 5810.11, 5810.13, and
5815.35 and
section 2109.022 of the Revised Code are hereby
repealed.
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