In a trust, the trust creator (referred to as trustor or settlor) transfers the ownership of specific assets to a trustee (fiduciary). The trustee holds nominal ownership of the assets held in trust for the benefit of the beneficiaries designated by the trustor.
Trustees owe a fiduciary duty to the trust and its beneficiaries, a fact that exposes them to a high degree of liability if things do not go as expected. Keep reading to find out the statutory duties of Florida trustees.
What Are the Duties of a Trustee in Florida? – The Essentials
Duty to Administer
The primary duty of a Florida trustee is to administer the trust adequately. Florida Statutes §736.0801 specify that “upon acceptance of a trusteeship, the trustee shall administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with this code.”
Duty of Loyalty
A trustee must uphold the duty of loyalty to the property held in trust and its beneficiaries. Under Florida Statutes §736.0802 (1), “as between a trustee and the beneficiaries, a trustee shall administer the trust solely in the interests of the beneficiaries.”
Duty of Impartiality
When administering the trust, the trustee must balance the interest of all the beneficiaries involved in the arrangement. Hence, Florida law expressly states that “the trustee shall act impartially (…), giving due regard to the beneficiaries’ respective interests.”
Prudently Administering the Trust
Florida Statutes §736.0804 provides that “a trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust.”
Therefore, “in satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.”
Maintaining Reasonable Expenses
When administering a Florida trust, the trustee can only incur expenses that are reasonable in comparison to the trust property. Also, the trustee must consider the purposes of the trust and his or her administration skills when incurring any expenses.
Trustee’s Personal Expertise
Florida Statutes §736.0806 require that “a trustee who has special skills or expertise or is named trustee in reliance on the trustee’s representation that the trustee has special skills or expertise, shall use those special skills or expertise.”
Controlling and Protecting Trust Property
A Florida trustee must take all reasonable steps to control and protect the property held in a trust. While executing this duty, he or she must also “keep clear, distinct, and accurate records of the administration of the trust.” (Fla. Stat. §736.0810)
Not Commingling Personal Assets with Trust Assets
One of the key practices to avoid a breach of fiduciary duty is keeping the trustee’s personal property separate from the property held in a trust. Specifically, Florida Statutes §736.0810 (2) requires that “a trustee shall keep trust property separate from the trustee’s own property.”
Duty to Inform and Account
The trustee must keep all individuals with an interest in the property held in a trust reasonably informed about the facts involved in the trust administration. As part of the duty to inform and account, a trustee must provide:
- Notice of acceptance of the trust
- Notice of knowledge of the creation of an irrevocable trust
- Notice of acknowledgment that a formerly revocable trust has become irrevocable
- Annual accounting of the assets held in a trust
Also, Florida Statutes §736.0813 (c) provides that “upon reasonable request, the trustee shall provide a qualified beneficiary with a complete copy of the trust instrument.”
Immediately Contact Your Florida Probate Lawyer
Serving as a trustee to a Florida trust is not an easy task. Waste no time – call Attorneys Romy B. Jurado and Diana C. Collazos at (305) 921-0976 or email [email protected] for expert legal guidance.
