Arizona Laws 14-10808. Powers to direct
A. While a trust is revocable, the trustee may follow a direction of the settlor that is contrary to the terms of the trust.
Terms Used In Arizona Laws 14-10808
- Action: includes any matter or proceeding in a court, civil or criminal. See Arizona Laws 1-215
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Beneficiary: means a person who either:
(a) Has a present or future beneficial interest in a trust, vested or contingent. See Arizona Laws 14-10103
- Fiduciary: A trustee, executor, or administrator.
- Fiduciary: includes a personal representative, guardian, conservator and trustee. See Arizona Laws 14-1201
- Interests of the beneficiaries: means the beneficial interests provided in the terms of the trust. See Arizona Laws 14-10103
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency or instrumentality, public corporation or any other legal or commercial entity. See Arizona Laws 14-10103
- Settlor: means a person, including a testator, who creates or contributes property to a trust. See Arizona Laws 14-10103
- 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. See Arizona Laws 14-10103
- Trust: includes an express trust, private or charitable, with any additions, wherever and however created. See Arizona Laws 14-1201
- Trust instrument: means an instrument executed by the settlor that contains terms of the trust, including any amendments to that trust. See Arizona Laws 14-10103
- Trustee: A person or institution holding and administering property in trust.
- Trustee: includes an original, additional and successor trustee and a cotrustee. See Arizona Laws 14-10103
B. If the trust provides that the assets in the trust are subject to the direction of the settlor or a cotrustee, beneficiary or third party, the trustee has no duty to review the directions it is directed to make or to notify the beneficiaries regarding any investment action taken pursuant to the direction. The trustee is not responsible for the purchase, monitoring, retention or sale of assets that are subject to the direction of the settlor or a cotrustee, beneficiary or third party. The trustee is not subject to liability if the trustee acts pursuant to the direction, even if the actions constitute a breach of fiduciary duty, unless the trustee acts in bad faith or with reckless indifference.
C. The terms of a trust may confer on a trustee or other person a power to direct the modification or termination of the trust.
D. Unless the trust instrument provides otherwise, a person, other than a beneficiary, who holds a power to direct is presumptively a fiduciary who, as such, is required to act in good faith with regard to the purposes of the trust and the interests of the beneficiaries. The holder of a power to direct is liable for any loss that results from breach of a fiduciary duty.