Florida Statutes 738.202 – Judicial review of exercise of discretionary power; request for instruction
Current as of: 2024 | Check for updates
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(1) As used in this section, the term “fiduciary decision” means any of the following:
(a) A fiduciary‘s allocation between income and principal or other determination regarding income and principal required or authorized by the terms of the trust or this chapter.
Terms Used In Florida Statutes 738.202
- 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: includes :(a) For a trust:1. See Florida Statutes 738.102
- Court: means a circuit court of this state. See Florida Statutes 738.102
- Distribution: means a payment or transfer by a fiduciary to a beneficiary in the beneficiary's capacity as a beneficiary, without consideration other than the beneficiary's right to receive the payment or transfer under the terms of the trust as defined in this section, will, life estate, or term interest. See Florida Statutes 738.102
- Fiduciary: A trustee, executor, or administrator.
- Fiduciary: includes a trustee, a trust director as defined in…. See Florida Statutes 738.102
- Income: means money or other property a fiduciary receives as current return from principal. See Florida Statutes 738.102
- Principal: means property held in trust for distribution to, production of income for, or use by a current or successor beneficiary. See Florida Statutes 738.102
- Trust: includes an express trust, whether private or charitable, with additions to the trust, wherever and however created; and a trust created or determined by a judgment or decree under which the trust is to be administered in the manner of an express trust. See Florida Statutes 738.102
(b) The fiduciary‘s exercise or nonexercise of a discretionary power regarding income and principal granted by the terms of the trust or this chapter, including the power to adjust under s. 738.203, convert an income trust to a unitrust under ss. 738.301–738.310, change the percentage or method used to calculate a unitrust amount under ss. 738.301–738.310, convert a unitrust to an income trust under ss. 738.301–738.310, or the method used to make property productive of income under s. 738.413.(c) The fiduciary’s implementation of a decision described in paragraph (a) or paragraph (b).(2) The court may not order a fiduciary to change a fiduciary decision unless the court determines that the fiduciary decision was an abuse of the fiduciary’s discretion. A court may not determine that a fiduciary abused its discretion merely because the court would have exercised the discretion in a different manner or would not have exercised the discretion.(3) If the court determines that a fiduciary decision was an abuse of the fiduciary’s discretion, the court may order a remedy authorized by law, including those prescribed under ss. 736.1001 and 736.1002. Following such a determination by the court, the remedy is to place the beneficiaries in the positions the beneficiaries would have occupied if the fiduciary had not abused its discretion, as follows:(a) The court may order the fiduciary to exercise or refrain from exercising the power to adjust under s. 738.203;(b) The court may order the fiduciary to exercise or refrain from exercising the power to convert an income trust to a unitrust under ss. 738.301–738.310, change the percentage or method used to calculate a unitrust amount under ss. 738.301–738.310, or convert a unitrust to an income trust under ss. 738.301–738.310;(c) The court may compel the fiduciary to take any of the actions listed under s. 738.413;(d) To the extent that the abuse of discretion has resulted in no distribution to a beneficiary or a distribution that is too small, the court shall require the fiduciary to distribute from the trust to the beneficiary an amount the court determines will restore the beneficiary, in whole or in part, to his or her appropriate position;(e) To the extent that the abuse of discretion has resulted in a distribution to a beneficiary that is too large, the court shall restore the beneficiaries, the trust, or both, in whole or in part, to their appropriate positions by requiring the fiduciary to withhold an amount from one or more future distributions to the beneficiary who received the distribution that was too large or requiring that beneficiary to return some or all of the distribution to the trust; or(f) To the extent that the court is unable, after applying paragraphs (a)-(e), to restore the beneficiaries or the trust, or both, to the positions they would have occupied if the fiduciary had not abused its discretion, the court may require the fiduciary to pay an appropriate amount from its own funds to one or more of the beneficiaries or the trust or both.(4) On petition by the fiduciary for instruction, the court may determine whether a proposed fiduciary decision will result in an abuse of the fiduciary’s discretion. If the petition describes the proposed decision, contains sufficient information to inform the beneficiary of the reasons for making the proposed decision and the facts on which the fiduciary relies, and explains how the beneficiary will be affected by the proposed decision, a beneficiary who opposes the proposed decision has the burden to establish that it will result in an abuse of the fiduciary’s discretion.(5) If an action is instituted alleging an abuse of discretion in the exercise or nonexercise of the fiduciary’s discretion under this chapter and the court determines no abuse of discretion has occurred, the fiduciary’s costs and attorney fees incurred in defending the action shall be paid from the trust assets.