As has been noted in several previous posts on this blog, the use of trusts has grown in frequency over the past few decades in Florida and throughout the country. Further, trusts are being used more often by people who are not millionaires, but individuals who wish to use the trust instruments for specific purposes. The person whose job it is to ensure that the trust does what its creator intended is, of course, the trustee. The trustee is sometimes a lawyer or a financial institution, but lay people can also be named trustees. So, what exactly are trustees required to do under Florida law?
The law regarding trusts in Florida is found in Title XLII, Chapter 736 of the Florida Statutes. There are sections regarding the creations of trusts and how a trustee accepts or declines the position. Once the trustee has accepted the office, however, his or her duties are set out in Part VIII of the chapter. This part explains the basic legal requirements that a trustee has to meet while he or she administers the trust.
First, the trustee must administer the trust in good faith, following the provisions as set out in the trust instrument. Similarly, the trustee has a duty of loyalty to the beneficiaries of the trust. This means that the trustee must control the trust assets in such a way as they are always being utilized in the best interests of the beneficiaries of the trust, not the interests of the trustee or any third party. The trustee also has a duty of impartiality if there is more than one beneficiary of the trust. That is, the trustee cannot favor one beneficiary over the other in trust administration. Finally, the trustee has a duty of prudent administration of the trust. This means that, within the parameters set out by the trust instrument, the trust must be administered in the way a reasonable and prudent individual would.
There are many other, more subtle requirements to trust administration, but the above is a general view of what duties a trustee would have under Florida law. If one wished to have more specific information with regard to Florida trusts, it might be a good idea to consult a trusts and estates attorney.
Source: Leg.state.fl.us, “PART VIII DUTIES AND POWERS OF TRUSTEE,” accessed on Aug. 25, 2014