216.242.6054

FREE CONSULTATION | Call 216.242.6054

Blog

Trust Administration under the Ohio Trust Code

January 23, 2020, by Daniel McGowan, on New Probate & Trust Cases |

ADMINISTRATION OF TRUSTS IN OHIO

 

            Where a trust instrument exists, administration may still go beyond the four corners of that instrument:

 

  1. Settlor Intent Controls:  Ohio Revised Code § 5808.08(A) states that while a trust is revocable, the trustee may follow a direction of the settlor that is contrary to the terms of the trust. 

 

            This is also reflected in Ohio Revised Code § 5806.03(A), which states that during the lifetime of the settlor of a revocable trust, whether the settlor has capacity to revoke the trust, or not, 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 Ohio Revised Code 5808.13, are owed exclusively to the settlor. 

 

            Statutory Requirements Exist:  The terms of the trust cannot prevail over the requirements of certain provisions of Ohio Revised Code Chapters 5808 to 5811, as listed under Ohio Revised Code § 5801.04(B). 

 

            A settlor can exclude a trustee from certain rights and authorities, retaining such personally or providing such to others, thereby causing the trustee to be excluded from certain administrative actions:  Per Ohio Revised Code § 5815.25(C), an excluded fiduciary is not liable, either individually or as a fiduciary, for any loss that results from compliance with an authorized direction of the grantor, committee, person, or persons. 

 

            The terms of the trust may be modified or revoked:  Per Ohio Revised Code § 5808.08(C), the terms of a trust may confer upon a trustee or other person a power to direct the modification or termination of the trust. 

 

            Pursuant to Ohio Revised Code § 5806.02(A), for trusts created under an instrument executed before January 1, 2007, unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. 

 

            Pursuant to Ohio Revised Code § 5806.02(G), a trustee who does not know that a trust has been revoked or amended is not liable to the settlor or settlor's successors in interest for distributions made and other actions taken on the assumption that the trust had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. 

 

            A court may modify, terminate or reform a trust to further the settlor's intentions:  This is discussed later in additional blog entries at this web site.