ORS 130.445 Dismissal for want of prosecution

If the trustee does not file a petition to close the case under ORS 130.440 within one year after filing a petition under ORS 130.355, the court clerk shall mail a notice to the trustee, or the attorney for the trustee if the trustee is represented by counsel, informing the trustee that a judgment of dismissal will be entered in the case for want of prosecution unless an application for a continuance is made to the court and good cause is shown within 60 days after the date of the notice. Good cause for a continuance includes the pendency of a separate action under ORS 130.400 (4).

If an application for a continuance is not made under this section, or the court fails to find good cause for a continuance, the court shall enter a judgment of dismissal of the proceeding without prejudice. The dismissal does not bar a claimant’s right to pursue claims against a trustee, and a claimant shall have the same rights as if the trustee filed no proceeding. [Formerly 128.298] 130.450 Consolidation of proceedings. If the proceeding to determine claims against a deceased settlor is pending under ORS 130.350 to 130.450 at the same time as probate proceedings under ORS chapter 115, upon motion of any party or upon the court’s own motion, any of the courts conducting proceedings may:

Order a joint hearing or trial on the common claims;

Order that the proceedings be consolidated; or

Make orders concerning the proceedings to avoid unnecessary costs for delays. [Formerly 128.300]

130.500 UTC 601. Revocable trusts generally. (1) A person who has capacity to make a will has capacity to create, amend, revoke or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust.

A revocable trust remains a revocable trust for the purposes of ORS 130.520 to 130.575 even though the trust cannot be revoked because:

The settlor becomes financially incapable; or

An event occurs that by the terms of the trust prevents the revocation of the trust. [2005 c.348 §45; 2009 c.275 §16] 130.505 UTC 602. Revocation or amendment of revocable trust. (1) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor of the trust may revoke or amend the trust.

Unless the trust expressly provides otherwise, if a revocable trust is created or funded by more than one settlor:

To the extent the trust consists of community property, the trust may be revoked by either spouse acting alone but may be amended only by joint action of both spouses;

To the extent the trust consists of property other than community property, each settlor may revoke or amend the trust as to the portion of the trust property attributable to that settlor’s contribution; and

Upon the revocation or amendment of the trust by fewer than all of the settlors, the trustee shall promptly notify the other settlors of the revocation or amendment.

The settlor may revoke or amend a revocable trust:

By substantial compliance with a method provided in the terms of the trust; or

If the terms of the trust do not provide a method, by any other method, except for execution of a will or codicil, manifesting clear and convincing evidence of the settlor’s intent.

Upon revocation of a revocable trust, the trustee shall deliver the trust property as the settlor directs.

A settlor’s powers with respect to revocation, amendment or distribution of trust property may be exercised by an agent or attorney-in-fact under a power of attorney only to the extent expressly authorized by the terms of the trust.

The settlor’s conservator, or the settlor’s guardian if a conservator has not been appointed for the settlor, may exercise a settlor’s powers with respect to revocation,

amendment or distribution of trust property only with the approval of the court supervising the conservatorship or guardianship.

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. [2005 c.348 §46]

provides: Sec. 47. Section 46 (1) of this 2005 Act [130.505 (1)] does not apply to a trust created under an instrument executed before the effective date of this 2005 Act [January 1, 2006]. [2005 c.348 §47] 130.510 UTC 603. Settlor’s powers; powers of withdrawal. (1) While the settlor of a revocable trust is alive, rights of the beneficiaries are subject to the control of the settlor, and the duties of the trustee are owed exclusively to the settlor. Beneficiaries other than the settlor have no right to receive notice, information or reports under this chapter.

The rights of the beneficiaries with respect to property that is subject to a power of withdrawal are subject to the control of the holder of the power during the period that the power may be exercised, and the duties of the trustee are owed exclusively to the holder of a power of withdrawal with respect to the property that is subject to the power. [2005 c.348 §48; 2009 c.275 §17] 130.515 UTC 604. Limitation on action contesting validity of revocable trust; distribution of trust property. (1) A person must commence a judicial proceeding to contest the validity of a trust that was revocable at the settlor’s death in the manner prescribed by ORS 12.020 within the earlier of:

Three years after the settlor’s death; or

Four months after the trustee sends the person a copy of the trust instrument and notice informing the person of the trust’s existence, of the trustee’s name and address and of the time allowed for commencing a proceeding.

Upon the death of the settlor of a trust that was revocable at the settlor’s death, the trustee may proceed to distribute the trust property in accordance with the terms of the trust. The trustee is not subject to liability for distribution of the property unless:

The trustee knows of a pending judicial proceeding contesting the validity of the trust; or

Any person has notified the trustee in writing that the person might commence a judicial proceeding to contest the trust and a judicial proceeding is commenced by the person within 60 days after the person gives the notification.

If a trust is determined to be invalid, any beneficiary who received a distribution from the trust is liable to the person entitled to the distributed property for the amount or value of the distribution. [2005 c.348 §49]

130.518 Creditor protections retained upon conveyance of property held as tenants by the entirety to revocable trust.

Real property of spouses married to each other that was held as tenants by the entirety and subsequently conveyed to the trustee or trustees of the joint revocable trust of the spouses or of the separate revocable trust of each spouse shall have the same immunity from the claims of a spouse’s creditors as would exist if the spouses had continued to hold the property as tenants by the entirety, if:

The spouses remain married to each other;

The real property continues to be held in trust by the trustee or trustees or the successor trustee or trustees; and

Both spouses are beneficiaries of the trust or trusts, including where both spouses are current beneficiaries of one trust that holds the entire property or each spouse is a current beneficiary of a separate trust and the two separate trusts together hold the entire property, whether or not other persons are also current or future beneficiaries of the trust or trusts.

The protection from the claims of separate creditors under this section may be waived as to any specific creditor, including any separate creditor of either spouse, or any specifically described property, including any former tenancy by the entirety property conveyed into trust, by the trustee acting under the express provision of a trust instrument or with the written consent of both spouses. [2021 c.272 §7]

provides: Sec. 12. Section 7 of this 2021 Act [130.518] and the amendments to ORS 130.315 by section 8 of this 2021 Act apply to tenancy by the entirety property conveyed to a trustee or trustees of a trust or trusts on or after the effective date of this 2021 Act [January 1, 2022]. [2021 c.272 §12]

Assembly but was not added to or made a part of ORS chapter 130 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation.

130.520 “Specific distribution” defined for ORS 130.520 to 130.575. For the purposes of ORS 130.520 to 130.575, “specific distribution” means a distribution of specific property to a specific beneficiary that is required under the terms of a trust instrument. [Formerly 128.370] 130.525 Applicability of ORS 130.530, 130.535 and 130.540 to 130.575. (1) ORS 130.530 and 130.535 apply only to a trust, or portion of a trust:

That comes into existence during the settlor’s lifetime; and

Is a revocable trust on the occurrence of any of the events described in ORS 130.530 or 130.535.

ORS 130.540 to 130.575 apply only to a trust, or a portion of a trust, that comes into existence during the settlor’s lifetime and that was a revocable trust at the time of the settlor’s death. [2005 c.348 §110; 2013 c.529 §10] 130.530 Effect of marriage. Unless otherwise provided by the terms of the trust instrument, a trust is not revoked by the marriage of the settlor after the trust instrument is executed. [Formerly 128.375] 130.535 Revocation by divorce or annulment.

Unless otherwise provided by the terms of the trust instrument, a settlor’s divorce or the annulment of the settlor’s marriage, after the trust instrument is executed:

Revokes all provisions of the trust in favor of the former spouse of the settlor;

Revokes all powers of appointment, general or nongeneral, in the trust that are exercisable by the former spouse; and

Revokes any provision in the trust naming the former spouse as trustee.

Unless otherwise provided by the terms of the trust instrument, a trust shall be construed as though the former spouse predeceased the settlor if, after the trust instrument is executed, the settlor divorces the spouse or the marriage of the settlor to the spouse is annulled. [Formerly 128.378] 130.540 Contract of sale of property not revocation. Unless otherwise provided by the terms of the trust instrument, a contract of sale made by a trustee to convey property that is the subject of a specific distribution is not a revocation of the specific distribution. If all or part of the property that is the subject of the contract of sale has not been delivered at the time set in the trust instrument for the specific distribution, the property passes by the specific distribution but is subject to the terms of the contract of sale. [Formerly 128.380] 130.545 Encumbrance or disposition of property after trust instrument executed. Unless otherwise provided by the terms of the trust instrument:

A disposition of a portion of property that is subject to a specific distribution does not affect the operation of the trust upon the remaining portion of the property; and

If property subject to a specific distribution is encumbered, the property passes under the specific distribution but is subject to the encumbrance. [Formerly 128.382] 130.550 When trust assets pass to descendants of beneficiary; class gifts. Unless otherwise provided by the terms of the trust instrument, when property is to be distributed under the trust to any beneficiary who is related by blood or adoption to the settlor, and the beneficiary dies leaving lineal descendants either before the settlor dies or before the time set in the trust instrument for distribution, the descendants take by right of representation the property the beneficiary would have taken if the beneficiary had not died. Unless otherwise provided by the terms of the trust instrument, this section applies to a beneficiary who is entitled to receive property under a class gift if the beneficiary dies after the trust instrument is executed. [Formerly 128.385] 130.555 Children of settlors; pretermitted children. (1) As used in this section, “pretermitted child” means a child of a settlor who, after the execution of the trust instrument, is born or adopted during the lifetime of the settlor or is in gestation at the time of the settlor’s death, who is not acknowledged or mentioned, either by name or by class, in the trust instrument or in the settlor’s will, and who survives the settlor.

If a settlor has one or more children living when the settlor executes a trust instrument and no provision is made in the trust for any of those children, a pretermitted child is not entitled to any share of the trust estate.

If a settlor has one or more children living when the settlor executes a trust instrument and provision is made in the trust for any of those children, a pretermitted child is entitled to share in the trust estate as follows:

The pretermitted child may share only in the portion of the trust estate intended to benefit living children.

The share of each pretermitted child is equal to the total value of the portion of the trust estate intended to benefit the living children divided by the number of pretermitted children plus the number of living children for whom provision, other than nominal provision, is made in the trust.

To the extent possible, the interest of each pretermitted child in the trust estate shall be of the same character, whether equitable or legal, as the interest the settlor gave to the living children under the trust.

If a settlor has no child living when the settlor executes a trust instrument, the pretermitted children are entitled to the following share of the trust estate:

If the settlor dies leaving a surviving spouse and all pretermitted children are the issue of the surviving spouse, the pretermitted children are not entitled to any share of the trust estate.

If the settlor dies leaving a surviving spouse and not all pretermitted children are the issue of the surviving spouse, the pretermitted children, as a class, are entitled to one-half of the trust estate, with shares of the trust to be divided equally.

If the settlor dies without leaving a surviving spouse, the pretermitted children are entitled to the entire trust estate, with shares of the trust to be divided equally.

A pretermitted child may recover the share of the trust estate to which the child is entitled as follows:

If the pretermitted child is entitled to a share of the trust estate under subsection

of this section, the share must be recovered from the other children.

If the pretermitted child is entitled to a share of the trust estate under subsection

of this section, the share must be recovered from the beneficiaries on a pro rata basis, out of the portions of the trust estate passing to those persons under the trust.

In reducing the shares of the beneficiaries under this subsection, the character of the dispositive plan adopted by the settlor in the trust must be preserved to the extent possible. [Formerly 128.388; 2013 c.529 §11] 130.560 Failure of specific distribution.

Subject to this section, a specific distribution does not fail by reason of the destruction, damage, sale, condemnation or change in form of the property that is the subject of the specific distribution unless:

The trust instrument provides that the specific distribution fails under the particular circumstances; or

The settlor, during the lifetime of the settlor, or the trustee gives property to the beneficiary of the specific distribution with the intent of satisfying the specific distribution.

If part of the property that is the subject of a specific distribution is destroyed, damaged, sold or condemned, the remaining interest in the property passes pursuant to the specific distribution. The part of the property that is destroyed, damaged, sold or condemned is subject to subsections (3) to (6) of this section if the property would have been adeemed under the common law had the property been subject to probate in the settlor’s estate.

If property that is the subject of a specific distribution is insured and the property is destroyed or damaged, the beneficiary of the specific distribution is entitled to receive the following amounts, less any amount expended or incurred by the settlor or trust estate in restoration or repair of the property:

Any insurance proceeds for the destroyed or damaged property unpaid at the time set in the trust instrument for the specific distribution; and

An amount equal to all insurance payments paid to the settlor, and such proceeds or awards paid to the trustee for the destroyed or damaged property, during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.

If property that is the subject of a specific distribution is sold by the settlor or the trustee, the beneficiary of the specific distribution is entitled to receive:

Any balance of the purchase price unpaid at the time set in the trust instrument for the specific distribution, including any security interest in the property and interest accruing before the time set in the trust instrument for the specific distribution; and

An amount equal to all payments paid to the settlor or the trustee for the property during the six-month period immediately preceding the time set in the trust instrument for the specific distribution. Acceptance of a promissory note of the purchaser or a third party is not considered payment under this paragraph, but payment on the note is payment on the purchase price.

If property that is the subject of a specific distribution is taken by condemnation before the time set in the trust instrument for the specific distribution, the beneficiary of the specific distribution is entitled to receive:

Any amount of the condemnation award unpaid at the time set in the trust instrument for the specific distribution; and

An amount equal to the sums paid under the condemnation award to the settlor or the trustee during the six-month period immediately preceding the time set in the trust instrument for the specific distribution.

If securities as defined in ORS 59.015 are the subject of a specific distribution, and

after the execution of the trust instrument other securities of the same or another entity are distributed to the trustee or trust estate by reason of a partial liquidation, stock dividend, stock split, merger, consolidation, reorganization, recapitalization, redemption, exchange or any other similar transaction, the specific distribution includes the additional or substituted securities.

The amount that a beneficiary of a specific distribution receives under this section must be reduced by any expenses of the sale or of the collection of the proceeds of insurance, sale or condemnation award and by any amount by which income is increased by reasons of items provided for in this section. Expenses subject to this subsection include attorney fees. [Formerly 128.390] 130.565 Effect of failure of specific distribution. If a specific distribution, other than a specific distribution that governs the residue of the trust estate, fails for any reason, the property that is the subject of the specific distribution becomes part of the residue and must be distributed as provided by the terms of the trust instrument for the residue. [Formerly 128.392] 130.570 Advancement against share of trust. Property that the settlor gives during the settlor’s lifetime to a beneficiary of the trust is an advancement against the beneficiary’s share of the trust only if either the settlor makes a written statement that the property constitutes an advancement or the beneficiary makes a written statement acknowledging that the property constitutes an advancement. For purposes of applying the property against the beneficiary’s share of the trust, the property must be valued as of the time the beneficiary takes possession or enjoyment of the property, or as of the time of death of the settlor, whichever occurs first. [Formerly 128.395] 130.575 Effect of advancement on distribution.

If the value of an advancement made to a beneficiary under ORS 130.570 exceeds the beneficiary’s share in the trust estate, the beneficiary shall be excluded from any further share of the trust estate, but the beneficiary is not required to refund any part of the advancement. If the value of the beneficiary’s share in the trust estate is greater than the value of all property received as advancements, the beneficiary is entitled to receive from the trust estate the balance of the share owing to the beneficiary after deducting all amounts received as advancements.

For the purpose of determining the shares of the beneficiaries of either a residuary gift or a class gift under a trust, the value of all advancements made by the settlor to beneficiaries of such gift shall be added to the value of the total property distributed pursuant to the gift, the sum then divided among all beneficiaries of the gift, and the value of the advancement then deducted from the share of the beneficiary to whom the advancement was made. [Formerly 128.397]

130.600 UTC 701. Acceptance or rejection of trusteeship. (1) Except as otherwise provided in subsection (3) or (4) of this section, a person designated as trustee accepts the trusteeship:

By substantially complying with a method of acceptance provided in the terms of the trust; or

If the terms of the trust do not provide a method of acceptance, or the method provided in the terms of the trust is not expressly made exclusive, by knowingly accepting delivery of the trust property, knowingly exercising powers or performing duties as trustee, or otherwise indicating acceptance of the trusteeship.

A person designated as trustee who has not yet accepted the trusteeship may reject the trusteeship. A designated trustee who does not accept the trusteeship within a reasonable time after knowing of the designation is deemed to have rejected the trusteeship.

A person designated as trustee may act to preserve the trust property without accepting the trusteeship. The person must send a rejection of the trusteeship to the settlor within a reasonable time after taking the action. If the settlor is dead or is financially incapable, the person must send the rejection to a qualified beneficiary within a reasonable time after taking the action.

A person designated as trustee may inspect or investigate trust property to determine potential liability under environmental or other law, or for any other purpose, without accepting the trusteeship. [2005 c.348 §50] 130.605 UTC 702. Trustee’s bond. (1) A trustee shall acquire a bond to secure performance of the trustee’s duties only if a bond is required by the terms of the trust or if a court finds that a bond is needed to protect the interests of the beneficiaries. A court may waive a bond required by the terms of a trust if the court finds that a bond is not needed to protect the interests of the beneficiaries.

The court may specify the amount and terms of a bond. The court may modify or terminate any requirement for a bond at any time.

A trust company as defined in ORS 706.008 need not give a bond, even if required by the terms of the trust. [2005 c.348 §51] 130.610 UTC 703. Cotrustees. (1) Cotrustees who are unable to reach a unanimous decision may act by majority decision.

If a vacancy occurs in a cotrusteeship, the remaining cotrustee or cotrustees may act for the trust.

A cotrustee must participate in the performance of a trustee’s function unless:

The cotrustee is unavailable to perform the function because of absence, illness or disqualification under other law;

The cotrustee is unavailable to perform the function because the cotrustee is temporarily financially incapable; or

The cotrustee has delegated the performance of the function to another trustee pursuant to subsection (5) of this section.

If a cotrustee is unavailable to perform duties because of absence, illness, disqualification under other law or temporary financial incapability, and prompt action is necessary to achieve the purposes of the trust or to avoid injury to the trust property, the remaining cotrustee or a majority of the remaining cotrustees may act for the trust.

Except as prohibited in the terms of the trust, a cotrustee may delegate the performance of a function to another cotrustee, and the other cotrustee may accept the delegation of the performance of the function. The delegation and the acceptance must be in writing. A delegation shall remain in effect until it terminates by its terms, is revoked in writing by the cotrustee making the delegation or is terminated in writing by the cotrustee accepting the delegation.

Except as otherwise provided in subsection

of this section, a cotrustee who does not join in an action of another cotrustee is not liable for the action.

Each cotrustee shall exercise reasonable care to:

Prevent a cotrustee from committing a serious breach of trust; and

Compel a cotrustee to redress a serious breach of trust.

A dissenting cotrustee who joins in an action at the direction of the majority of the cotrustees and who notified any cotrustee of the dissent at or before the time of the action is not liable for the action unless the action is a serious breach of trust. [2005 c.348 §52; 2013 c.529 §12] 130.615 UTC 704. Vacancy in trusteeship; appointment of successor. (1) A vacancy in a trusteeship occurs if:

A person designated as trustee rejects the trusteeship;

A person designated as trustee cannot be identified, cannot be located or does not exist;

A trustee resigns;

A trustee is disqualified or removed;

A trustee dies; or

A guardian or conservator is appointed for an individual serving as trustee.

If one or more cotrustees remain in office, a vacancy in a trusteeship need not be filled. A vacancy in a trusteeship must be filled if the trust has no remaining trustee.

A vacancy in a trusteeship of a noncharitable trust that is required to be filled must be filled in the following order of priority:

By a person designated in the terms of the trust to act as successor trustee;

By a person appointed by unanimous agreement of the qualified beneficiaries; or

By a person appointed by the court.

A vacancy in a trusteeship of a charitable trust that is required to be filled must be filled in the following order of priority:

By a person designated in the terms of the trust to act as successor trustee;

By a person appointed by unanimous agreement of all qualified beneficiaries and the Attorney General; or

By a person appointed by the court.

Whether or not a vacancy in a trusteeship exists or is required to be filled, the court may appoint an additional trustee or special fiduciary whenever the court considers the appointment necessary for the administration of the trust. [2005 c.348 §53; 2013 c.529 §13] 130.620 UTC 705. Resignation of trustee.

A trustee may resign:

After at least 30 days’ notice to the qualified beneficiaries, the settlor, if living, and all cotrustees; or

At any time with the approval of a court.

If a court approves a resignation, the court may issue orders and impose conditions reasonably necessary for the protection of the trust property.

Any liability of a resigning trustee or of any sureties on the trustee’s bond for acts or omissions of the trustee is not discharged or affected by the trustee’s resignation. [2005 c.348 §54]

130.625 UTC 706. Removal of trustee.

The settlor, a cotrustee or a beneficiary may request that a court remove a trustee, or a trustee may be removed by a court on its own motion.

A court may remove a trustee if the court finds:

The trustee has committed a serious breach of trust;

Lack of cooperation among cotrustees substantially impairs the administration of the trust;

Removal of the trustee best serves the interests of the beneficiaries because the trustee is unfit or unwilling, or has persistently failed to administer the trust effectively; or

Removal of the trustee best serves the interests of all of the beneficiaries and:

There has been a substantial change of circumstances or removal has been requested by all of the qualified beneficiaries;

A suitable cotrustee or successor trustee is available; and

The trustee fails to establish by clear and convincing evidence that removal is inconsistent with a material purpose of the trust.

Pending a final decision on a request to remove a trustee, or in lieu of or in addition to removing a trustee, the court may order such appropriate relief under ORS 130.800 (2) as may be necessary to protect the trust property or the interests of the beneficiaries. [2005 c.348 §55; 2013 c.529 §14] 130.630 UTC 707. Delivery of property by former trustee; report. (1) Unless a cotrustee remains in office or the court otherwise orders, a trustee who has resigned or been removed has the duties of a trustee and the powers necessary to protect the trust property until the trust property is delivered to a successor trustee or other person who is entitled to the property.

A trustee who has resigned or been removed shall proceed expeditiously to deliver any trust property in the trustee’s possession to the cotrustee, successor trustee or other person who is entitled to the property.

A successor trustee or the court may require a trustee that has resigned or been removed to send a report as provided in ORS 130.710 (3). Reasonable compensation for preparation of the report, and reasonable fees and costs incurred in the preparation and distribution of the report, shall be paid by the trust. [2005 c.348 §56; 2013 c.529 §15] 130.635 UTC 708. Compensation of trustee. (1) If the terms of a trust do not specify the trustee’s compensation, a trustee is entitled to compensation that is reasonable under the circumstances.

If the terms of a trust specify the trustee’s compensation, the trustee is entitled to be compensated as specified, but the court may allow more or less compensation if:

The duties of the trustee are substantially different from those contemplated when the trust was created; or

The compensation specified by the terms of the trust would be unreasonably low or high.

If more than one trustee is serving and the terms of the trust do not specify the trustees’ compensation, the compensation paid to all trustees under this section shall be based on the total services provided by all trustees.

If the terms of a trust do not specify the trustee’s compensation, the fees paid to third parties, including but not limited to financial advisors, who perform trustee functions must be taken into account in determining reasonable trustee compensation under this section. [2005 c.348 §57; 2013 c.529 §16] 130.640 UTC 709. Reimbursement of expenses. (1) A trustee is entitled to be reimbursed out of the trust property, with reasonable interest if appropriate, for:

Expenses that were properly incurred in the administration of the trust; and

To the extent necessary to prevent unjust enrichment of the trust, expenses that were not properly incurred in the administration of the trust.

A trustee is entitled to be reimbursed out of the trust property or from property that has been distributed from the trust, with reasonable interest, for an advance of money made by the trustee for the protection of the trust. [2005 c.348 §58]

130.650 UTC 801. Duty to administer trust. (1) 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 chapter.

A trustee is not required to object to a modification, reformation or termination of the trust under ORS 130.045, 130.200, 130.205, 130.210, 130.215, 130.220 or 130.225, or a trust combination or division under ORS 130.230, solely because of the existence of the duty to administer the trust under subsection (1) of this section or the duty of loyalty under ORS 130.655 (1). [2005 c.348 §59; 2013 c.529 §17]

130.655 UTC 802. Duty of loyalty. (1) A trustee shall administer the trust solely in the interests of the beneficiaries.

Subject to the rights of persons dealing with or assisting the trustee as provided in ORS 130.855, a sale, encumbrance or other transaction involving the investment or management of trust property entered into by the trustee for the trustee’s own personal account or that is otherwise affected by a conflict between the trustee’s fiduciary and personal interests is voidable by a beneficiary affected by the transaction unless:

The transaction was authorized by the terms of the trust;

The transaction was approved by a court;

The beneficiary did not commence a judicial proceeding within the time allowed by ORS 130.820;

The beneficiary consented to the trustee’s conduct, ratified the transaction or released the trustee in the manner provided by ORS 130.840; or

The transaction involves a contract entered into or claim acquired by the trustee before the person became or contemplated becoming trustee.

A sale, encumbrance or other transaction involving the investment or management of trust property is presumed to be affected by a conflict between the personal and fiduciary interests of the trustee if it is entered into by the trustee with:

The trustee’s spouse;

The trustee’s descendants, siblings or parents, or their spouses;

An agent or attorney of the trustee; or

A corporation or other person or enterprise in which the trustee, or a person that owns a significant interest in the trustee, has an interest that might affect the trustee’s best judgment.

Unless a trustee can establish that the transaction was fair to the beneficiary, a transaction between a trustee and a beneficiary is voidable by the beneficiary if:

The transaction does not concern trust property;

The trustee obtains an advantage from the transaction;

The transaction is outside the ordinary course of the trustee’s business or on terms and conditions substantially less favorable than those the trustee offers similarly situated customers; and

The transaction occurs during the existence of the trust or while the trustee retains significant influence over the beneficiary.

A transaction not concerning trust property in which the trustee engages in the trustee’s individual capacity involves a conflict between personal and fiduciary interests if the transaction concerns an opportunity properly belonging to the trust.

An investment by a trustee in securities of an investment company or an investment trust to which the trustee, or an affiliate of the trustee, provides services in a capacity other than as trustee is not presumed to be affected by a conflict between personal and fiduciary interests if the investment otherwise complies with the prudent investor rule of ORS 130.750 to 130.775. In addition to compensation for acting as trustee, the trustee may be compensated by the investment company or investment trust for providing those services out of fees charged to the trust. If the trustee receives compensation from the investment company or investment trust for providing investment advisory or investment management services, the trustee at least annually shall give notice of the rate and method by which that compensation was determined to the persons entitled under ORS 130.710 to receive a copy of the trustee’s annual report.

In voting shares of stock of a corporation or in exercising powers of control over similar interests in corporations and other forms of business entities, the trustee shall act in the best interests of the beneficiaries. If the trust is an owner of a corporation or other form of business entity, the trustee shall elect or appoint directors or other managers who will manage the corporation or entity in the best interests of the beneficiaries.

This section does not preclude the following transactions, if fair to the beneficiaries:

An agreement between a trustee and a beneficiary relating to the appointment or compensation of the trustee;

Payment of reasonable compensation to the trustee;

A transaction between a trust and another trust, decedent’s estate, custodianship or conservatorship of which the trustee is a fiduciary or in which a beneficiary has an interest;

A deposit of trust money in a financial institution operated by the trustee;

An advance by the trustee of money for the protection of the trust;

An advance by the trustee of money to the trust for the payment of expenses, losses or liabilities sustained by the trustee

in the administration of the trust or by reason of owning or possessing any trust assets; or

A loan to the trustee for the protection of the trust, or for the payment of expenses, losses or liabilities sustained by the trustee in the administration of the trust or by reason of owning or possessing any trust assets. A loan under this paragraph may be from a lender operated by, or affiliated with, the trustee.

A trustee is not required to object to a modification, reformation or termination of the trust under ORS 130.045, 130.200, 130.205, 130.210, 130.215, 130.220 or 130.225, or a trust combination or division under ORS 130.230, solely because of the existence of the duty of loyalty under subsection (1) of this section or the duty to administer the trust under

The court may appoint a special fiduciary to make a decision with respect to any proposed transaction that might violate this section if entered into by the trustee. [2005 c.348 §60; 2007 c.515 §2; 2013 c.529 §18; 2017 c.81 §3]

provides: Sec. 4. The amendments to ORS 130.655 by section 3 of this 2017 Act apply only to transactions occurring on or after the effective date of this 2017 Act [January 1, 2018]. [2017 c.81 §4] 130.660 UTC 803. Impartiality. If a trust has two or more beneficiaries, the trustee shall act impartially in investing, managing and distributing the trust property, giving due regard to the beneficiaries’ respective interests. [2005 c.348 §61] 130.665 UTC 804. Prudent administration. A trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distributional requirements and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill and caution. [2005 c.348 §62] 130.670 UTC 805. Costs of administration. In administering a trust, the trustee may incur only costs that are reasonable in relation to the trust property, the purposes of the trust and the skills of the trustee. [2005 c.348 §63] 130.675 UTC 806. Trustee’s skills. A trustee who has special skills or expertise, or is named trustee in reliance upon the trustee’s representation that the trustee has special skills or expertise, shall use those special skills or expertise in administering the trust. [2005 c.348 §64] 130.680 UTC 807. Delegation by trustee.

A trustee may delegate duties and powers that a prudent trustee of comparable

skills could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill and caution in:

Selecting an agent;

Establishing the scope and terms of the delegation, consistent with the purposes and terms of the trust; and

Periodically reviewing the agent’s actions in order to monitor the agent’s performance and compliance with the terms of the delegation.

In performing a delegated function, an agent owes a duty to the trust to exercise reasonable care to comply with the terms of the delegation.

A trustee who complies with subsection

of this section is not liable to the beneficiaries or to the trust for an action of the agent.

By accepting a delegation of powers or duties from the trustee of a trust that is subject to this state’s law, an agent submits to the jurisdiction of the courts of this state. [2005 c.348 §65] 130.685 UTC 808. Powers to direct. (1) While a trust is revocable, the trustee may follow a direction of the settlor that is contrary to the terms of the trust.

If the terms of a trust confer upon a person other than the settlor of a revocable trust power to direct certain actions of the trustee, the trustee shall act in accordance with an exercise of the power unless the exercise is manifestly contrary to the terms of the trust or the trustee knows the attempted exercise would constitute a serious breach of a fiduciary duty that the person holding the power owes to the beneficiaries of the trust.

The terms of a trust may confer upon a trustee or other person a power to direct the modification or termination of the trust.

A person other than a beneficiary who holds a power to direct is rebuttably presumed to be a fiduciary and 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. [2005 c.348 §66] 130.690 UTC 809. Control and protection of trust property. A trustee shall take reasonable steps to take control of and protect the trust property. [2005 c.348 §67] 130.695 UTC 810. Recordkeeping and identification of trust property. (1) A trustee shall keep adequate records of the administration of the trust.

A trustee shall keep trust property separate from the trustee’s own property.

Except as otherwise provided in subsection

of this section, a trustee shall cause the trust property to be designated so that the interest of the trust, to the extent feasible, appears in records maintained by a party other than a trustee or beneficiary.

If the trustee maintains records clearly indicating the respective interests of the different trusts, a trustee may invest as a whole the property of two or more separate trusts. [2005 c.348 §68] 130.700 UTC 811. Enforcement and defense of claims. A trustee shall take reasonable steps to enforce claims of the trust and to defend claims against the trust. [2005 c.348 §69] 130.705 UTC 812. Collecting trust property. A trustee shall take reasonable steps to compel a former trustee or other person to deliver trust property to the trustee, and to remedy a breach of trust known to the trustee to have been committed by a former trustee. [2005 c.348 §70] 130.710 UTC 813. Duty to inform and report. (1) A trustee shall keep the qualified beneficiaries of the trust reasonably informed about the administration of the trust and of the material facts necessary for those beneficiaries to protect their interests. If reasonable under the circumstances, a trustee may respond to a request for information related to the administration of the trust from a beneficiary who is not a qualified beneficiary.

Upon request of a qualified beneficiary, a trustee shall promptly furnish to the qualified beneficiary a copy of the trust instrument.

Within a reasonable time after accepting a trusteeship, a trustee shall notify all qualified beneficiaries of the acceptance and of the trustee’s name, address and telephone number.

Except as provided in subsection (10) of this section, within a reasonable time after the date the trustee acquires knowledge of the creation of an irrevocable trust, or the date the trustee acquires knowledge that a formerly revocable trust has become irrevocable, whether by the death of the settlor or otherwise, the trustee shall notify the qualified beneficiaries of the trust’s existence, of the identity of the settlor or settlors, of the right to request a copy of the trust instrument and of the right to a trustee’s report as provided in subsection (3) of this section.

A trustee shall notify the qualified beneficiaries in advance of any change in the method or rate of the trustee’s compensation.

Except as provided in subsection

of this section, a trustee shall send a trustee report, at least annually and upon termination of the trust, to the permissible distributees of trust income or principal and to other qualified beneficiaries who request the report. The report must include a listing of trust property and liabilities, and must show the market values of trust assets, if feasible. The report must reflect all receipts and disbursements of the trust, including the source and amount of the trustee’s compensation.

Upon a vacancy in a trusteeship, unless a cotrustee remains in office, and if required by the successor trustee or the court, the former trustee shall send a trustee report for the period from the prior report, if any, through the time of vacancy to the qualified beneficiaries of the trust.

A personal representative, conservator or guardian may send the qualified beneficiaries a trustee report on behalf of a deceased or financially incapable trustee.

A qualified beneficiary may waive the right to a trustee report or other information otherwise required to be furnished under this section. A qualified beneficiary may withdraw a waiver at any time for the purpose of future reports and other information.

A trustee may charge a reasonable fee to a beneficiary for providing information under this section.

A beneficiary’s request for any information under this section must be with respect to a single trust that is sufficiently identified to enable the trustee to locate the trust’s records.

If the trustee is bound by any confidentiality restrictions regarding a trust asset, any beneficiary eligible under this section to receive information about that asset must agree to be bound by the same confidentiality restrictions before receiving the information.

Despite any other provision of this section, information, notice and reports required by this section shall be given only to the settlor’s spouse if:

The spouse survives the settlor;

The spouse is financially capable;

The spouse is the only permissible distributee of the trust; and

All of the other qualified beneficiaries of the trust are descendants of the spouse.

Notwithstanding any other provision of this section, while the settlor of a revocable trust is alive, beneficiaries other than the settlor have no right to receive notice, information or reports under this section.

A trustee need not provide a qualified beneficiary with the notice of the right to a trustee’s report under subsection (2)(c) of this section, and need not send trustee reports to the beneficiary under subsection (3) of this section, until six months after a revocable trust becomes irrevocable if the beneficiary’s only interest in the trust is a distribution of a specific item of property or distribution of a specific amount of money. The trustee must provide the notice of the right to a trustee’s report required by subsection

of this section at the end of the six-month period if the beneficiary has not received distribution of the specific item of property or specific amount of money before the end of the period. If notice is provided to a qualified beneficiary under this subsection, the trustee must thereafter send trustee reports to the beneficiary until distribution of the specific item of property or specific amount of money. [2005 c.348 §71; 2009 c.275 §18; 2013 c.529 §19]

provides: Sec. 72. (1) Section 71 (2)(b) of this 2005 Act [130.710 (2)(b)] applies only to a trustee who accepts a trusteeship on or after the effective date of this 2005 Act [January 1, 2006].

Section 71 (2)(c) of this 2005 Act [130.710 (2)(c)] applies only to irrevocable trusts created on or after the effective date of this 2005 Act and to revocable trusts that become irrevocable on or after the effective date of this 2005 Act. [2005 c.348 §72]

provides: Sec. 19. The amendments to ORS 130.710 by section 18 of this 2009 Act apply only to revocable trusts that become irrevocable on or after the effective date of this 2009 Act [January 1, 2010]. [2009 c.275 §19] 130.715 UTC 814. Discretionary powers; tax savings; inclusion of capital gains in income. (1) A trustee shall exercise a discretionary power in good faith and in a manner that is in accordance with the terms and purposes of the trust and the interests of the beneficiaries. The duty imposed by this subsection is not affected by the grant of discretion in the terms of the trust, even though the terms of the trust provide that the trustee has absolute, sole or uncontrolled discretion or use other words purporting to convey broad discretion.

Subject to subsection (4) of this section, and unless the terms of the trust expressly provide otherwise:

A person other than a settlor who is a beneficiary and trustee of a trust that confers on the trustee a power to make discretionary distributions to or for the trustee’s personal benefit may exercise the power only in accordance with an ascertainable standard; and

A trustee may not exercise a power to make discretionary distributions to satisfy a legal obligation of support that the trustee personally owes another person.

A power the exercise of which is limited or prohibited by subsection (2) of this section may be exercised by a majority of the remaining trustees whose exercise of the power is not so limited or prohibited. If the power of all trustees is so limited or prohibited, the court may appoint a special fiduciary with authority to exercise the power.

Subsection (2) of this section does not apply to:

A power held by the settlor’s spouse who is the trustee of a trust for which a marital deduction, as described in section 2056(b)(5) or 2523(e) of the Internal Revenue Code, as in effect on January 1, 2006, was previously allowed;

Any trust during any period that the trust may be revoked or amended by its settlor; or

A trust if contributions to the trust qualify for the annual exclusion under section 2503(c) of the Internal Revenue Code, as in effect on January 1, 2006.

Unless otherwise provided by the trust, a trustee may include capital gains from the sale or exchange of capital assets in distributable net income to the extent that the gains are, in a reasonable and impartial exercise of discretion by the trustee:

Allocated to income pursuant to the trustee’s power to adjust between principal and income under ORS 129.215;

Allocated to principal and treated consistently by the trustee on the trust’s books, records and tax returns as part of a distribution to a beneficiary; or

Allocated to principal but actually distributed to a beneficiary or utilized by the trustee in determining the amount that is distributed or required to be distributed to a beneficiary. [2005 c.348 §73; 2015 c.126 §3]

130.720 UTC 815. General powers of trustee. (1) A trustee, without authorization by the court, may exercise powers conferred by the terms of the trust and, except as limited by the terms of the trust:

All powers over the trust property that an unmarried financially capable owner has over individually owned property;

Any other powers appropriate to achieve the proper investment, management and distribution of the trust property; and

Any other powers conferred by this chapter.

The exercise of a power is subject to the fiduciary duties prescribed by ORS 130.650 to 130.730. [2005 c.348 §74] 130.725 UTC 816. Specific powers of trustee. Without limiting the authority conferred by ORS 130.720, a trustee may do any of the following:

Collect trust property and accept or reject additions to the trust property from a settlor or any other person.

Acquire or sell property, for cash or on credit, at public or private sale.

Exchange, partition or otherwise change the character of trust property.

Deposit trust money in an account in a financial institution, including a financial institution operated by the trustee, if the deposit is adequately insured or secured.

Borrow money, with or without security, to be repaid from trust assets or otherwise, and advance money for the protection of the trust and for all expenses, losses and liabilities sustained in the administration of the trust or because of the holding or ownership of any trust assets. Money may be borrowed under this subsection from any lender, including a financial institution operated by or affiliated with the trustee. A trustee is entitled to be reimbursed out of the trust property or from property that has been distributed from the trust, with reasonable interest, for an advance of money under this subsection.

Continue operation of any proprietorship, partnership, limited liability company, business trust, corporation or other form of business or enterprise in which the trust has an interest, and take any action that may be taken by shareholders, members or property owners, including merging, dissolving or otherwise changing the form of business organization or contributing additional capital.

Exercise the rights of an absolute owner of stocks and other securities, including the right to:

Vote, or give proxies to vote, with or without power of substitution, or enter into or continue a voting trust agreement;

Hold a security in the name of a nominee or in other form without disclosure of the trust so that title may pass by delivery;

Pay calls, assessments and other sums chargeable or accruing against the securities, and sell or exercise stock subscription or conversion rights; and

Deposit the securities with a depository or other financial institution.

Construct, repair, alter or otherwise improve buildings or other structures on real property in which the trust has an interest, demolish improvements, raze existing or erect new party walls or buildings on real property in which the trust has an interest, subdivide or develop land, dedicate land to public use or grant public or private easements, and make or vacate plats and adjust boundaries.

Enter into a lease for any purpose as lessor or lessee, including a lease or other arrangement for exploration and removal of natural resources, with or without the option to purchase or renew, even though the period of the lease extends beyond the duration of the trust.

Grant an option involving a sale, lease or other disposition of trust property or acquire an option for the acquisition of property, even though the option is exercisable after the trust is terminated, and exercise an option so acquired.

Insure the property of the trust against damage or loss and insure the trustee, the trustee’s agents, and beneficiaries against liability arising from the administration of the trust.

Abandon or decline to administer property of no value or property of a value that is not adequate to justify its collection or continued administration.

Avoid possible liability for violation of environmental law by:

Inspecting or investigating property the trustee holds or has been asked to hold, or property owned or operated by an organization in which the trustee holds or has been asked to hold an interest, for the purpose of determining the application of environmental law with respect to the property;

Taking action to prevent, abate or otherwise remedy any actual or potential violation of any environmental law affecting property held directly or indirectly by the trustee, whether taken before or after the assertion of a claim or the initiation of governmental enforcement;

Declining to accept property into trust or disclaiming any power with respect to property that is or may be burdened with liability for violation of environmental law;

Compromising claims against the trust that may be asserted for an alleged violation of environmental law; and

Paying the expense of any inspection, review, abatement or remedial action to comply with environmental law.

Pay or contest any claim, settle a claim by or against the trust, and release, in

whole or in part, a claim belonging to the trust.

Pay taxes, assessments, compensation of the trustee and of employees and agents of the trust, and other expenses incurred in the administration of the trust.

Exercise elections available under federal, state and local tax laws.

Select a mode of payment under any employee benefit or retirement plan, annuity or life insurance payable to the trustee, exercise rights under employee benefit or retirement plans, annuities or policies of life insurance, including exercise of the right to indemnification for expenses and against liabilities, and take appropriate action to collect the proceeds.

Make loans out of trust property. The trustee may make a loan to a beneficiary on terms and conditions the trustee considers to be fair and reasonable under the circumstances. The trustee may collect loans made to a beneficiary by making deductions from future distributions to the beneficiary.

Pledge trust property to guarantee loans made by others to the beneficiary.

Appoint a trustee to act in another state, country or other jurisdiction with respect to trust property located in the other state, country or other jurisdiction, confer upon the appointed trustee all of the powers and duties of the appointing trustee, require that the appointed trustee furnish security and remove any trustee so appointed.

Make a distribution to a beneficiary who is under a legal disability or who the trustee reasonably believes is financially incapable, either:

Directly;

By application of the distribution for the beneficiary’s benefit;

By paying the distribution to the beneficiary’s conservator or, if the beneficiary does not have a conservator, the beneficiary’s guardian;

By creating a custodianship under the Uniform Transfers to Minors Act by paying the distribution to a custodian for the beneficiary;

By paying the distribution to any existing custodian under the Uniform Transfers to Minors Act;

By paying the distribution to an adult relative or other person having legal or physical care or custody of the beneficiary, to be expended on the beneficiary’s behalf, if the trustee does not know of a conservator, guardian or custodian for the beneficiary; or

By managing the distribution as a separate fund held by the trustee on behalf of the beneficiary, subject to the beneficiary’s continuing right to withdraw the distribution.

On distribution or payment of trust property or the division or termination of a trust, make distributions and payments in cash or in kind, or in divided or undivided interests, allocate particular assets in proportionate or disproportionate shares, value the trust property for those purposes and adjust for resulting differences in valuation.

Resolve a dispute concerning the interpretation of the trust or the administration of the trust by mediation, arbitration or other procedure for alternative dispute resolution.

Prosecute or defend an action, claim or judicial proceeding in any state, country or other jurisdiction to protect trust property and the trustee in the performance of the trustee’s duties.

Sign and deliver contracts and other instruments that are useful to achieve or facilitate the exercise of the trustee’s powers.

On termination of the trust, exercise the powers appropriate to wind up the administration of the trust and distribute the trust property to the persons entitled to the property.

Allocate items of income or expense to either trust income or principal, as provided by law, including creation of reserves out of income for depreciation, obsolescence or amortization, or for depletion in mineral or timber properties.

Employ persons, including attorneys, auditors, investment advisors or agents, to advise or assist the trustee in the performance of administrative duties. A trustee may act based on the recommendations of professionals without independently investigating the recommendations.

Apply for and qualify all or part of the property in the trust estate for special governmental tax programs or other programs that may benefit the trust estate or any of the beneficiaries.

Deposit securities in a clearing corporation as provided in ORS 128.100. [2005 c.348 §75; 2007 c.515 §3; 2013 c.529 §20] 130.730 UTC 817. When interest of beneficiary vests; distribution upon termination.

The interests of a beneficiary under a testamentary trust vest upon the death of the testator, and the interests of a beneficiary under a revocable or irrevocable trust vest when the trust becomes irrevocable, and not later, unless the will or trust clearly indicates a contrary intent.

Unless a will or trust clearly indicates a contrary intent, upon the occurrence

of an event, satisfaction of a condition or exercise of a power that terminates or partially terminates a trust or creates an obligation for the trustee to pay or distribute all or any portion of a trust to a beneficiary, the beneficiary’s interest in the terminated trust, portion or distribution indefeasibly vests in the beneficiary as of the event, satisfaction or exercise, subject to ORS 114.600 to 114.725, rights of creditors and the administration and sale of trust property by the trustee. Upon the termination or partial termination of a trust or upon creation of the obligation for the trustee to pay or distribute all or any portion of a trust to a beneficiary under this subsection, the trustee shall proceed expeditiously to distribute the trust property to the persons entitled to the property. The trustee may retain a reasonable reserve for the payment of debts, fees, expenses and taxes.

Incidental to a termination or partial termination of a trust, the trustee may request that a beneficiary execute a release of the trustee from liability for breach of trust. A release under this subsection is invalid to the extent:

The release was induced by improper conduct of the trustee; or

The trustee failed to adequately disclose to the beneficiary, at the time of the release, the material facts relating to the breach or sufficient information to enable the beneficiary to know of a potential claim or to inquire into the existence of a breach or potential claim. [2005 c.348 §76; 2013 c.529 §21; 2015 c.126 §4]

130.733 Notice of proposed trustee action to beneficiaries; right of beneficiary to object. (1) Prior to a proposed action to be taken by a trustee regarding the administration of a trust, the trustee may send the beneficiaries a written notice of the proposed action informing the beneficiaries of the proposed action.

The right of a beneficiary receiving a notice of proposed action under subsection

of this section to object to a proposed action described in the notice is barred if the beneficiary does not notify the trustee in writing of an objection within 45 days after the notice was sent, or within such longer time as may be stated in the notice, but only to the extent that the notice of proposed action:

Clearly informs the beneficiary of the right to object, the manner in which to object and the date by which the objection must be received by the trustee;

States that the beneficiary’s right to object may be barred if the beneficiary does not object within the time and in the manner allowed for objection; and

Adequately provides sufficient information regarding the proposed action to enable the beneficiary to make an informed decision.

If a beneficiary receiving notice does not object as provided in this section, the beneficiary will be deemed to have consented to the proposed action and the beneficiary may not thereafter file an action or other civil proceeding based in tort, contract or otherwise if the proposed action is taken by the trustee within a reasonable time after the notice was given under this section. This subsection does not apply to the following:

Allowance of the trustee’s compensation;

Settlement of trust accounts or the trustee’s report;

Sale of trust property to the trustee or sale of the trustee’s property to the trust;

Exchange of trust property for property of the trustee;

Grant of an option to the trustee to purchase trust property;

Allowance, payment or settlement of a trustee’s claim against the trust;

Compromise or settlement of a claim, action or proceeding by the trust against the trustee; or

Extension, renewal or modification of the terms of a debt or other obligation of the trustee owing to or in favor of the trust.

The receipt of an objection by the trustee does not prohibit the trustee from taking the proposed action or sending subsequent notices of proposed actions to the beneficiaries regarding the same or similar proposed actions. [2013 c.529 §25]

130.735 Appointment of adviser; liability of trustee. (1) A trust instrument may appoint a person to act as an adviser for the purpose of directing or approving decisions made by the trustee, including decisions related to distribution of trust assets and to the purchase, sale or exchange of trust investments. The appointment must be made by a provision of the trust that specifically refers to this section. The appointment may provide for succession of advisers and for a process for the removal of advisers. An adviser shall exercise all authority granted under the trust instrument as a fiduciary unless the trust instrument provides otherwise. A person who agrees to act as an adviser is subject to Oregon law and submits to the jurisdiction of the courts of this state.

If a trust instrument provides that a trustee is to follow the direction of an adviser, and that trustee acts in accordance with the adviser’s directions, the trustee is not liable for any loss resulting directly or indirectly from the trustee’s decision unless the decision constitutes reckless indifference to the purposes of the trust or the interests of the beneficiaries.

If a trust instrument provides that a trustee is to make decisions with the approval of an adviser, and the adviser does not provide approval within a reasonable time after the trustee has made a request for approval of a decision, the trustee is not liable for any loss resulting directly or indirectly from the decision unless the decision constitutes reckless indifference to the purposes of the trust or the interests of the beneficiaries.

Except to the extent specifically provided by the trust instrument, a trustee has no duty to monitor an adviser’s conduct, provide advice to the adviser, consult with the adviser or give notice to any beneficiary or third party about decisions made pursuant to the adviser’s direction that the trustee would have decided differently.

Absent clear and convincing evidence to the contrary, all actions taken by a trustee for the purpose of implementing directions from an adviser, including confirming that the adviser’s directions have been carried out and recording and reporting activities requested by the adviser, are presumed to be administrative actions taken by the trustee solely for the purpose of allowing the trustee to perform the duties assigned to the trustee under the trust instrument. Administrative actions taken by a trustee for the purpose of implementing directions from an adviser do not constitute monitoring of the adviser or other participation in decisions that are within the scope of the adviser’s authority.

A court may remove an adviser if the court finds:

The adviser has committed a serious breach of trust; or

Removal of the adviser best serves the interests of the beneficiaries because the adviser is unfit or unwilling, or has persistently failed to timely and effectively advise the trustee in matters assigned to the adviser in the trust instrument under subsection (1) of this section. [2009 c.275 §21; 2013 c.529 §22]

130.750 Trustee’s duty to comply with prudent investor rule. (1) Except as otherwise provided in subsection (2) of this section, a trustee who invests and manages trust assets owes a duty to the beneficiaries of the trust to comply with the prudent investor rule set forth in ORS 130.755.

The prudent investor rule is a default rule that may be expanded, restricted, eliminated or otherwise altered by the provisions of a trust. A trustee is not liable to a beneficiary to the extent that the trustee acted in reasonable reliance on the provisions of the trust. [2005 c.348 §77] 130.755 Prudent investor rule. (1) A trustee shall invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill and caution.

A trustee’s investment and management decisions respecting individual assets are not evaluated in isolation, but in the context of the trust portfolio as a whole and as a part of the overall investment strategy having risk and return objectives reasonably suited to the trust.

A trustee shall consider all relevant circumstances in investing and managing trust assets, including any of the following that are relevant to the trust or the beneficiaries of the trust:

General economic conditions;

The possible effect of inflation or deflation;

The expected tax consequences of investment decisions or strategies;

The role that each investment or course of action plays within an overall trust portfolio, which may include financial assets, interests in closely held enterprises, tangible and intangible personal property, and real property;

The expected total return from income and the appreciation of capital;

Other resources of the beneficiaries;

Needs for liquidity, regularity of income and preservation or appreciation of capital;

An asset’s special relationship or special value, if any, to the purposes of the trust or to one or more of the beneficiaries;

The intent, desire and personal values of the settlor, including the settlor’s desire to engage in sustainable or socially responsible investment strategies that align with the settlor’s social, environmental, governance or other values or beliefs to the extent known by the trustee; and

The needs of the beneficiaries, including but not limited to the beneficiaries’ personal values and desire that the trustee engage in sustainable or socially responsible investing strategies that align with the

beneficiaries’ social, environmental, governance or other values or beliefs, as well as the financial needs of the beneficiaries.

A trustee shall make a reasonable effort to verify facts relevant to the investment and management of trust assets.

A trustee may invest in any kind of property or type of investment consistent with the standards of ORS 130.750 to 130.775.

A trustee who has special skills or expertise, or is named trustee in reliance upon the trustee’s representation that the trustee has special skills or expertise, has a duty to use those special skills or expertise in investing and managing trust assets. [2005 c.348 §78; 2019 c.546 §2] 130.760 Diversification of trust investments. A trustee shall diversify the investments of the trust unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversifying. [2005 c.348 §79] 130.765 Trustee duty. Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee shall review the trust assets and make and implement decisions concerning the retention and disposition of assets in order to bring the trust portfolio into compliance with the requirements of ORS 130.750 to 130.775 and with the purposes, terms, distribution requirements and other circumstances of the trust. [2005 c.348 §80] 130.770 Determination of compliance with prudent investor rule. Compliance with the prudent investor rule is determined in light of the facts and circumstances existing at the time of a trustee’s decision or action and not by hindsight. [2005 c.348 §81] 130.775 Trust language authorizing investments permitted under prudent investor rule. Unless otherwise limited or modified, the following terms or comparable language in the provisions of a trust authorize any investment or strategy permitted under ORS 130.750 to 130.775: “investments permissible by law for investment of trust funds,” “legal investments,” “authorized investments,” “using the judgment and care under the circumstances then prevailing that persons of prudence, discretion and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital,” “prudent man rule,” “prudent trustee rule” and “prudent investor rule.” [2005 c.348 §82]

130.800 UTC 1001. Remedies for breach of trust. (1) A violation by a trustee of a duty the trustee owes to a beneficiary is a breach of trust. A breach of trust may occur by reason of an action or by reason of a failure to act.

To remedy a breach of trust that has occurred or to prevent a breach of trust, the court may:

Compel the trustee to perform the trustee’s duties;

Enjoin the trustee from committing a breach of trust;

Compel the trustee to pay money or restore property;

Order a trustee to account;

Appoint a special fiduciary to take possession of the trust property and administer the trust;

Suspend the trustee;

Remove the trustee as provided in

Reduce or deny compensation to the trustee;

Subject to ORS 130.855, void an act of the trustee, impose a lien or a constructive trust on trust property, or trace trust property wrongfully disposed of and recover the property or its proceeds; or

Order any other appropriate relief. [2005 c.348 §83] 130.805 UTC 1002. Damages for breach of trust. (1) A trustee who commits a breach of trust is liable to the beneficiaries affected for the greatest of:

The amount of damages caused by the breach;

The amount required to restore the value of the trust property and trust distributions to what they would have been had the breach not occurred; or

The profit the trustee made by reason of the breach.

Except as otherwise provided in this subsection, if more than one trustee is liable to the beneficiaries for a breach of trust, a trustee is entitled to contribution from the other trustee or trustees. In determining the amount of contribution, the court shall consider the degree of fault of each trustee and whether any trustee or trustees acted in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries. A trustee who received a benefit from the breach of trust is not entitled to contribution from another trustee to the extent of the benefit received. [2005 c.348 §84; 2017 c.17 §6] 130.810 UTC 1003. Damages in absence of breach. (1) Except as provided by ORS 130.725 (4) and (15) or 709.175 or other law of this state, a trustee is accountable to an affected beneficiary for any profit made by the trustee arising from the administration of the trust, without regard to whether the profit resulted from a breach of trust.

Unless there is a breach of trust, a trustee is not liable to a beneficiary for a loss or depreciation in the value of trust property or for not having made a profit. [2005 c.348 §85] 130.815 UTC 1004. Attorney fees and costs. In a judicial proceeding involving the validity or administration of a trust, the court may award costs and expenses and reasonable attorney’s fees to any party, to be paid by another party or from the trust. [2005 c.348 §86] 130.820 UTC 1005. Limitation of action against trustee. (1) Notwithstanding ORS chapter 12 or any other provision of law, but subject to subsection (2) of this section, a civil action against a trustee based on any act or omission of the trustee, whether based in tort, contract or other theory of recovery, must be commenced within six years after the date the act or omission is discovered, or six years after the date the act or omission should have been discovered, whichever is earlier.

A beneficiary may not commence a proceeding against a trustee more than one year after the date the beneficiary or a representative of the beneficiary is sent a report by certified or regular mail that adequately discloses the existence of a potential claim and that informs the beneficiary of the time allowed for commencing a proceeding. A copy of this section must be attached to the report. The report must provide sufficient information so that the beneficiary or representative knows of the potential claim or should have inquired into its existence.

If subsections (1) and (2) of this section do not apply, a judicial proceeding against a trustee must be commenced within 10 years from the date of the act or omission complained of, or two years from the termination of any fiduciary account established under the trust, whichever is later. [2005 c.348 §87] 130.825 UTC 1006. Reliance on trust instrument. A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from the reliance. [2005 c.348 §88] 130.830 UTC 1007. Event affecting administration or distribution. A trustee is not liable for failing to determine whether a marriage, a divorce, a death, the performance of educational requirements or another event affecting the administration or distribution of a trust has occurred if the trustee has exercised reasonable care in attempting to determine whether the event has occurred. [2005 c.348 §89] 130.835 UTC 1008. Exculpation of trustee.

A term of a trust relieving a trustee of liability for breach of trust is unenforceable to the extent that the term:

Relieves the trustee of liability for breach of trust committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries; or

Was inserted as the result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.

An exculpatory term drafted or caused to be drafted by the trustee is invalid as an abuse of a fiduciary or confidential relationship unless:

The settlor is represented by an independent counsel who reviewed the term; or

The trustee proves that the exculpatory term is fair under the circumstances and that the term’s existence and contents were adequately communicated to the settlor. [2005 c.348 §90] 130.840 UTC 1009. Beneficiary’s consent, release or ratification. If a beneficiary consents to conduct of a trustee that constitutes a breach of trust, releases a trustee from liability for a breach of trust or ratifies a transaction entered into by a trustee that constitutes a breach of trust, the trustee is not liable to the beneficiary for the breach of trust unless:

The consent, release or ratification of the beneficiary was induced by improper conduct of the trustee; or

At the time of the consent, release or ratification, the beneficiary did not know of the beneficiary’s rights or know of the material facts relating to the breach. [2005 c.348 §91] 130.845 UTC 1010. Limitation on personal liability of trustee. (1) Except as otherwise provided in the contract, a trustee is not personally liable on a contract properly entered into in the trustee’s fiduciary capacity in the course of administering the trust if the trustee disclosed the trustee’s fiduciary capacity in the contract.

A trustee is personally liable for torts committed in the course of administering a trust or for obligations arising from ownership or control of trust property, including

liability for violation of environmental law, only if the trustee is personally at fault.

The following claims may be asserted in a judicial proceeding against the trustee in the trustee’s fiduciary capacity, whether or not the trustee is personally liable for the claim:

A claim based on a contract entered into by a trustee in the trustee’s fiduciary capacity.

A claim based on an obligation arising from ownership or control of trust property.

A claim based on a tort committed in the course of administering a trust.

This section does not impose personal liability on a trustee solely because the trustee holds property under an instrument that shows title in the name of the trustee but does not state that the trustee holds the property in a representative capacity. [2005 c.348 §92] 130.850 UTC 1011. Interest as general partner. (1) Except as otherwise provided in subsection (3) of this section or unless personal liability is imposed in the contract, a trustee who holds an interest as a general partner in a general or limited partnership is not personally liable on a contract entered into by the partnership after the trust’s acquisition of the interest if the trustee’s fiduciary capacity is disclosed.

Except as otherwise provided in subsection

of this section, a trustee who holds an interest as a general partner is not personally liable for torts committed by the partnership or for obligations arising from ownership or control of the interest unless the trustee is personally at fault.

The immunity provided by this section does not apply if an interest in a partnership is held by the trustee in a capacity other than that of trustee.

If the trustee of a revocable trust holds an interest as a general partner, the settlor is personally liable for contracts and other obligations of the partnership to the same extent that the settlor would be liable if the settlor were a general partner. [2005 c.348 §93] 130.855 UTC 1012. Protection of person dealing with trustee. (1) A person other than a beneficiary who in good faith assists a trustee, or who in good faith and for value deals with a trustee, is not liable for acts of the trustee that exceed the trustee’s powers or for the improper exercise of the trustee’s powers, unless the person knows that the trustee has exceeded the trustee’s powers or improperly exercised those powers.

A person other than a beneficiary who deals with a trustee in good faith is not required to inquire about the extent of the trustee’s powers or about the propriety of the trustee’s exercise of those powers.

A person who in good faith delivers assets to a trustee need not ensure that the assets are properly applied.

Any person other than a beneficiary who in good faith assists a former trustee, or who in good faith and for value deals with a former trustee, without knowledge that the trusteeship has terminated, is not liable solely because the former trustee is no longer a trustee.

Comparable protective provisions of other laws relating to commercial transactions or transfer of securities by fiduciaries prevail over the protection provided by this section. [2005 c.348 §94] 130.860 UTC 1013. Certification of trust. (1) A person who is not a beneficiary and who proposes to deal with the trustee of a trust may require that all trustees execute and furnish to the person a certification of trust.

The certification of trust shall contain the following information:

That the trust exists and the date the trust instrument was executed;

The identity of the settlor;

The identity and address of the currently acting trustee;

The powers of the trustee;

The revocability or irrevocability of the trust and the identity of any person holding a power to revoke the trust;

The existence or nonexistence of any power to modify or amend the trust and the identity of any person holding a power to modify or amend the trust;

The authority of cotrustees to sign or otherwise authenticate and whether all cotrustees or fewer than all are required in order to exercise powers of the trustee;

The last four digits of the settlor’s Social Security number, or the trust’s employer identification number;

The manner of taking title to trust property; and

The state, country or other jurisdiction under the laws of which the trust was established.

A certification of trust must be signed or otherwise authenticated by all the trustees.

A certification of trust must state that the trust has not been revoked, modified or amended in any manner that would cause

the representations contained in the certification of trust to be incorrect.

A certification of trust need not contain the dispositive terms of a trust.

A recipient of a certification of trust may not require the trustee to furnish the entire trust instrument, but may require the trustee to furnish copies of excerpts from the original trust instrument and later amendments that designate the trustee and confer upon the trustee the power to act in the pending transaction.

A person may require that the certification of trust:

Include facts other than those listed in this section that are reasonably related to the administration of the trust;

Be executed by one or more of the settlors;

Be executed by one or more of the beneficiaries if the certification is reasonably related to a pending or contemplated transaction with the person; and

Be adapted to the person’s own standard form, which may be incorporated in an account signature agreement or other account document.

A certification of trust may contain the identity of any successor trustee or trustees and the circumstances under which any successor trustee or trustees will assume trust powers.

A person who acts in reliance upon a certification of trust without actual knowledge that the representations contained in the certification are incorrect is not liable to any person for so acting and may assume without inquiry the existence of the facts contained in the certification. A person does not have actual knowledge that the representations contained in the certification are incorrect solely by reason of having a copy of all or part of the trust instrument.

Any transaction, and any lien created by that transaction, is enforceable against a trust if the transaction is entered into by a person acting in reliance on a certification of trust containing the information set forth in this section without actual knowledge that the representations contained in the certification are incorrect.

If a person has actual knowledge that the trustee or trustees are acting outside the scope of the trust, and the actual knowledge was acquired by the person before entering into the transaction or making a binding commitment to do so, the transaction is not enforceable against the trust.

A person is not liable for acting in reliance on a certification of trust solely because the certification fails to contain all the information required in this section.

This section does not limit the rights of the beneficiaries of the trust against a trustee.

A person’s failure to demand or refusal to accept and rely solely upon a certification of trust does not affect the protection provided the person by ORS 130.855, and no inference as to whether the person has acted in good faith may be drawn from the failure to demand or the refusal to accept and rely solely upon a certification.

This section applies to all trusts, whether established under the laws of this state or under the law of another state, country or other jurisdiction. [2005 c.348 §95; 2009 c.363 §3]

130.900 Uniformity of application and construction. In applying and construing ORS chapter 130, consideration must be given to the need to promote uniformity of the law with respect to trusts among states that enact the Uniform Trust Code. [2005 c.348 §96]

the Legislative Assembly but were not added to or made a part of ORS chapter 130 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation. 130.905 UTC 1102. Electronic records and signatures. The legal effect, validity or enforceability of electronic records or electronic signatures under ORS chapter 130, and of contracts formed or performed with the use of such records or signatures, are governed by ORS 84.001 to 84.061.

130.910 UTC 1106. Application. (1) Except as otherwise provided in ORS chapter 130:

ORS chapter 130 applies to all trusts created before, on or after January 1, 2006.

ORS chapter 130 does not apply to judicial, administrative and other proceedings concerning trusts commenced before January 1, 2006.

Any rule of construction or presumption provided in ORS chapter 130 applies to trust instruments executed before January 1, 2006, unless there is a clear indication of a contrary intent in the terms of the trust.

An act done before January 1, 2006, is not affected by ORS chapter 130.

If a right is acquired, extinguished or barred upon the expiration of a prescribed period that has commenced to run under any other statute before January 1, 2006, that statute continues to apply to the right even

if it has been repealed or superseded. c.348 §98]

[2005 Note: See note under 130.900.