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Powers of Trustees
Powers of Trustees
700.7102 Scope.
Sec. 7102. This article applies to trusts as defined in section 1107.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
700.7103 Definitions.
Sec. 7103. As used in this article:
(a) "Action", with respect to a trustee, includes an act or a failure to act.
(b) "Ascertainable standard" means a standard relating to an individual's health, education, support, or
maintenance within the meaning of section 2041(b)(1)(A) or 2514(c)(1) of the internal revenue code of 1986,
26 USC 2041 and 2514.
(c) "Charitable trust" means a trust, or portion of a trust, created for a charitable purpose described in
section 7405(1).
(d) "Discretionary trust provision" means a provision in a trust, regardless of whether the terms of the trust
provide a standard for the exercise of the trustee's discretion and regardless of whether the trust contains a
spendthrift provision, that provides that the trustee has discretion, or words of similar import, to determine 1
or more of the following:
(i) Whether to distribute to or for the benefit of an individual or a class of beneficiaries the income or
principal or both of the trust.
(ii) The amount, if any, of the income or principal or both of the trust to distribute to or for the benefit of
an individual or a class of beneficiaries.
(iii) Who, if any, among a class of beneficiaries will receive income or principal or both of the trust.
(iv) Whether the distribution of trust property is from income or principal or both of the trust.
(v) When to pay income or principal, except that a power to determine when to distribute income or
principal within or with respect to a calendar or taxable year of the trust is not a discretionary trust provision
if the distribution must be made.
(e) "Interests of the trust beneficiaries" means the beneficial interests provided in the terms of the trust.
(f) "Power of withdrawal" means a presently exercisable general power of appointment other than a power
that is either of the following:
(i) Exercisable by a trustee and limited by an ascertainable standard.
(ii) Exercisable by another person only on consent of the trustee or a person holding an adverse interest.
(g) "Qualified trust beneficiary" means a trust beneficiary to whom 1 or more of the following apply on the
date the trust beneficiary's qualification is determined:
(i) The trust beneficiary is a distributee or permissible distributee of trust income or principal.
(ii) The trust beneficiary would be a distributee or permissible distributee of trust income or principal if the
interests of the distributees under the trust described in subparagraph (i) terminated on that date without
causing the trust to terminate.
(iii) The trust beneficiary would be a distributee or permissible distributee of trust income or principal if
the trust terminated on that date.
(h) "Revocable", as applied to a trust, means revocable by the settlor without the consent of the trustee or a
person holding an adverse interest. A trust's characterization as revocable is not affected by the settlor's lack
of capacity to exercise the power of revocation, regardless of whether an agent of the settlor under a durable
power of attorney, a conservator of the settlor, or a plenary guardian of the settlor is serving.
(i) "Settlor" means a person, including a testator or a trustee, who creates a trust. If more than 1 person
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creates a trust, each person is a settlor of the portion of the trust property attributable to that person's
contribution. The lapse, release, or waiver of a power of appointment does not cause the holder of a power of
appointment to be treated as a settlor of the trust.
(j) "Spendthrift provision" means a term of a trust that restrains either the voluntary or involuntary transfer
of a trust beneficiary's interest.
(k) "Support provision" means a provision in a trust that provides the trustee shall distribute income or
principal or both for the health, education, support, or maintenance of a trust beneficiary, or language of
similar import. A provision in a trust that provides a trustee has discretion whether to distribute income or
principal or both for these purposes or to select from among a class of beneficiaries to receive distributions
under the trust provision is not a support provision, but rather is a discretionary trust provision.
(l) "Trust beneficiary" means a person to whom 1 or both of the following apply:
(i) The person has a present or future beneficial interest in a trust, vested or contingent.
(ii) The person holds a power of appointment over trust property in a capacity other than that of trustee or
trust director.
(m) "Trust director" means that term as defined in section 7703a.
(n) "Trust instrument" means a governing instrument that contains the terms of the trust, including any
amendment to a term of the trust.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010;Am. 2012, Act 483, Imd. Eff. Dec. 28, 2012;
Am. 2018, Act 664, Eff. Mar. 29, 2019.
Popular name: EPIC
700.7105 Duties and powers of trustee; provisions of law prevailing over terms of trust.
Sec. 7105. (1) Except as otherwise provided in the terms of the trust, this article governs the duties and
powers of a trustee, relations among trustees, and the rights and interests of a trust beneficiary.
(2) The terms of a trust prevail over any provision of this article except the following:
(a) The requirements under sections 7401 and 7402(1)(e) for creating a trust.
(b) Except as otherwise provided in sections 7703a and 7703b, the duty of a trustee to administer a trust in
accordance with section 7801.
(c) The requirement under section 7404 that the trust have a purpose that is lawful, not contrary to public
policy, and possible to achieve.
(d) The power of the court to modify or terminate a trust under sections 7410, 7412(1) to (3), 7414(2),
7415, and 7416.
(e) The effect of a spendthrift provision, a support provision, and a discretionary trust provision on the
rights of certain creditors and assignees to reach a trust as provided in part 5.
(f) The power of the court under section 7702 to require, dispense with, or modify or terminate a bond.
(g) The power of the court under section 7708(2) to adjust a trustee's compensation specified in the terms
of the trust that is unreasonably low or high.
(h) The obligations imposed on a trust director in section 7703a(4) and (5).
(i) The duty under section 7814(2)(a) to (c) to provide beneficiaries with the terms of the trust and
information about the trust's property, and to notify qualified trust beneficiaries of an irrevocable trust of the
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existence of the trust and the identity of the trustee.
(j) The power of the court to order the trustee to provide statements of account and other information under
section 7814(4).
(k) The effect of an exculpatory term under section 7703a(5)(b) or 7908.
(l) The effect of a release of a trustee or trust director from liability for breach of trust under section
7703a(8).
(m) The rights under sections 7910 to 7913 of a person other than a trustee or beneficiary.
(n) Periods of limitation under this article for commencing a judicial proceeding.
(o) The power of the court to take action and exercise jurisdiction.
(p) The subject-matter jurisdiction of the court and venue for commencing a proceeding as provided in
sections 7203 and 7204.
(q) The requirement under section 7113 that a provision in a trust that purports to penalize an interested
person for contesting the trust or instituting another proceeding relating to the trust shall not be given effect if
probable cause exists for instituting a proceeding contesting the trust or another proceeding relating to the
trust.
(r) The requirement under section 7703b(2)(d) regarding the eligibility of a trust's sole beneficiary to be a
separate trustee as that term is defined in section 7703b.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010;Am. 2010, Act 325, Eff. Apr. 1, 2010;Am.
2018, Act 664, Eff. Mar. 29, 2019.
Compiler's note: Enacting section 1 of Act 325 of 2010 provides:
"Enacting section 1. (1) Except as provided in subsection (2), this amendatory act takes effect April 1, 2010.
"(2) Section 3207 of the estates and protected individuals code, 1998 PA 386, MCL 700.3207, as amended by this amendatory act,
takes effect on the date this amendatory act is enacted into law."
Popular name: EPIC
700.7114 Trustee having insurable interest under life insurance policy; conditions.
Sec. 7114. A trustee of a trust has an insurable interest in the life of an individual insured under a life
insurance policy that is owned by the trustee of the trust acting in a fiduciary capacity or that designates the
trust itself as the owner if, on the date the policy is issued, both of the following are true:
(a) The insured is 1 of the following:
(i) A settlor of the trust.
(ii) An individual in whom a settlor of the trust has, or would have had if living at the time the policy was
issued, an insurable interest.
(b) The life insurance proceeds are primarily for the benefit of 1 or more trust beneficiaries that have 1 of
the following:
(i) An insurable interest in the life of the insured.
(ii) A substantial interest engendered by love and affection in the continuation of the life of the insured
and, if not already included under subparagraph (i), who are 1 of the following:
(A) Related within the third degree or closer, as measured by the civil law system of determining degrees
of relation, either by blood or affinity, to the insured.
(B) Stepchildren of the insured.
History: Add. 2014, Act 8, Imd. Eff. Feb. 11, 2014.
Popular name: EPIC
PART 2
JUDICIAL PROCEEDINGS
700.7201 Role of court in administration of trust.
Sec. 7201. (1) A court of this state may intervene in the administration of a trust to the extent its
jurisdiction is invoked by an interested person or as provided by law.
(2) A trust is not subject to continuing judicial supervision unless ordered by the court. Registration of a
trust or another proceeding concerning a trust does not result in continuing judicial supervision unless ordered
by the court. Subject to court jurisdiction as invoked by an interested person or as otherwise exercised as
provided by law, the management and distribution of a trust estate, submission of an account or report to
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beneficiaries, payment of a trustee's fees and other trust obligations, acceptance and change of trusteeship, and
any other aspect of trust administration shall proceed expeditiously consistent with the terms of the trust, free
of judicial intervention, and without court order or approval or other court action.
(3) A proceeding involving a trust may relate to any matter involving the trust's administration, including a
request for instructions and a determination regarding the validity, internal affairs, or settlement of a trust; the
administration, distribution, modification, reformation, or termination of a trust; or the declaration of rights
that involve a trust, trustee, or trust beneficiary, including, but not limited to, proceedings to do any of the
following:
(a) Appoint or remove a trustee.
(b) Review the fees of a trustee.
(c) Require, hear, and settle interim or final accounts.
(d) Ascertain beneficiaries.
(e) Determine a question that arises in the administration or distribution of a trust, including a question of
construction of a trust.
(f) Instruct a trustee and determine relative to a trustee the existence or nonexistence of an immunity,
power, privilege, duty, or right.
(g) Release registration of a trust.
(h) Determine an action or proceeding that involves settlement of an irrevocable trust.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
700.7204 Venue.
Sec. 7204. (1) Except as otherwise provided in subsection (2), venue for a proceeding involving a trust is
as follows:
(a) For a proceeding under section 7203 involving a registered trust, in the place of registration.
(b) For a proceeding under section 7203 involving a trust not registered in this state, in any place where the
trust properly could be registered and, if the trust is created by will and the estate is not yet closed, in the
county in which the decedent's estate is being administered.
(c) As otherwise specified by court rule.
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(2) If a trust has no trustee and has not been registered, venue for a judicial proceeding for the appointment
of a trustee is as follows:
(a) In a county in this state in which a trust beneficiary resides.
(b) In a county in which any trust property is located.
(c) If the trust is created by will, in the county in which the decedent's estate was or is being administered.
(d) As otherwise provided by court rule.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
700.7206 Court; concurrent jurisdiction of litigation involving trusts and third parties.
Sec. 7206. The court where a trust is registered has concurrent jurisdiction with other courts of this state of
an action or proceeding to determine the existence or nonexistence of the trust if created other than by will, of
an action or proceeding against a creditor or debtor of the trust, and of another action or proceeding that
involves a trustee and a third party.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2000, Act 54, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 3
REPRESENTATION
700.7301 Representation; effect.
Sec. 7301. (1) Notice to a person who may represent and bind another person under this part has the same
effect as if notice were given directly to the other person.
(2) The consent of a person who may represent and bind another person under this part is binding on the
person represented unless the person represented objects to the representation before the consent would
otherwise have become effective.
(3) Except as otherwise provided in section 7602, a person who under this part may represent a settlor who
lacks capacity may receive notice and for purposes of section 7602 may give a binding consent on the settlor's
behalf.
(4) A settlor may not represent or bind a trust beneficiary under this part with respect to the termination or
modification of a trust under section 7411(1).
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 4
CREATION, VALIDITY, MODIFICATION, AND TERMINATION OF TRUST
700.7401 Creating trust; methods.
Sec. 7401. (1) A trust may be created by any of the following:
(a) Transfer of property to another person as trustee during the settlor's lifetime or by will or other
disposition taking effect upon the settlor's death.
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(b) Declaration by the owner of property that the owner holds identifiable property as trustee.
(c) Exercise of a power of appointment in favor of a trustee.
(d) Exercise of a power described in section 7820a.
(e) A promise by 1 person to another person, whose rights under the promise are to be held in trust for a
third person.
(2) The instrument establishing the terms of a trust is not rendered invalid because property or an interest
in property is not transferred to the trustee or made subject to the terms of the trust concurrently with the
signing of the instrument. Until property or an interest in property is transferred to the trustee or made subject
to the terms of the trust, the person nominated as trustee has no fiduciary or other obligations under the
instrument establishing the terms of the trust except as may have been specifically agreed by the settlor and
the nominated trustee.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2005, Act 204, Imd. Eff. Nov. 10, 2005;Am. 2009, Act 46, Eff. Apr. 1, 2010;
Am. 2012, Act 483, Imd. Eff. Dec. 28, 2012.
Popular name: EPIC
700.7413 Cy pres.
Sec. 7413. (1) Except as otherwise provided in subsections (2) or (3), if a particular charitable purpose
becomes unlawful, impracticable, or impossible to achieve, no alternative taker is named or provided for, and
the court finds the settlor had a general, rather than a specific, charitable intent, all of the following apply:
(a) The trust does not fail, in whole or in part.
(b) The trust property does not revert to the settlor or the settlor's successors in interest.
(c) The court may apply cy pres to modify or terminate the trust by directing that the trust property be
applied or distributed, in whole or in part, in a manner consistent with the settlor's general charitable intent.
(2) If the terms of a charitable trust confer a power on the trustee, or another person designated in the trust
or gift, to modify or terminate either the charitable trust, a charitable gift to the trust, or the charitable purpose
of the trust or gift in favor of another charitable trust, gift, or purpose, the terms of the trust prevail over the
power of the court to apply cy pres to modify or terminate the trust.
(3) A provision in the terms of a charitable trust that would result in distribution of the trust property to a
noncharitable beneficiary prevails over the power of the court to apply cy pres to modify or terminate the trust
only if, when the provision takes effect, either of the following applies:
(a) The trust property is to revert to the settlor and the settlor is still living.
(b) Less than 50 years have elapsed since the date of the trust's creation.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 5
CREDITOR'S CLAIMS; SPENDTHRIFT, SUPPORT, AND DISCRETIONARY TRUSTS
700.7501 Application; purposes.
Sec. 7501. This part applies to a creditor's or transferee's claims with respect to spendthrift, support, and
discretionary trusts.
History: 1998, Act 386, Eff. Apr. 1, 2000;Am. 2000, Act 54, Eff. Apr. 1, 2000;Am. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 6
REVOCABLE TRUSTS
700.7601 Capacity of settlor of revocable trust.
Sec. 7601. The capacity required to create, amend, revoke, or add property to a revocable trust, or to direct
the actions of the trustee of a revocable trust, is the same as that required to make a will.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
700.7607 Rules regarding payment of expenses and obligations; priority; decedent as settlor
of more than 1 trust.
Sec. 7607. (1) The following rules apply to section 7606(2):
(a) Upon the failure or insufficiency of money or property out of which payment should be made, to the
extent of the insufficiency, a distribution of property from the trust that is to be satisfied out of specified or
identified property shall be classed as a distribution to be satisfied out of the general trust property not
otherwise disposed of in the terms of the trust.
(b) A distribution of property from the trust given for valuable consideration abates with other distributions
of the same class only to the extent of the excess over the amount of the value of the consideration until all
others of the same class are exhausted.
(c) Except as otherwise provided in this section, distributions of property from the trust abate equally and
ratably and without preference or priority as between real and personal property.
(d) If a specified or identified item of property that has been designated for distribution in the terms of the
trust or that is charged with a distribution is sold or taken by the trustee, other beneficiaries shall contribute
according to their respective interests to the trust beneficiary whose property is sold or taken, and, before
distribution, the trustee shall determine the amounts of the respective contributions, which shall be paid or
withheld before distribution is made.
(2) Costs and expenses of trust administration, including trustee compensation and attorney fees, shall be
paid by the trustee before and in preference to the administration costs and expenses of the settlor's estate, an
enforceable and timely filed claim of a creditor of the settlor, and homestead, family, and exempt property
allowances. If, after paying costs and expenses of trust administration, the trust property is insufficient to pay
in full all charges for which the trust is liable under section 7605(1), the trustee shall make payment in the
following order of priority:
(a) Costs and expenses of administration of the decedent's estate.
(b) Reasonable funeral and burial expenses.
(c) Homestead allowance.
(d) Family allowance.
(e) Exempt property.
(f) Debts and taxes with priority under federal law.
(g) Reasonable and necessary medical and hospital expenses of the decedent's last illness, including
compensation of a person attending the decedent.
(h) Debts and taxes with priority under other laws of this state.
(i) All other claims.
(3) A preference shall not be given in the payment of a charge over another charge of the same class under
subsection (2), and a charge due and payable is not entitled to a preference over a charge not due.
(4) If the decedent was the settlor of more than 1 trust described in section 7605(1), the charges described
in that section are payable pro rata from those trusts based on the gross values of the respective trusts on the
date of the decedent's death. Each trustee is entitled to right of contribution as necessary to effect the pro rata
liability. The allocation and contribution, however, are subject to provisions in the trusts regarding the
allocation and burden of the charges. If there is conflict between the terms of the trusts regarding the
allocation and burden of the charges, the decedent's will controls.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 7
OFFICE OF TRUSTEE
700.7701 Acceptance or rejection of trusteeship.
Sec. 7701. (1) Except as otherwise provided in subsection (3), a person designated as trustee accepts the
trusteeship by doing either of the following:
(a) Substantially complying with a method of acceptance provided in the terms of the trust.
(b) If the terms of the trust do not provide a method or the method provided in the terms is not expressly
made exclusive, accepting delivery of the trust property, exercising powers or performing duties as trustee, or
otherwise indicating acceptance of the trusteeship.
(2) 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.
(3) A person designated as trustee, without accepting the trusteeship, may do all of the following:
(a) Act to preserve the trust property if, within a reasonable time after acting, the person sends a rejection
of the trusteeship to the settlor or, if the settlor is dead or lacks capacity, to a qualified trust beneficiary.
(b) Exercise all powers set forth under section 7818(1)(a).
(c) Inspect or investigate trust property to determine potential liability under other law or for any other
purpose.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
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Popular name: EPIC
700.7703b Separate trustees provision; trust instrument; duties and powers; liability;
definitions.
Sec. 7703b. (1) A trust instrument may include a separate trustees provision.
(2) While a separate trustees provision applies, the whole trusteeship of the aggregate trust is divided,
under the terms of the separate trustees provision, into discrete sets of separately accepted fiduciary
responsibilities, with each discrete set separately allocated to 1 or another of the aggregate trust's separate
trustees. All of the following apply while a separate trustees provision applies:
(a) Except as provided in subdivision (c), the aggregate trust's separate trustees are not treated as cotrustees
in their relations to one another. With regard to the common title to the trust property described in subdivision
(c)(i), all of the following apply:
(i) A separate investment trustee accepts the common title only for purposes of performing the trustee
investment function described by the governing separate trustees provision for the benefit of the trust
beneficiaries.
(ii) A separate distributions trustee accepts the common title only for purposes of administering a
discretionary trust provision specified in the governing separate trustees provision for the benefit of the trust
beneficiaries affected by the specified discretionary trust provisions.
(iii) A separate resultant trustee accepts the common title only for purposes of performing all trustee
functions not allocated by the governing separate trustees provision to either of the following:
(A) A separate investment trustee, if any.
(B) A separate distributions trustee.
(b) A separate trustee shall act on its own authority with respect to each of its separate trustee functions. A
separate trustee does not need approval from any other separate trustee to conduct its separate trustee
functions.
(c) The aggregate trust's separate trustees are treated as cotrustees in their relations to one another only for
the following purposes:
(i) Taking, holding, transferring, and defending title to trust property.
(ii) Determining venue and interested persons in proceedings concerning the aggregate trust.
(iii) Liability, if any, for income, property, or other taxes attributable to trust property.
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(iv) The privileges and immunities of cotrustees under general principles of law and equity to comment to
a settlor or beneficiary of a trust or others on one another's performance of fiduciary duties.
(d) The aggregate trust's separate trustees are not cotrustees for either of the following purposes:
(i) Joinder of necessary parties in a proceeding for breach of trust.
(ii) The requirement in section 7402 that the same person is not the sole trustee and sole beneficiary of a
trust. If the aggregate trust has only 1 beneficiary, the beneficiary may not be a separate trustee of the trust
unless both of the following apply:
(A) The separate trustee comprises a cotrusteeship of which the beneficiary is a cotrustee.
(B) The trust instrument prohibits the beneficiary from serving alone.
(e) A separate trustee shall not accept the separate trust associated with, or, except as otherwise provided in
this subdivision, participate in or provide advice regarding the performance of, a separate trustee function of
any other separate trustee of the aggregate trust. Ministerial acts performed by 1 separate trustee in connection
with a separate trustee function of another separate trustee of the aggregate trust are not considered an
acceptance of the separate trust associated with the separate trustee function of the other separate trustee. As
used in this subdivision, "ministerial acts" includes any of the following:
(i) Confirming that an investment or distribution directive of another separate trustee has been carried out.
(ii) Recording and reporting the actions of another separate trustee or conferring with another separate
trustee for purposes of administrative coordination or efficiency.
(f) A separate trustee does not have a duty to petition the court or to take other affirmative action to ensure
that any vacancy in any separate trusteeship is filled. If a separate trustee petitions the court or takes other
affirmative action to ensure that a vacancy in a separate trusteeship is filled, both of the following apply:
(i) The separate trustee is not considered to have accepted the separate trust associated with the vacant
separate trusteeship.
(ii) The separate trustee does not have a duty to petition the court or take other affirmative action to ensure
that any other vacancy in a separate trusteeship is filled.
(3) A separate trustees provision must determine all of the following:
(a) If there is a separate investment trustee, that the separate investment trustee shall perform the trustee
investment function.
(b) That 1 or more separate distributions trustees, if any, shall exercise discretion under 1 or more specified
discretionary trust provisions.
(c) Which of the aggregate trust's separate trustees shall perform, during any period in which the aggregate
trust is not a unitrust, the function of allocating between principal and income, for fiduciary accounting
purposes, receipts and disbursements or distributions affected by the separate trustees' separate trustee
functions.
(d) Which of the aggregate trust's separate trustees is responsible for preparation and filing of tax and
information returns for the aggregate trust and for responding on behalf of the aggregate trust to inquiries
from governmental agencies.
(e) Which of the aggregate trust's separate trustees is responsible for responding to a proceeding
challenging a purpose or the validity of the trust.
(f) Which of the aggregate trust's separate trustees is responsible for determining whether at any time cash
or other property will be loaned by the trust to any of the following:
(i) One or more trust beneficiaries.
(ii) One or more business enterprises in which a trust beneficiary has an ownership interest.
(iii) One or more business enterprises in which the aggregate trust itself has an ownership interest.
(g) For a separate investment trustee, whether the separate investment trustee or the separate resultant
trustee shall determine the aggregate trust's asset allocation for investment purposes.
(h) That the separate resultant trustee is responsible for the custody of the aggregate trust's property.
(4) With regard to a separate trustee function of a separate trustee, all of the following apply:
(a) The separate trustee has all of the duties and powers of a trustee described in this part and part 8 of this
article.
(b) The separate trustee is subject to control by both of the following in the same circumstances as would
be a trustee or cotrusteeship that is not a separate trustee:
(i) Each settlor of a revocable trust.
(ii) A holder of a power to direct a trustee, if any.
(c) The separate trustee is required to seek or consider the advice of a designated trust advisor, if any, in
the same circumstances as would a trustee or cotrusteeship that is not a separate trustee.
(5) If a separate trustee comprises a cotrusteeship, with regard to a separate trustee function of the separate
trustee, the cotrustees have all of the duties and powers of cotrustees described in this part.
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(6) A separate trustee has the duty to inform and report on each of its separate trustee functions to both of
the following:
(a) Trust beneficiaries as described in section 7814. However, a separate trustee is not required to provide a
beneficiary a report that the separate trustee knows will duplicate a report that another separate trustee of the
aggregate trust provided or will provide to the beneficiary.
(b) Each other separate trustee of the aggregate trust as is reasonably necessary for the other separate
trustee to perform a separate trustee function of the other separate trustee.
(7) A separate trustee does not have a duty to do any of the following:
(a) Monitor or review the actions of any other separate trustee of the aggregate trust.
(b) Notify or warn a settlor or beneficiary of the aggregate trust of a breach of trust or possible breach of
trust on the part of any other separate trustee.
(8) If a separate trustee notifies or warns a settlor or beneficiary as described in subsection (7)(b), both of
the following apply:
(a) The separate trustee is not considered to have accepted the separate trust associated with the separate
trustee function of the other separate trustee.
(b) The separate trustee does not have a duty to notify or warn a settlor or beneficiary of any other breach
or possible breach of trust on the part of any other separate trustee.
(9) Absent clear and convincing evidence of collusion in a breach of trust, all of the following apply:
(a) A separate trustee is not liable for the act or omission of any other separate trustee of the aggregate
trust.
(b) A separate trustee in breach of a trustee duty of a separate trustee function of the separate trustee is the
only separate trustee of the aggregate trust obliged to defend or otherwise respond to any proceeding brought
by a trust beneficiary regarding that breach.
(c) Except as provided in subdivision (d), a separate trustee is liable to trust beneficiaries for breach of a
trustee duty of a separate trustee function of the separate trustee as if the other separate trustees of the
aggregate trust were not in office and the separate trustee were the sole trustee of the aggregate trust.
(d) A separate trustee may be liable concerning a trustee function of another separate trustee of the
aggregate trust only for the separate trustee's own actions in the performance of ministerial acts pursuant to
the other separate trustee's instruction and only to the extent the separate trustee acts in bad faith.
(10) As used in this section:
(a) "Affirmative action" by a separate trustee does not include a failure to act.
(b) "Aggregate trust" means the inclusive set of separate relations of trust to be separately accepted by the
separate trustees under a given separate trustees provision.
(c) "Cotrusteeship" means a set of 1 or more cotrustees whose relations to one another in respect of trust
property is governed by section 7703.
(d) "Separate distributions trustee" means a person or a cotrusteeship that is designated by a separate
trustees provision to exercise discretion as a trustee or trustees under a discretionary trust provision.
(e) "Separate investment trustee" means a person or a cotrusteeship that is designated by a separate trustees
provision to perform the trustee investment function as a trustee or trustees.
(f) "Separate resultant trustee" means a person or a cotrusteeship that is designated as a trustee or trustees
to perform all trustee functions not allocated by the separate trustees provision to a separate investment trustee
or to any separate distributions trustee.
(g) "Separate trustee" means a separate resultant trustee, separate investment trustee, or separate
distributions trustee.
(h) "Separate trustees provision" means a trust provision that designates or provides a method of
designating both of the following:
(i) A separate resultant trustee.
(ii) A separate investment trustee or 1 or more separate distributions trustees.
(i) "Separate trusteeship" means the office of a separate trustee.
(j) "Trustee investment function" means a trustee function expressly allocated by the separate trustees
provision to a separate investment trustee. A trustee investment function may be broadly or narrowly defined
by the separate trustees provision and may include any of the following:
(i) Determining for trust investment purposes the retention, purchase, sale, assignment, exchange, tender,
or encumbrance of trust property and the investment and reinvestment of undistributed income and principal
of the aggregate trust.
(ii) Management, control, and exercise of voting powers related directly or indirectly to any trust asset.
(iii) For nonpublicly traded investments or property for which there is no readily available market value,
determining the methodology for valuing the property and the frequency of valuations.
Rendered Wednesday, January 12, 2022 Page 27 Michigan Compiled Laws Complete Through PA 168 of 2021
Courtesy of www.legislature.mi.gov
History: Add. 2018, Act 662, Eff. Mar. 29, 2019.
Popular name: EPIC
PART 8
DUTIES AND POWERS OF TRUSTEE
700.7801 Administration of trust; duties of trustee.
Sec. 7801. Upon acceptance of a trusteeship, the trustee shall administer the trust in good faith,
expeditiously, in accordance with its terms and purposes, for the benefit of the trust beneficiaries, and in
accordance with this article.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
Rendered Wednesday, January 12, 2022 Page 30 Michigan Compiled Laws Complete Through PA 168 of 2021
Courtesy of www.legislature.mi.gov
700.7809 Repealed. 2018, Act 664, Eff. Mar. 29, 2019.
Compiler's note: The repealed section pertained to the exercise of powers by a trust protector.
Popular name: EPIC
700.7813 Duty to locate trust property and compel delivery; retention of reserve for payment
of expenses; improper distribution or payment from trust; wrongful conversion.
Sec. 7813. (1) A trustee shall take reasonable steps to locate trust property and to compel a former trustee
or other person to deliver trust property to the trustee.
(2) A resigning trustee or a trustee being replaced by a successor may retain a reasonable reserve for the
payment of debts, taxes, and expenses, including attorney fees and other expenses incidental to the allowance
of the trustee's accounts.
(3) Unless the distribution or payment can no longer be questioned because of adjudication, estoppel, or
other limitation, a distributee or claimant that receives property that is improperly distributed or paid from a
trust shall return the property and any income and gain from the property since distribution, if the recipient
has the property. If the recipient does not have the property, the recipient shall pay the value of the property as
of the date of distribution or payment and any income and gain from the property since distribution.
(4) If a person embezzles or wrongfully converts trust property, or refuses, without colorable claim of
right, to transfer possession of trust property to the current trustee upon demand, the person is liable in an
action brought by the current trustee, or the beneficiary of the trust for the benefit of the trust, for double the
value of any property embezzled, converted, or wrongfully withheld from the current trustee.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
PART 9
LIABILITY OF TRUSTEES AND RIGHTS OF PERSONS DEALING WITH TRUSTEE
700.7901 Remedies for breach of trust.
Sec. 7901. (1) A violation by a trustee of a duty the trustee owes to a trust beneficiary is a breach of trust.
(2) To remedy a breach of trust that has occurred or may occur, the court may do any of the following:
(a) Compel the trustee to perform the trustee's duties.
(b) Enjoin the trustee from committing a breach of trust.
(c) Compel the trustee to redress a breach of trust by paying money, restoring property, or other means.
(d) Order a trustee to account.
(e) Appoint a special fiduciary to take possession of the trust property and administer the trust.
(f) Suspend the trustee.
(g) Remove the trustee as provided in section 7706.
(h) Reduce or deny compensation to the trustee.
(i) Subject to section 7912, 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.
(j) Order any other appropriate relief.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
700.7904 Attorney fees and costs; receipt of expenses and disbursements; reduction or
denial of claim with respect to breach of trust.
Sec. 7904. (1) In a proceeding involving the administration of a trust, the court, as justice and equity
require, may award costs and expenses, including reasonable attorney fees, to any party who enhances,
preserves, or protects trust property, to be paid from the trust that is the subject of the proceeding.
(2) Subject to subsection (3), if a trustee participates in a civil action or proceeding in good faith, whether
successful or not, the trustee is entitled to receive from trust property all expenses and disbursements
including reasonable attorney fees that the trustee incurs in connection with its participation.
(3) A court may reduce or deny a trustee's claim for compensation, expenses, or disbursements with
respect to a breach of trust.
History: Add. 2009, Act 46, Eff. Apr. 1, 2010.
Popular name: EPIC
Rendered Wednesday, January 12, 2022 Page 41 Michigan Compiled Laws Complete Through PA 168 of 2021
Courtesy of www.legislature.mi.gov