30-3805. (UTC 105) Default and mandatory rules.

(UTC 105) (a) Except as otherwise provided in the terms of the trust, the Nebraska Uniform Trust Code governs the duties and powers of a trustee, relations among trustees, and the rights and interests of a beneficiary.

(b) The terms of a trust prevail over any provision of the code except:

(1) the requirements for creating a trust;

(2) subject to sections 30-4309, 30-4311, and 30-4312, the duty of a trustee to act in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries;

(3) the requirement that a trust and its terms be for the benefit of its beneficiaries, and that the trust have a purpose that is lawful, not contrary to public policy, and possible to achieve;

(4) the power of the court to modify or terminate a trust under sections 30-3836 to 30-3842;

(5) the effect of a spendthrift provision and the rights of certain creditors and assignees to reach a trust as provided in sections 30-3846 to 30-3852;

(6) the power of the court under section 30-3858 to require, dispense with, or modify or terminate a bond;

(7) the power of the court under subsection (b) of section 30-3864 to adjust a trustee's compensation specified in the terms of the trust;

(8) the duty under subsection (a) of section 30-3878 to keep the qualified beneficiaries of the trust reasonably informed about the administration of the trust and of the material facts necessary for them to protect their interests, and to respond to the request of a qualified beneficiary of an irrevocable trust for trustee's reports and other information reasonably related to the administration of a trust;

(9) the effect of an exculpatory term under section 30-3897;

(10) the rights under sections 30-3899 to 30-38,107 of a person other than a trustee or beneficiary;

(11) periods of limitation for commencing a judicial proceeding;

(12) the power of the court to take such action and exercise such jurisdiction as may be necessary in the interests of justice;

(13) the subject matter jurisdiction of the court and venue for commencing a proceeding as provided in sections 30-3814 and 30-3815;

(14) the power of a court under subdivision (a)(1) of section 30-3807; and

(15) the power of a court to review the action or the proposed action of the trustee for an abuse of discretion.

Source

Annotations

A reasonable person acting in good faith and in the interests of the beneficiaries would not wait until an annual report was due before informing the beneficiaries that the trust assets were in danger of being lost, but would instead inform the beneficiaries of the material facts immediately in order to allow them to protect their interests. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).

An attorney's duty to report any danger to the trust property becomes immediate when he or she knows or should know that such danger exists rather than when an annual report is due. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).

In drafting a trust, an attorney cannot abrogate his or her duty to administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with the Nebraska Uniform Trust Code. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).

In drafting a trust, an attorney cannot abrogate his or her duty under this section to keep beneficiaries of the trust reasonably informed of the material facts necessary for them to protect their interests. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).

The beneficiaries alleged sufficient facts for a court to find that the trustee acted in bad faith or reckless indifference to the purposes of the trust or the interests of the beneficiaries by providing a false address to the insurers of life insurance policies, which were the sole trust property. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).

The Nebraska Uniform Trust Code provides deference to the terms of the trust, but that deference does not extend to those duties described in this section or otherwise required by statute. Rafert v. Meyer, 290 Neb. 219, 859 N.W.2d 332 (2015).