Uniform Fiduciary Act

Section 16320 names this section as the Uniform Fiduciary Income and Principal Act.

Section 16321 defines the following terms: “accounting period,” “asset-backed security,” “beneficiary,” “court,” “current income beneficiary,” “distribution,” “estate,” “fiduciary,” “income,” “income interest,” “independent person,” “mandatory income interest,” “net income,” “person,” “personal representative,” “principal,” “record,” “settlor,” “special tax benefit,” “successive interest,” “successor beneficiary,” “terms of a trust,” “trust,” “trustee,” and “will.”

Section 16322 applies this chapter to two types of estates.

Section 16323 explains that this chapter applies when this state is the principal place of administration of a trust or estate or the situs of property that is not held in a trust or estate and is subject to a life estate or other term interest. 

Article 2 deals with fiduciary duties and judicial review. Section 16325 provides that, in making an allocation or determination or exercising discretion under this chapter, all of the specified requirements apply. A fiduciary’s allocation, determination, or exercise of discretion under this chapter is presumed to be fair and reasonable to all beneficiaries. A fiduciary may exercise a discretionary power of administration given to the fiduciary by the terms of the trust, and an exercise of the power that produces a result different from a result required or permitted by this chapter does not create an inference that the fiduciary abused the fiduciary’s discretion.

Section 16326 defines the term “fiduciary decision.” The court may not order a fiduciary to change a fiduciary decision unless the court determines that the fiduciary decision was an abuse of the fiduciary’s discretion.

If the court determines that a fiduciary decision was an abuse of the fiduciary’s discretion, the court may order a remedy authorized by law. To place the beneficiaries in the positions the beneficiaries would have occupied if there had not been an abuse of the fiduciary’s discretion, the court may order any of six specified actions.

Section 16327 explains that a fiduciary, in a record, without court approval, may adjust between income and principal if the fiduciary determines the exercise of the power to adjust will assist the fiduciary in administering the trust or estate impartially. This section does not create a duty to exercise or consider the power to adjust or to inform a beneficiary about the applicability of this section.