What Section 736.0804 Says
Here is the whole section, quoted from the Legislature's own text.
A trustee shall administer the trust as a prudent person 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.
Two sentences. The first sets the measure, a prudent person, and tells the trustee what to weigh. The second names what has to be brought to the task, namely care, skill and caution.
The section has never been amended since it took effect on July 1, 2007, and a drafter of the code described the duties it codified as consistent with existing Florida decisional and statutory law. So it wrote down an obligation Florida trustees already had.
It Is Not Only About Investments
The word is administer, and it covers the whole job. Making distributions, keeping records, communicating with beneficiaries, dealing with property, following the settlor's directions, deciding when to take advice.
That matters because most people arrive at prudence expecting a rule about portfolios. The only Florida decision we located applying this section involved no investment question whatsoever.
The Case: A Bank, a Promise, and Yale
In 2014 Florida's Third District decided a case about a woman who had promised to pay her first cousin's grandson's university expenses. He relied on it and went to Yale instead of using a Florida prepaid tuition account. After her death, her son and a bank served as co-trustees of her trust, and the payments stopped.
The court found several duties breached at once.
The failure of Wells Fargo to carry out the terms of the Trust, under the factual circumstances of this case, violated sections 736.0801, Florida Statutes (2010) (duty to administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries), 736.0803 (duty to act impartially as among beneficiaries), and 736.0804 (duty to prudently administer the trust by considering the purposes, terms, distribution requirements, and other circumstances of the trust). These breaches of duty establish the liability of the co-trustees for a breach of trust. § 736.1001(1), Fla. Stat.
Kritchman v. Wolk, 152 So. 3d 628 (Fla. 3d DCA 2014).
So a Florida appellate court has found this duty violated, and the conduct was a refusal to carry out the trust's terms rather than a bad investment.
Be careful about how far that goes. The court found three duties breached by one course of conduct and gave each a one line description. It did not separately analyse what prudent administration requires, or explain how far a trustee can stray before crossing the line. We are not going to build a test out of a parenthetical.
The same opinion is unusually direct about what institutional trustees are for.
Institutional trustees charge and are paid fees for following such directions, and they are exposed to liability when they do not.
Kritchman v. Wolk, 152 So. 3d 628 (Fla. 3d DCA 2014), n.6.
Prudence Is Measured Against This Trust
The statute does not ask what a prudent person would do in the abstract. It directs the trustee to consider the purposes, terms, distribution requirements and other circumstances of the trust.
That has a practical consequence for both sides of a dispute. A trustee defending a decision should be able to explain it by reference to what the document was trying to achieve. A beneficiary challenging one starts with the same document, because conduct that looks careless in isolation may be exactly what the trust required, and conduct that looks ordinary may be imprudent for a trust with an unusual purpose.
It also explains why this duty sits so close to the others. In the 2014 case the same conduct breached the duty to administer in good faith under section 736.0801, the duty of impartiality under Fla. Stat. 736.0803, and this one. Duties that all point at the trust's terms tend to be breached together.
Where Investment Law Actually Lives
If your question is how the portfolio was invested, this section is the general duty rather than the detailed rules.
Florida's prudent investor provisions are in chapter 518, and they are where the specific requirements sit, including how investment decisions are evaluated as part of an overall strategy rather than one holding at a time. A claim about diversification, asset allocation or a concentrated position is built there, with this section as the general standard behind it.
Two related sections are worth knowing. Where the complaint is that a trustee with discretion refused to act, Fla. Stat. 736.0814 is the provision that imposes a good faith floor on that discretion. And where a breach is established, the menu of what a court can order is in Fla. Stat. 736.1001.
Frequently Asked Questions
What Is the Duty of Prudent Administration in Florida?
Section 736.0804 states it in two sentences. A trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust, and in satisfying that standard the trustee shall exercise reasonable care, skill, and caution. The measure is what a prudent person would do, and it is applied to this trust rather than to trusts in general, because the section directs the trustee to consider the purposes and terms of the document.
Does Prudent Administration Only Mean Prudent Investing?
No, and reading it that way misses most of the section. The word is administer, which covers the whole job, including distributions, record keeping, dealing with beneficiaries, handling property, and following the settlor's directions. The single Florida decision we located applying this section involved no investment question at all. It concerned a corporate co-trustee that failed to carry out the terms of the trust by not paying a beneficiary's university expenses, and the court held the duty of prudent administration was among the duties breached.
Has a Florida Court Found a Trustee Breached This Duty?
Yes, once that we located. In 2014 Florida's Third District held that a corporate co-trustee's failure to carry out the terms of the trust violated the duty to prudently administer the trust by considering the purposes, terms, distribution requirements, and other circumstances of the trust, alongside the duty to administer in good faith and the duty of impartiality. The court found all three breached by a single course of conduct, and treated those breaches as establishing liability for a breach of trust. What it did not do was separately analyse what prudent administration requires, so there is no Florida appellate statement of where the line sits.
What Does Reasonable Care, Skill and Caution Mean?
The statute uses those three words and does not define them, and we located no Florida decision construing them under this section. The natural reading is that they are cumulative rather than alternatives, namely care in attending to the job, skill appropriate to the role undertaken, and caution in the face of risk. A professional or corporate trustee holding itself out as expert is generally understood to be held to what it professes. Because there is no Florida case law under this section on the point, an argument about it is built from the statutory words and the facts.
How Does This Section Relate to the Prudent Investor Rule?
They are different provisions in different chapters. Section 736.0804 sets the general standard for administering the trust. Florida's prudent investor provisions sit in chapter 518 and govern investment and management of trust assets specifically, including diversification and the evaluation of investment decisions as part of an overall strategy. If your question is about how the portfolio was invested, chapter 518 is where the detailed rules are, and this section is the general duty sitting behind them.
Has Section 736.0804 Been Amended?
No. It reads today exactly as enacted in chapter 2006-217 and took effect with the rest of the Florida Trust Code on July 1, 2007. A drafter of the code described the codified duties, including prudent administration, as consistent with existing Florida decisional and statutory law, so the section wrote down a duty Florida trustees already owed rather than creating a new one.
Common Situations
The directive that stopped being followed. A parent left written instructions about paying a grandchild's school fees and after the parent's death the corporate trustee reads the trust more narrowly and stops. That is close to the facts of the 2014 case, where the court treated the failure to carry out the trust's terms as breaching this duty among others.
The concentrated stock position. A trust holds a single company's shares worth most of the fund and the trustee never diversifies. That is a real question, and it belongs primarily under Florida's prudent investor provisions in chapter 518, with this section as the general standard behind them.
The trustee who never took advice. A family member serving as trustee administers a complex trust without ever consulting a professional. The standard is care, skill and caution measured against what this trust required, so the question is not whether they meant well but whether the job called for expertise they did not have and did not obtain.
Sources of Law
- Fla. Stat. §736.0804 (prudent administration). Official text, Online Sunshine, quoted in full above. History: s. 8, ch. 2006-217. Never amended since the Florida Trust Code took effect on July 1, 2007. (retrieved 2026-08-13)
- Related sections from the same official source: §736.0801 (duty to administer in good faith); §736.0803 (impartiality); §736.0814 (discretionary powers). Florida's prudent investor provisions are in chapter 518. (retrieved 2026-08-13)
- Kritchman v. Wolk, 152 So. 3d 628 (Fla. 3d DCA Oct. 1, 2014), No. 3D12-2977 and No. 3D12-2457, Salter, J., with Lagoa and Emas, JJ. Quoted above for the finding that this duty was violated, and from footnote 6. Reading note: the court found three duties breached by a single course of conduct and described each in a short parenthetical. It did not separately analyse what prudent administration requires, and this page does not suggest it did. The same decision is discussed on our §736.0803 page. Source: CourtListener. (retrieved 2026-08-13)
- David F. Powell, The New Florida Trust Code, Part 2, 80 Fla. B.J. 9 (October 2006), at 22, for the statement that the codified trustee duties are consistent with existing Florida decisional and statutory law. The author was a drafter of the code. (retrieved 2026-08-13)
- Gap note, stated for the record: a search of Florida state and federal decisions for this section number, restricted to Florida courts, returned one case on August 13, 2026. We located no Florida decision construing what reasonable care, skill and caution require under this section, or applying it to an investment decision. A section-number search does not find decisions that discuss a provision without naming it, and no citator pass was run.
- Quotation note: the passages above reproduce a Florida court's own published words, the Legislature's own statutory text, and a signed bar journal article by a named author. Nothing is drawn from a headnote, case summary, or other editorial layer of a commercial research service.
- Nothing on this page predicts a result. Whether administration was prudent depends on the trust's purposes and terms and on the facts.
Updated on August 13, 2026. Reviewed by Kevin D. Klagge, Esq., Fla. Bar No. 99502. Attorney Kevin Klagge represents families, businesses, and international clients in estate and tax planning, business structuring, and international law, with a focus on Florida legal tools. He litigates estate and business issues in court. General information about Florida law and published court decisions, not legal advice, and no attorney-client relationship is created. Whether a trustee administered prudently depends on the trust and the facts, which we review at a free consult. Please do not send confidential details until we have connected.
