The default nobody expects
People accept the role of trust protector casually. A family friend, an accountant, a former lawyer is asked to hold a power to remove trustees or approve distributions, and accepts because it sounds administrative.
In Florida it is not administrative.
A trust director has the same fiduciary duty and liability in the exercise or nonexercise of the power:
1. If the power is held individually, as a sole trustee in a like position and under similar circumstances; or
2. If the power is held jointly with a trustee or another trust director, as a cotrustee in a like position and under similar circumstances.
Section 736.1408(1)(a), Florida Statutes.
Note exercise or nonexercise. Doing nothing is covered. A director who holds a power to remove a trustee and declines to use it while the trust is mismanaged is exercising judgement, and is judged on it.
Note also the pairing. Hold the power alone and you are measured against a sole trustee, the most exposed position in trust law. Hold it jointly and you are measured against a cotrustee, which brings in the rules about standing by while another fiduciary breaches. Our page on section 736.0703 covers that point, and it is the one cotrustees most often get wrong.
How far the document can reduce it
The terms of the trust may vary the trust director’s duty or liability to the same extent the terms of the trust may vary the duty or liability of a trustee in a like position and under similar circumstances.
Section 736.1408(1)(b), Florida Statutes.
That is a ceiling expressed by reference to another ceiling. Whatever a trust could do to a trustee’s duty, it can do to a director’s. Whatever it could not, it cannot.
Which sends you to section 736.0105(2), the list of things the terms of a trust cannot override at all. The article written by the Act’s drafting chair gives the worked example.
Thus, for example, since 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 cannot be eliminated by the trust instrument under F.S. §736.0105(2)(b) for a trustee, the same minimum duty applies to the duty of a trust protector.
Rubin and Rubin, The Florida Bar Journal, March/April 2022. The statute uses the term trust director throughout; the article uses trust protector here.
There is a floor and it cannot be drafted away. An instrument saying a protector owes no duties whatsoever does not achieve that, however emphatically it is worded.
Subsection (3) runs the other way. The terms may impose duties or liabilities in addition to those in the section. The statutory position is a default in both directions.
The health care exception, which is genuinely unusual
Unless the terms of a trust provide otherwise, if a trust director is licensed, certified, or otherwise authorized or permitted by law other than this part to provide health care in the ordinary course of the trust director’s business or practice of a profession, to the extent the trust director acts in that capacity the trust director has no duty or liability under this part.
Section 736.1408(2), Florida Statutes.
Not a reduced duty. No duty or liability under the Part at all, to the extent of acting in that capacity.
The situation it addresses is common in incapacity and special needs planning. A trust says the settlor is deemed incapacitated when their physician certifies it, or names a doctor to advise on care decisions. Without this subsection the physician would arguably be a trust director holding a power of direction, exposed to the fiduciary standard in subsection (1), which would make any sensible doctor decline the role.
Three limits are worth noticing. It applies only to the extent the director acts in the health care capacity, so a physician who also holds an investment power is a full fiduciary as to that power. It covers those licensed, certified or otherwise authorized by law, so it is tied to professional regulation rather than to medical activity generally. And it is a default, so the terms of the trust can provide otherwise.
What the director is measured on
The duty attaches to a power of direction and to any further power under section 736.1406(3)(a), meaning powers appropriate to exercising the granted power.
That matters because the further power category is not written out anywhere. The drafting committee took the view that it includes hiring and paying lawyers, including in defence of a breach of trust action, and deliberately left that unstated in the statute.
The draftspersons concluded that such a power to hire and direct payment of fees and costs for those engaged was implicit in the statutory language, as noted in the comments to the uniform act.
Rubin and Rubin, The Florida Bar Journal, March/April 2022, on the further power language in section 736.1406(3)(a).
We report that as what it is, the drafters’ stated understanding, published by The Florida Bar, and not something the statute says.
No court has construed this section
Our review found no citing decision, on a Florida court filter and nationwide, at every precedential status. The Part took effect on July 1, 2021.
The practical advice does not depend on case law. If you have been asked to serve as a trust protector or director in Florida, the default is that you are a fiduciary judged as a trustee, and the question to ask before accepting is what the instrument says about your duty, not what the role is called.