A list built by going through the Code
Everything else in Part XIV is about what a trust director owes and what a trustee must do about it. This section answers a more basic question. When the Trust Code says trustee, does it mean a director too?
The answer is a list of thirty-one paragraphs, and the way it was assembled is what makes it useful.
The Florida Trust Code contains numerous provisions that apply to trustees. Without further statutory modifications, these provisions would not apply to a trust director. The draftspersons determined that many of the provisions should apply to a trust director, while others should not. Thus, a blanket inclusion or exclusion of Florida Trust Code trustee provisions to trust directors was deemed inappropriate. Instead, the draftspersons reviewed all applicable Florida Trust Code provisions and determined which should be extended to trust directors.
Rubin and Rubin, The Florida Bar Journal, March/April 2022.
One sentence turns the list into an interpretive rule.
Items in the Florida Trust Code that apply to trustees and are not expressly made applicable to a trust director by this provision or elsewhere in the act are intended not to apply to a trust director.
Rubin and Rubin, The Florida Bar Journal, March/April 2022.
Silence means no. That is not obvious from the statute, which simply lists things without saying what its omissions mean, and it is the single most useful thing to know about this section.
What is on it
The list is long and we are not going to reproduce it. The groupings are what matter.
- Court and procedure. The role of the court in trust proceedings, and proceedings to review employment of agents and compensation.
- Holding the office. Acceptance, bond, vacancies, resignation and removal.
- Being paid. Reasonable compensation under section 736.0708, reimbursement of expenses and liens under section 736.0709, and the fee payment procedure. That answers a question the drafters said prompted the Act, namely whether a trust director can be compensated.
- Investments. The duty to invest under chapter 518, and the life insurance carve out in section 736.0902.
- Remedies and defences. Breach of trust remedies, damages, the rule that a loss without a breach is not a claim, court awarded fees, reliance on the trust terms, the limits on exculpation, and releases.
- Discretion and creditors. The discretionary trust provisions and the limits on a trustee’s discretionary powers.
Two entries carry conditions worth isolating.
Modification is permissive only. Paragraph (1)(f) lets a director apply for judicial modification under section 736.04113 and its neighbours, and for termination of an uneconomic trust, only if the trust director is so authorized by the terms of the trust. The default is that a director cannot go to court to change the trust.
The carve out that tells you the most
Paragraph (1)(n) applies the trustee removal section, and then takes something back.
Court removal of a trustee, including who may request a removal, under s. 736.0706, but not to give the trust director the power to request removal of a trustee.
Section 736.1416(1)(n), Florida Statutes.
So a director is treated as a trustee for the removal provisions generally, which matters because a director can itself be removed. But a trust director may not petition to remove the trustee.
That is consistent with the rest of the Part. A power to remove a trustee is separately excluded from the Act altogether by section 736.1405(2)(b), so a protector holding a removal power holds it free of fiduciary duty under Part XIV. The Legislature evidently did not want the Act itself handing directors a removal route.
A settlor who wants a protector to be able to remove the trustee must therefore grant that power in the instrument, and should understand it will sit outside the Act.
The 60 day acceptance demand, and its missing sentence
Subsection (2) solves a genuine practical problem. A trustee accepts by taking property or exercising powers, so acceptance is visible. A director may hold a power that is not exercised for years, so acceptance may be invisible.
The remedy is a written demand. A trustee, settlor or qualified beneficiary may demand that a designated director accept, confirm prior acceptance, or decline in writing, and the response is due within 60 days after receipt, delivered to all trustees, all qualified beneficiaries and the settlor if living.
The statute states no consequence for ignoring it. That was a decision, not an oversight.
The draftspersons believed it would be problematic to automatically disqualify the trust director for failing to respond within that 60-day period, but intended that the mandatory obligation to respond can be enforced by an action of an interested person to obtain a determination by a court of competent jurisdiction as to acceptance or nonacceptance.
Rubin and Rubin, The Florida Bar Journal, March/April 2022.
So the answer to what if they do not reply is to go to court for a determination. Nothing in the text tells you that, and without the drafters’ account a reader would reasonably conclude the demand is unenforceable.
No court has construed this section
Our review found no citing decision, with a Florida court filter and nationwide, at every precedential status. The first nationwide query returned a rate limit error rather than a result, and we re-ran it before recording anything, because an error is not a zero.
The open question is what to do with the silences. The drafters say omission means exclusion. Whether a court will treat a practitioner article, however authoritative, as settling the point is untested, and the argument that a general provision applies of its own force to anyone acting in a fiduciary capacity has not been made in a reported case.