Title XXXIII, Administration of Trusts and Estates of Persons Under Disability

(1) Subject to the statutory provisions of KRS Chapter 396 regarding claims against decedents' estates, whether or not the terms of a trust contain a spendthrift provision, the following rules apply: (a) During the lifetime of the settlor, the property of a revocable trust is sub…

(1) As used in this section, "mandatory distribution" means a distribution of income or principal which the trustee is required to make to a beneficiary under the terms of the trust, including a distribution on termination of the trust. The term shall not include a distribution s…

Trust property is not subject to personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt.

The capacity required to create, amend, revoke, or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that required to make a will.

(1) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. This subsection shall not apply to a trust created under an instrument signed before July 15, 2014. (2) If a revocable trust is created or funded by more th…

(1) While a trust is revocable: (a) And, in the reasonable belief of the trustee, the settlor has capacity to revoke the trust, rights of the beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the settlor; and (b) The trustee may f…

Distribution of trust property. (1) A person may commence a judicial proceeding to contest the validity of a trust that was revocable at the settlor's death within the earlier of: (a) Two (2) years after the settlor's death; or (b) Ninety (90) days after the trustee sent the pers…

(1) Except as otherwise provided in subsection (3) of this section, a person designated as trustee accepts the trusteeship: (a) By substantially complying with a method of acceptance provided in the terms of the trust; or (b) If the terms of the trust do not provide a method or t…

(1) A trustee shall give bond to secure performance of the trustee's duties only if the court finds that a bond is needed to protect the interests of the beneficiaries or is required by the terms of the trust and the court has not dispensed with the requirement. (2) The court may…

(1) Cotrustees who are unable to reach a unanimous decision may act by majority decision. (2) If a vacancy occurs in a cotrusteeship, the remaining cotrustees may act for the trust. (3) Subject to KRS 386B.12-110, a cotrustee shall participate in the performance of a trustee's fu…

(1) A vacancy in a trusteeship occurs if: (a) A person designated as trustee rejects the trusteeship; (b) A person designated as trustee cannot be identified or does not exist; (c) A trustee resigns; (d) A trustee is disqualified or removed; (e) A trustee dies; or (f) A guardian,…

(1) A trustee may resign: (a) Upon at least thirty (30) days' notice to the qualified beneficiaries and all cotrustees; or (b) With the approval of the court. (2) In approving a resignation, the court may issue orders and impose conditions reasonably necessary for the protection …

(1) The settlor, a cotrustee, or a beneficiary may request the court to remove a trustee, or a trustee may be removed by the court on its own initiative. (2) The court may remove a trustee if: (a) The trustee has committed a breach of trust; (b) Lack of cooperation among cotruste…

(1) Unless a cotrustee remains in office or the court otherwise orders, and until the trust property is delivered to a successor trustee or other person entitled to it, a trustee who has resigned or been removed has the duties of a trustee and the powers necessary to protect the …

(1) If the terms of a trust do not specify the trustee's compensation, a trustee is entitled to compensation that is reasonable under the circumstances. (2) If the terms of a trust specify the trustee's compensation, the trustee is entitled to be compensated as specified, but the…

(1) A trustee is entitled to be reimbursed out of the trust property, with interest as appropriate, for: (a) Expenses that were properly incurred in the administration of the trust; and (b) To the extent necessary to prevent unjust enrichment of the trust, expenses that were not …

The District Court shall have exclusive jurisdiction over matters under this subchapter relating to the office of the trustee.

Upon acceptance of a trusteeship, the trustee shall administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with this chapter.

(1) A trustee shall administer the trust solely in the interests of the beneficiaries. (2) Subject to the rights of persons dealing with or assisting the trustee as provided in KRS 386B.10-110, a sale, encumbrance, or other transaction involving the investment or management of tr…

If a trust has two (2) or more beneficiaries, the trustee shall act impartially in investing, managing, and distributing the trust property, giving due regard to the beneficiaries' respective interests.

A trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distributional requirements, and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.

In administering a trust, the trustee may incur only costs that are reasonable in relation to the trust property, the purposes of the trust, and the skills of the trustee.

A trustee who has special skills or expertise, or is named trustee in reliance upon the trustee's representation that the trustee has special skills or expertise, shall use those special skills or expertise.

(1) A trustee may delegate duties and powers that a prudent trustee of comparable skills could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill, and caution in: (a) Selecting an agent; (b) Establishing the scope and terms of the delegat…

A trustee shall take reasonable steps to take control of and protect the trust property.

(1) A trustee shall keep adequate records of the administration of the trust. (2) A trustee shall keep trust property separate from the trustee's own property. (3) Except as otherwise provided in subsection (4) of this section, a trustee shall cause the trust property to be desig…

A trustee shall take reasonable steps to enforce claims of the trust and to defend claims against the trust.

A trustee shall take reasonable steps to compel a former trustee or other person to deliver trust property to the trustee, and to redress a breach of trust known to the trustee to have been committed by a former trustee.

(1) Except as otherwise provided in the terms of the trust: (a) A trustee shall 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. Unless unreasonable und…

(1) The judicial standard of review for a discretionary power is that the trustee shall exercise the power reasonably, in good faith, and in accordance with the terms and purposes of the trust and the interests of the beneficiaries, except that a reasonableness standard shall not…

(1) A trustee, without authorization by the court, may exercise: (a) Powers conferred by the terms of the trust; and (b) Except as limited by the terms of the trust: 1. All powers over the trust property which an unmarried competent owner has over individually owned property; 2. …

Without limiting the authority conferred by KRS 386B.8-150, a trustee may: (1) Collect trust property and accept or reject additions to the trust property from a settlor or any other person; (2) Acquire or sell property, for cash or on credit, at public or private sale; (3) Excha…

(1) Upon termination or partial termination of a trust, the trustee may send to the beneficiaries a proposal for distribution. The right of any beneficiary to object to the proposed distribution terminates if the beneficiary does not notify the trustee of an objection within thir…

Objection. (1) (a) When a trust terminates pursuant to the terms of the trust, the trustee may follow the requirements for distribution upon termination as provided in KRS 386B.8-170 or, if proceeding under this section, within a reasonable amount of time after such termination, …

All trustees acting under this chapter with respect to investments shall have the authority and duties as set forth in KRS 286.3-277 to act as a prudent investor.