Chapter 709 — Chapter 709

ORS 709.005 Certificate of authority to transact trust business; application; contents; fee; exceptions. (1) Except as provided in ORS 709.030 (4) or in subsection (4) of this section, no company shall transact any trust business in this state until the company has obtained a certificate of authority from the Director of the Department of Consumer and Business Services under this section, authorizing the company to transact trust business in this state

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ORS 709.010 [Repealed by 1973 c.797 §428]

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ORS 709.015 Organization as limited liability company. (1) As an alternative to being organized as a corporation pursuant to the provisions of ORS chapter 707 and this chapter, an Oregon trust company may be organized as a limited liability company

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ORS 709.020 [Amended by 1973 c.428 §10; repealed by 1973 c.797 §428]

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ORS 709.030 Approval to transact trust business; exceptions; deposit of cash, securities, letter of credit or surety bond with director; amount. (1) Except as provided in subsection (4) of this section, no person other than a trust company shall transact a trust business in this state. Except as provided in subsection (4) of this section, before a person transacts any trust business in this state, the person shall obtain the approval of the Director of the Department of Consumer and Business Services if required under ORS 709.005 and shall deposit with the director, as security and as a pledge for the faithful conduct of its trust business

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ORS 709.040 Securities eligible for deposit. The securities mentioned in ORS 709.030 may only be of the following classes

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ORS 709.050 Trust companies depositing securities guaranteed by mortgage insurance and mortgage participation certificates. A trust company authorized to do a trust business in this state which is required to make any deposit of securities with any public official in order to do business in this state may deposit

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ORS 709.060 Primary liability of deposit. The deposit mentioned in ORS 709.030 is primarily liable for the malfeasance of a trust company as a fiduciary and is not liable for any debt or other obligation of the company until such malfeasance liability has been discharged. [Amended by 1973 c.797 §186; 1997 c.631 §206]

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ORS 709.070 Right of action against deposit. A person who suffers loss or damage because of the breach of any trust committed to a trust company may recover the amount of the loss or damage out of the moneys or securities deposited under ORS 709.030 with the director by the trust company. [Amended by 1973 c.797 §187; 1997 c.631 §207]

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ORS 709.080 Charges for handling securities; collection procedure. (1) The Director of the Department of Consumer and Business Services may charge a reasonable amount for any expenses incurred and services rendered in connection with deposits of securities

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ORS 709.090 [Repealed by 1973 c.797 §428]

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ORS 709.100 [Repealed by 1973 c.797 §428]

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ORS 709.110 Deposit of documents with notes or bonds. All mortgages or deeds of trust and all insurance policies, abstracts of title, certificates of title or title insurance policies and appraisements required by the Director of the Department of Consumer and Business Services under ORS 709.040 (3) shall be deposited with the notes or bonds. When less than the whole of a bond issue is deposited, the director shall not require the deposit of the abstract of title, certificates of title or title insurance policies and appraisements, but may require a certificate from the trustee of the mortgage or bond issue that the documents have been deposited with the trustee. [Amended by 1973 c.797 §189]

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ORS 709.120 Substitution of deposit securities; income of securities deposited. (1) The Director of the Department of Consumer and Business Services may require the immediate substitution of other securities when the director has reason to believe that the market value of securities which have been deposited under ORS 709.030 have depreciated below the amount required under ORS 709.030. Substitution of securities with the director at the request of the depositing trust company may be permitted if approved by the director

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ORS 709.130 Indemnity bond when cash and securities of fiduciary account exceed stockholders’ equity or members’ equity in trust company. If the cash and securities that belong to any single fiduciary account exceed the amount of a trust company’s stockholders’ equity or members’ equity, the court that appoints the trust company to the position of trust may require an indemnity bond from the trust company for the amount of cash and securities that exceeds the stockholders’ equity or members’ equity. [Amended by 1973 c.797 §191; 1999 c.59 §219; 2015 c.244 §75]

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ORS 709.140 Return of deposit; liability of state. The State of Oregon is liable for the return of any funds or securities deposited in accordance with ORS 709.030. [Amended by 1973 c.797 §192]

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ORS 709.145 Investment of capital. The capital of a trust company may be invested in the securities specified in ORS 709.040. [1973 c.797 §193]

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ORS 709.150 General powers of trust companies. A trust company may

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ORS 709.160 Solicitation and performance of legal business. (1) A trust company shall not advertise to furnish or furnish to the public legal advice or hold itself out as practicing law

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ORS 709.170 Establishment of and investment in common trust funds; rules; accounting. (1) “Common trust fund” as used in this section, means any fund maintained by a trust company exclusively for the collective investment and reinvestment of moneys contributed thereto by the trust company or an affiliated trust company as a fiduciary. For the purposes of this section, two or more trust companies are affiliated if they are members of the same affiliated group, within the meaning of section 1504 of the Internal Revenue Code

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ORS 709.175 Limitation on investment of trust funds; exceptions. (1) Except as provided in ORS 709.220, subsection (2) of this section, or as the instrument that creates the trust relationship or a court order authorizes, a trust company may not invest funds that the trust company holds as fiduciary in stock or obligations of, or property the trust company acquired from

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ORS 709.180 [Repealed by 1973 c.797 §428]

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ORS 709.190 Trust department kept separate; records of securities; retention of records. (1) Each banking institution and each non-Oregon institution authorized to transact a trust business in this state shall establish and maintain in its office a trust department, in which separate books and accounts shall be maintained. All property of the trust department shall be segregated from and unmingled with other property

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ORS 709.200 Acquisition or investment of trust property in own name or name of nominee. (1) In the acquisition or investment of trust property, a trust company may take in its own name, or in the name of its nominee, any assets in which it may be authorized to invest or hold trust property

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ORS 709.210 Disclosure of fiduciary character or terms of trust instrument. In acquiring, holding, satisfying and conveying trust property, a trust company is not required to disclose that it is acting in a fiduciary capacity, the terms or conditions of the instrument under which it acts, the nature or extent of its authority or the application of the proceeds of the transaction. A person dealing with a trust company may not inquire into the matters, except to the extent specified in ORS 709.270. [Amended by 1973 c.797 §199]

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ORS 709.220 Handling of funds awaiting investment or distribution; security for use of funds. (1) Funds placed or held in trust by a trust company awaiting investment or distribution shall not be held uninvested or undistributed for a longer period than is reasonable for the proper management of the account, shall be carried in a separate account and shall not be used by the trust company, bank or extranational institution in the conduct of its business or in the conduct of the business of any of its affiliates, except that such funds may be deposited in the commercial or savings or other department of the trust company, bank or extranational institution if the trust company, bank or extranational institution first obtains and sets aside in its trust department

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ORS 709.230 [Amended by 1961 c.344 §107; repealed by 1973 c.797 §428; amended by 1973 c.823 §143; amendment treated as reenactment, see 709.231]

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ORS 709.231 [1973 c.823 §143 amending 709.230 treated as reenactment of 709.230 repealed by 1973 c.797 §428; repealed by 1974 c.36 §28]

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ORS 709.240 Oath and bond exemption for trust company appointed as fiduciary. An official oath or indemnity bond or other security shall not be required when a trust company is appointed as fiduciary or during the administration of the trust except as required by ORS 709.030 and 709.130. [Amended by 1973 c.797 §201; 1973 c.823 §144; 1974 c.36 §26]

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ORS 709.250 [Repealed by 1973 c.797 §428; amended by 1973 c.823 §145; amendment treated as reenactment, see 709.251]

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ORS 709.251 [1973 c.823 §145 amending 709.250 treated as reenactment of 709.250 repealed by 1973 c.797 §428; repealed by 1974 c.36 §28]

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ORS 709.260 [Repealed by 1973 c.797 §428]

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ORS 709.270 Disclosure of communications and writings. A trust company shall, except as otherwise provided in this section, keep inviolate all communications and writings made to or by the trustees touching the existence, condition, management and administration of any private trust confided to it. A creditor or stockholder is not entitled to disclosure or knowledge of the communication or writing. However, the officers, manager, trust officer, secretary or attorney of the trust company may know of the communication or writing. In any suit or proceeding touching the existence, condition, management or administration of the trust, the court in which the matter is pending may require disclosure of the communication or writing. [Amended by 1973 c.797 §202; 1997 c.631 §217]

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ORS 709.280 Loans to directors, officers, employees or affiliates. (1) A trust company shall not make any loan to any director, officer or employee of the trust company or to any affiliate or any director, officer or employee of an affiliate from its trust funds, and shall not permit any director, officer, employee or affiliate to become indebted to it in any way out of its trust funds, unless specifically authorized to do so by the terms of the trust

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ORS 709.290 Closing of trust unduly delayed. If, as a result of an examination, the Director of the Department of Consumer and Business Services finds that the closing of any trust by a trust company has been unreasonably delayed, the director may initiate proceedings in a court of competent jurisdiction to require the trust company to perform its duties in closing the trust. [Amended by 1973 c.797 §204]

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ORS 709.300 Transaction of trust business by national bank. (1) A national bank authorized to conduct a trust business that has complied with the applicable provisions of this chapter may transact trust business in all respects, as provided by applicable laws of the United States and rules and regulations promulgated pursuant thereto. All acts provided in the Bank Act to be performed by the State Treasurer, the Director of the Department of Consumer and Business Services or other public officials for or in respect to trust companies, shall be performed for national banks equally with trust companies

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ORS 709.310 [Amended by 1963 c.55 §2; repealed by 1973 c.797 §428]

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ORS 709.320 [Repealed by 1973 c.797 §428]

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ORS 709.330 Sale or transfer of assets or liabilities; effect on fiduciary relations. (1) When a sale or transfer of assets or liabilities becomes effective, the purchasing corporation succeeds to all the rights, obligations and relations of the selling corporation to or in respect to any person, estate, creditor, depositor, trustee or beneficiary of any trust and in respect to any fiduciary relation, and the rights, obligations and relations remain unencumbered

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ORS 709.335 Digital signatures. A trust company may conduct transactions using digital signatures and issue certificates for the purpose of verifying digital signatures. [1997 c.631 §234a; 1999 c.718 §3; 2001 c.535 §35; 2005 c.118 §5]

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ORS 709.340 Trust company quitting business; examination. A trust company quitting business shall furnish to the Director of the Department of Consumer and Business Services satisfactory evidence of its release and discharge from all obligations and trusts provided for in the Bank Act. The director shall examine the trust company, and, if the director is satisfied after the examination that the trust company has discharged all its obligations and trusts, the director shall revoke its certificate of authority and deliver up all securities on deposit with the director under ORS 709.030. [Amended by 1973 c.797 §207]

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ORS 709.350 Successor trustee upon liquidation or receivership; appointment and qualification; petition by director; applicability of state laws. (1) If a trust company goes into voluntary or involuntary liquidation or receivership, the appointment of a successor trustee for the trust shall be handled by the court hearing the liquidation proceedings upon petition by the Director of the Department of Consumer and Business Services, the trust company, any interested person or, in the case of a federal bank or extranational institution, by its receiver or liquidating agent

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ORS 709.360 [Repealed by 1973 c.797 §428]

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ORS 709.370 [Repealed by 1973 c.797 §428]

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ORS 709.380 [Repealed by 1973 c.797 §428]

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ORS 709.390 Discontinuance of trust business; determination of claims against deposit of securities. (1) If a trust company discontinues its trust business, the Director of the Department of Consumer and Business Services shall file in the circuit court for the county in which the principal place of business of the trust company is located a verified petition

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ORS 709.400 Order to start court action; publication of order; jurisdiction over securities; notice to trustor; applicability of state laws. (1) Upon the filing of the petition under ORS 709.390, the court shall make an order requiring all persons having claims against the deposits to start action in the circuit court hearing the petition of the Director of the Department of Consumer and Business Services within six months after the date of the order. Any claim not filed within the six-month period is barred. The petition or the order need not give the names of any beneficiary or the nature of the trusts protected by the deposit

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ORS 709.410 Termination of right to do trust business. The filing by the Director of the Department of Consumer and Business Services of the petition provided for in ORS 709.390 terminates the right of the trust company affected thereby to do a trust business in this state, except as may be necessary to wind up then existing trusts. [Amended by 1973 c.797 §211; 1997 c.631 §223]

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ORS 709.420 Actions or suits on claims; service of summons; preference on calendar. (1) In all actions to determine claims to the deposits, the Director of the Department of Consumer and Business Services shall be a necessary party defendant

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ORS 709.430 Release or payment of deposit pending suit; distribution of deposits upon determination of suit. (1) If any actions on claims against the deposit mentioned in ORS 709.390 are begun within the six-month period, the Director of the Department of Consumer and Business Services shall not release and the court shall not order the payment of any part of the deposit until all actions are determined by final judgment

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