Powers may include removing and replacing trustees, changing situs and governing law, amending administrative provisions, and in some instruments adjusting beneficial interests. Fiduciary status varies by instrument and statute.
Directed trust statutes address the role.
Alternative Names:
Trust Advisor|Protector
Why it Matters?
Whether the protector acts in a fiduciary or nonfiduciary capacity determines liability exposure and the standard governing their decisions, and instruments frequently fail to specify, which produces litigation over whether a protector's removal of a trustee was subject to fiduciary review. Directed trust statutes in many states supply default rules, and stating the capacity expressly avoids the dispute entirely.
Frequently Confused with
Related terms
Frequently asked questions
What ambiguity produces litigation?
How is the dispute avoided?
