456.8-802. Duty of loyalty.

MISSOURI STATUTES AND CODES

Duty of loyalty.

456.8-802. 1. A trustee shall administer the trust solely in theinterests of the beneficiaries.

2. Subject to the rights of persons dealing with or assisting thetrustee as provided in section 456.10-1012, a sale, encumbrance, or othertransaction involving the investment or management of trust propertyentered into by the trustee for the trustee's own personal account or whichis otherwise affected by a conflict between the trustee's fiduciary andpersonal interests is voidable by a beneficiary affected by the transactionunless:

(1) the transaction was authorized by the terms of the trust;

(2) the transaction was approved by the court;

(3) the beneficiary did not commence a judicial proceeding within thetime allowed by section 456.10-1005;

(4) the beneficiary consented to the trustee's conduct, ratified thetransaction, or released the trustee in compliance with section456.10-1009; or

(5) the transaction involves a contract entered into or claimacquired by the trustee before the person became or contemplated becomingtrustee.

3. A sale, encumbrance, or other transaction involving the investmentor management of trust property is presumed to be affected by a conflictbetween personal and fiduciary interests if it is entered into by thetrustee with:

(1) the trustee's spouse;

(2) the trustee's descendants, siblings, parents, or their spouses;

(3) an agent or attorney of the trustee; or

(4) a corporation or other person or enterprise in which the trustee,or a person that owns a significant interest in the trustee, has aninterest that might affect the trustee's best judgment.

4. A transaction between a trustee and a beneficiary that does notconcern trust property but that occurs during the existence of the trust orwhile the trustee retains significant influence over the beneficiary andfrom which the trustee obtains an advantage is voidable by the beneficiaryunless the trustee establishes that the transaction was fair to thebeneficiary.

5. A transaction not concerning trust property in which the trusteeengages in the trustee's individual capacity involves a conflict betweenpersonal and fiduciary interests if the transaction concerns an opportunityproperly belonging to the trust.

6. The following transactions are not presumed to be affected by aconflict between the trustee's personal and fiduciary interest providedthat any investment made pursuant to the transaction complies with theMissouri prudent investor act.

(1) an investment by a trustee in securities of an investment companyor investment trust, or in shares or interests in a partnership or limitedliability company or other entity that operates as a privately offeredinvestment fund, to which the trustee, or its affiliate, provides servicesin a capacity other than as trustee.

(2) the placing of securities transactions by a trustee through asecurities broker that is a part of the same company as the trustee, isowned by the trustee, or is affiliated with the trustee.

(3) in addition to the trustee's fees charged to the trust, thetrustee, its affiliate, or associated entity may be compensated for anytransaction or provision of services described in this subsection 6 or insubdivision (4), (5), or (6) of subsection 8 of this section; provided,however, that with respect to any investment in securities of an investmentcompany or investment trust, or in shares or interests in a partnership orlimited liability company or other entity that operates as a privatelyoffered investment fund, to which the trustee or its affiliate providesinvestment advisory or investment management services or any servicesdescribed in subdivision (5) of subsection 8 of this section, the trusteeshall at least annually notify the persons entitled under section 456.8-813to receive a copy of the trustee's annual report of the rate or method bywhich the compensation was determined.

7. In voting shares of stock or in exercising powers of control oversimilar interests in other forms of enterprise, the trustee shall act inthe best interests of the beneficiaries. If the trust is the sole owner ofa corporation or other form of enterprise, the trustee shall elect orappoint directors or other managers who will manage the corporation orenterprise in the best interests of the beneficiaries.

8. The following transactions, if fair to the beneficiaries, are notpresumed to be affected by a conflict between personal and fiduciaryinterests and are not precluded by this section:

(1) an agreement between a trustee and a beneficiary relating to theappointment or compensation of the trustee;

(2) payment of reasonable compensation to the trustee;

(3) a transaction between a trust and another trust, decedent'sestate, or conservatorship of which the trustee is a fiduciary or in whicha beneficiary has an interest;

(4) a deposit of trust money in a financial institution operated bythe trustee or an affiliate;

(5) a delegation and any transaction made pursuant to the delegationfrom a trustee to an agent that is affiliated or associated with thetrustee, provided that notice of any compensation paid pursuant to thedelegation is given as provided in subdivision (3) of subsection 6 of thissection; or

(6) any loan from the trustee or its affiliate.

9. The court may appoint a special fiduciary to make a decision withrespect to any proposed transaction that might violate this section ifentered into by the trustee.